Tax Tip #202

In response to states like NY & DE that impose the “convenience of the employer” rule, the New Jersey Economic Development Authority (NJEDA) board approved a countermeasure with its NJ Reassigning In-State Employees (NJ RISE) program. This program incentivizes businesses to relocate NJ residents working out-of-state back to NJ.

NJ RISE targets businesses principally located outside of NJ and has NJ resident employees assigned to work in states that adhere to the “convenience of employer” rule for income taxation. In such cases, the income of these employees, even when working from home in NJ, gets taxed by the state of the employer’s location.

With NJ RISE, eligible businesses can receive grants equal to the amount of NJ gross income tax withholdings of the reassigned resident employees during a tax year, capped at $500,000 per business.

To be eligible to apply for a grant, a business must principally be located in another state, have more than 25 full-time employees, and apply to NJEDA on or before July 1, 2028.

In awarding the grants, the NJEDA could require eligible businesses to make certain capital investments or provide compensation increases to the reassigned employees.

Have more questions about NJ RISE grants? Contact a Goldstein & Loggia team member for assistance.