313: Economic Recovery Tax Credit (2024)

New Jersey · NJ Division of Taxation · Used for tax years 2024

Form 313 calculates the Economic Recovery Tax Credit against New Jersey Corporation Business Tax for new full-time positions at a location within a qualified municipality. It reports qualifying employee information, the available and allowable credit, and any credit carried forwa

Who files this form

Use Form 313 to claim the New Jersey Corporation Business Tax Economic Recovery Tax Credit. A completed form must be included with Form CBT-100, CBT-100S, or CBT-100U to validate the claim. Taxpayers must also include the appropriate credit form in the year the credit was earned, even if they are not claiming it on that return.

The credit is for qualifying new full-time positions at a new or expanded operation in a qualified municipality. The taxpayer cannot be receiving a benefit under the New Jersey Urban Enterprise Zones Act.

Part I says you do not qualify if any answer to questions 1 through 4 is “Yes.” These questions cover Urban Enterprise Zones benefits, positions that existed before credit year one, temporary or seasonal employment, and employees who are business owners or certain relatives of owners.

For a combined return, the member that earned the credit must complete Form 313.

What you'll need

Have the following information ready:

  • The taxpayer’s name as shown on the return, federal ID number, and unitary ID number, if applicable.
  • The qualifying location’s address and the date the new or expanded operation began.
  • Each qualifying employee’s name, Social Security number, and employment dates. Include an additional sheet if more space is needed.
  • The number of qualifying new full-time positions for the applicable credit year and any credit carried forward from the prior year.
  • Tax liability figures from the applicable CBT return and details of other tax credits already applied.
  • For CBT-100 and CBT-100S filers, New Jersey gross receipts and any applicable affiliated or controlled group payroll information used to determine the minimum tax.
  • For combined return filers not sharing the credit, the group and member allocation factors from Schedule J, line 9.

How to file

Include the completed Form 313 with your CBT-100, CBT-100S, or CBT-100U return. The supplied text does not give a mailing address or e-filing directions.

  1. Answer Part I’s qualification questions. If all four answers are “No,” enter the qualifying location’s address and operation start date.
  2. Complete Part II for each qualifying employee.
  3. Calculate the credit in Part III. Use line 7 for credit year one only and line 8 for credit year two only.
  4. If filing CBT-100 or CBT-100S, complete Part IV. Report the allowable credit from line 18 on Schedule A-3, Part I of your return.
  5. If filing CBT-100U, check the combined return filers box and complete Part V, Section A instead of Part IV. If sharing the credit, report line 27 in the member’s column of Schedule A-3, Part I. If not sharing, fill in the oval at the top of the form, also complete Section B, and report line 36 in that column.

Common mistakes

  • Continuing after a disqualifying answer. If any answer to Part I, questions 1 through 4, is “Yes,” stop. The form says the taxpayer does not qualify.
  • Leaving out Form 313. Include it with the CBT return to validate the claim. The text also requires the appropriate credit form in the year the credit was earned, even if the credit is not claimed that year.
  • Using the wrong credit-year line. Line 7 is for credit year one only. Line 8 is for credit year two only.
  • Completing the wrong calculation section. Combined return filers must use Part V, not Part IV. Members not sharing the credit must complete both Sections A and B and fill in the nonsharing oval.
  • Omitting other credits already used. List credits already applied to the relevant tax liability on line 16, 25, or 34 so the allowable credit is calculated accurately.

Questions people ask

How much is the credit?

The credit is $2,500 for each qualifying new full-time position in credit year one and $1,250 for each in credit year two. The credit, together with other tax credits, is limited to 50% of the taxpayer’s total tax liability and cannot reduce that liability below the statutory minimum. Combined return filers use the group and member limits in Part V.

What counts as a full-time position?

A full-time position is filled permanently by an employee for at least 140 hours per month. Temporary and seasonal employment does not count. The employee definition excludes an owner, the owner’s spouse or dependents, and the owner’s ancestors or descendants.

What are credit year one and credit year two?

Credit year one is the first 12 calendar months following the initial or expanded operations at a location within a qualified municipality. Credit year two is the next 12 calendar months. Credits for activity at a location are limited to a single continuous 24-month period.

Can unused credit be carried forward?

Yes. Unused credit may be carried forward for use in the five privilege periods following the privilege period for which the credit is allowed.

Official sources

All versions of 313