When
a corporation has ceased doing business and the corporate charter is no longer
desired, it is essential that the corporation be dissolved with the New Jersey
State Treasurer through the Division of Revenue to avoid future Corporation
Business tax, penalty, and interest. Every corporation subject to the New
Jersey Corporation Business Tax Act, Chapter 162 Laws of 1945, as amended
and supplemented (NJSA 54:10-A-1 et seq.) must submit New Jersey Corporation
Business Tax Returns whether a corporation discontinued business or distributed
assets in liquidation and it remains subject to at least the minimum tax
($500) on an annual basis from its incorporation or authorization date
until it legally dissolves through the New Jersey
State Treasurer by the Division of Revenue. Failure to dissolve
the corporation when the corporation has ceased doing business will result
in the legal requirement to continue to file Corporation Business Tax returns
with the necessary remittance of the minimum CBT tax.
The
dissolution shall be considered filed and effective as of the date the Division
of Revenue receives the properly completed and executed articles of dissolution,
payment of all fees, and notice of Tax Clearance from the Division of Taxation.
All business tax eligibilities for the corporation will be ended as of the
date the request for dissolution is received and accepted by the Division
of Revenue. However, prior tax liabilities will still apply and be subject
to the Division of Taxation's review. Please note that if the corporation
does not resolve prior tax liabilities due the Division of Taxation and a
Tax Clearance Certificate is not issued the business tax eligibilities will be
reversed as if there was no lapse in subjectivity.
If dissolution procedures are not completed, and full payment of the outstanding
liability is not received, the case will be forwarded to the Special Procedures
Branch, Judgment Section, for further collection action. Notice and Demand
for Payment letters will be sent to the Corporation and, in the event there
is outstanding trust liability, to the corporate officers. Responsible corporate
officers will be held personally responsible for trust fund taxes. If the
tax liability is not resolved, a Certificate of Debt will be filed in the
New Jersey Superior Court against the corporation and any responsible officers.
A 10% Cost of Collection fee is added to the docketed judgment amount and
becomes part of the outstanding debt. A Notification of Judgment letter is
sent to the corporation and responsible officers who are covered by the docketed
judgment.
Also, in accordance with N.J.S.A. 14A:6-12, N.J.S.A. 54:50-18 and other applicable
provisions of the Law any officer or director of any corporation who distributes
or causes to be distributed any assets in dissolution or liquidation to the
stockholders without having first paid all corporation franchise taxes, fees,
penalties and interest imposed upon said corporation, shall be personally
liable for said unpaid taxes, fees, penalties and interest.
Please note that the Division is imposing a Referral Cost Recovery Fee as
authorized by N.J.S.A. 54:49-12.3 and N.J.A.C. 18:2-2.5(d). In cases where
any state tax remains unpaid and the Division of Taxation refers a taxpayer's
account to an outside debt collection agency, a Referral Cost Recovery in
the amount of 10% of the amount referred will be assessed. This fee will be
in addition to the interest or penalties imposed. Other penalties will be
imposed on delinquent returns as follows: