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Division of Taxation

New Jersey's Bulk Sale Notification Requirement and The Division of Taxation's Form C-9600 - Frequently Asked Questions

What is a Bulk Sale and why must it be reported to the New Jersey Division of Taxation?

The purpose of the Bulk Sale Statute is to protect a purchaser from inheriting any tax debt from a seller of business assets. A bulk sale is the sale (or transfer or assignment) of an individual's or company's business asset/s, in whole or in part, outside of the ordinary course of business. When a bulk sale of business assets occurs, the New Jersey Division of Taxation needs to be notified so it can collect any taxes owed. Business assets are any assets that generate income or loss and may include:

  • Tangible property such as inventory or materials;
  • Real property (land, buildings etc.); and
  • Intangible assets, such as goodwill.

Sales of assets made in the ordinary course of business, such as retail sales to customers, are not considered bulk sales.

Examples of bulk sales transactions:

  • A mechanic owns an auto repair business and decides to retire. He sells his auto repair business (including tools, equipment and inventory) to another mechanic.
  • A baker gives all his business assets (the bakery and its equipment) to another person as a gift.

Examples of transactions that are not bulk sales:

  • A paint store makes a retail sale of brushes and floor stain to a contractor.
  • An established developer regularly buys and sells properties in New Jersey.

What taxes are the Division of Taxation trying to collect through the notification of a Bulk Sale?

The bulk sale may generate a capital gain that is subject to Income Tax. In addition, a business liquidating assets may need to make final payments of sales taxes, withholding taxes, etc. Any delinquent/deficient taxes owed by the seller also may be collected.

How do I report a bulk sale to the State of New Jersey?

The purchaser of business assets, other than in the ordinary course of business, must notify the State at least 10 business days in advance of the sale. This will allow an escrow to be established if the seller has potential tax obligations. To report a bulk sale, file form C9600 .

(The bulk sale rules also may be applied when property is transferred in ways other than a sale. See P.L. 1995 chapter 161 (C54:32B-22C) and P.L. 2007, c. 100, sec. 5, codified as N.J.S.A. 54:50-38.)

What is a business?

A business is any endeavor from which revenue or consideration is realized for the purpose of generating profit or loss.

What is a business asset?

A business asset is any asset that generates income or loss. Business assets can include goodwill, materials, supplies, licenses, patents, copyrights, equipment, leases, merchandise, inventory, realty, or vacant land. A business asset can be tangible or intangible.

Who notifies the Division of Taxation of a bulk sale?

The purchaser or the purchaser's attorney must submit all notifications of bulk sales. A filing by the seller or a third party does not protect the purchaser from being held responsible for potential tax obligations of the seller.

How does the purchaser properly notify the Division of a bulk sale?

The Division of Taxation considers a notification to be proper if the purchaser provides a completed form C9600 . A completed form includes, among other information:

  • Valid New Jersey tax ID numbers for both the seller and purchaser;
  • A specific closing date, which must be at least 10 business days after submission;
  • Proper mailing addresses for both parties and/or their attorneys;
  • Signatures of the purchaser or the purchaser's attorney;
  • A copy of the executed contract of sale, court order, or assignment agreement clearly showing the sales price and all the terms and conditions of the transfer.

The Division of Taxation must receive the C-9600 and a copy of the contract at least (10) business days before the closing date. Business days exclude weekends and holidays. (See C9600 )

Submit these documents via registered or certified mail to:

NJ Division of Taxation
Attn: Bulk Sale Section
PO Box 245
Trenton, NJ 08695-0245

Documents can also be sent by overnight mail, Fed-Ex, or UPS to:

NJ Division of Taxation
Attn: Bulk Sale Section
3 John Fitch Way, 5th floor
Trenton, NJ 08611

Can the C-9600 and contract be hand-delivered or faxed to the Division?

No. The only delivery options are through registered, certified or overnight mail - or through an express package delivery company such as Fed-Ex or UPS. The purchaser must have proof that the notice was delivered to 3 John Fitch Way in Trenton.

The Division received notification less than 10 business days before closing. Will the purchaser be protected from potential tax obligations of the seller?
No. If the closing occurs before the 10 business-day period and the Division has not assigned an escrow to the purchaser, it is a bulk sale violation and the purchaser will be held responsible for the tax obligation of the seller.

Is there a fee for filing the C-9600 form?


Why is a copy of a signed contract of sale, transfer or assignment required as part of the C-9600 form notice?

The Division of Taxation needs the terms of any sale or transfer agreement to determine and collect any taxes that might be owed as a result of the transaction.

Can the purchaser submit the notice without the seller's' New Jersey Tax ID number?

If the purchaser cannot obtain the seller's New Jersey Tax ID number, the purchaser may submit a C-9600 without the number, and the Division will contact the seller to obtain the information.

What if a purchaser fails to satisfy the notice requirements?

A violation occurs if a purchaser fails to supply the State with complete and timely notification of a bulk sale. When a purchaser fails to supply proper bulk sale notification, the purchaser is responsible for any State tax obligations resulting from the sale. The Division can take steps necessary to satisfy the seller's tax indebtedness including judgment, levy, and seizure of assets of the purchaser as well as the seller.

How will the State respond to the C-9600?

The State will reply by sending one or more of the following documents:

  • Escrow Letter - Sent to the purchaser with a copy to the seller, stating the amount of money to be held at the time of transfer;
  • Returns Required Letter - Sent to the seller, outlining which returns must be filed and taxes and fees paid to obtain clearance for the bulk sales case;
  • Clearance Letter - To the purchaser stating the purchaser will not assume any obligation of the seller and no escrow is required.
  • Insufficient Notice - To the purchaser, listing items that are missing from the notification and must be sent in order to make the notification complete.
  • Bulk Sale Violation - To the purchaser, it states that the purchaser has assumed the seller's tax obligation for the sale.

How should a purchaser respond to an insufficient notice?

The purchaser must respond as directed in the notice. If notice came in without a contract, it must be re-submitted via certified or overnight delivery. Failure to provide all information requested will be treated as non-compliance. The Division has 10 days to respond from the date the Division has received all required information.

How much time does the Division have to respond after a purchaser sends a bulk sale notification?

The Division will send a response within 10 business days of receipt of the bulk sale notification.

Is there any way to expedite service?


Can any response letter (escrow, clearance, etc.) be faxed or emailed?

No, the Division sends all correspondence via first-class mail.

What if the Division misses the 10-day deadline for notifying the purchaser of required payments into escrow?

If the Division fails to respond to a bulk sale notification within 10 business days, the purchaser will not be liable for any State tax obligation of the seller.

What is an escrow?

For the purpose of a bulk sale, an escrow is a specific amount of money the State requires the purchaser to withhold from the proceeds of a sale.

How is the escrow calculated?

Data included to determine escrow amounts include (but are not limited to) Division determinations of tax obligations, information from audits, the expected gain from the sale of the assets, and any unfiled returns.

Who is responsible for holding the escrow?

The purchaser or the purchaser's escrow agent must hold the required amount in escrow. If the purchaser or his/her agent does not hold the required escrow as instructed by the Division, the purchaser will be liable for the seller's tax obligations.

A closing or the transfer occurred without the purchaser notifying the Division, but the parties agreed upon an amount to hold in escrow. Is the purchaser protected from liability for the seller's tax obligations?

No. This sale is now considered a bulk sale violation. The agreed-upon escrow is a third-party agreement that the Division was not privileged to and does not satisfy the bulk sale notice requirements.

Can the escrow exceed the purchase price? Why?
Yes. The New Jersey Tax Court has indicated that the escrow can exceed the purchase price. Specifically, 'a purchaser may assume personal liability for the seller's delinquent taxes in excess of the price he pays for the business assets.' Bunting v. Director, Division of Taxation, 1 N.J. Tax 189, 197 (T.C. 1980).

What if there are no proceeds from the transaction or the proceeds are insufficient to generate the Division's required escrow amount?

It is still the purchaser's responsibility to hold the escrow as prescribed by the bulk sale section. It will be between the purchaser and seller to decide who will provide the additional funds at the time of closing to satisfy the escrow.

Can the escrow be reduced?

The escrow may be reduced if the Division caseworker receives additional information that affects the escrow amount. Examples:

  • Payment of deficiencies and/or audit assessments;
  • Filing and payment of delinquent returns.

If taxes are not ordinarily due until the following year, are the amounts due in that year included in the escrow amount?

Yes. The escrow will be calculated to include all taxes that are due and those that would become due as a consequence of the sale.

When will the escrow be released to the seller?

Once the Division is assured that all Division tax obligations of the seller have been met, it will issue a clearance letter to the purchaser or his/her agent allowing the purchaser to release the balance of the escrow funds to the seller.

Is the transfer of real estate that is used for income/business purposes subject to the Bulk Sale Law?


Is the sale of vacant land a bulk sale transfer?

Yes, if the vacant land is a business asset.

Is a short sale of realty subject to bulk sale notification rules?

If the realty that is being sold, transferred or assigned is used for business/income purposes, it is subject to bulk sale notification rules. A bank approval letter should be submitted with the C-9600 form.

Is a formal foreclosure considered a bulk sale?

If a property goes through a formal foreclosure process, a Sheriff's Deed (or Marshal's Deed) is used to transfer assets to a new owner without encumbrances. There is no need to submit a bulk sale notification.

Is a deed in lieu of foreclosure considered a bulk sale?

If the property is or has been used for income-producing purposes, it is considered a bulk sale transfer.

Is it a bulk sale if a seller buys real estate to rehabilitate and then sell?

If the seller buys, rehabilitates and then sells properties, these sales are not subject to the Bulk Sale Law. If the sale is not within a business's ordinary course of business, notification is required.

Is the Bulk Sales Notice required for the sale of a one or two family residential rental property?

The State's Bulk Sales law exempts a one-or two-family residence owned by an individual, estate, or trust. Effective January 9, 2018, the law expanded the exemption to include any combination of individuals, estates, or trusts.

For example: If multiple family members own and then sell a rental property, the sale is not subject to Bulk Sale tax requirements. The exemption does not apply to businesses.

Who is an authorized agent for the buyer or seller?

The only authorized agent is a seller's or buyer's attorney. Any other representative (i.e. Realtor, CPA, title agency) must provide an Appointment of Taxpayer Representative Form (Form M-5008-R) signed by the buyer or seller.

Does a purchaser have to submit a bulk sale notice if the seller is a disregarded entity?


What if the purchase price or the date of sale changes?

Notify the caseworker of any adjustment to purchase price or change of date.

A purchaser files the C-9600 but before closing, assigns its rights to another party. Does the assignee also file form C-9600, even though none of the terms of the sales agreement changed, except for the substitution of the new purchaser?

No, but the Division must be notified. The assignee, by taking the place of the original purchaser/transferee, must now take on all of the previous party's rights and obligations under the law, including responsibility for holding the amount of escrow in the Division's notice to the original purchaser.

If the seller is a tax-exempt or non-profit organization, including but not limited to a church/synagogue/temple/mosque, and is selling its real property and/or tangible property not in the ordinary course of business, does the purchaser have to file a C-9600 form with the Division?

Yes, even though the seller may be exempt from some Division taxes, it might still have tax obligations.

Can sales by an estate or trust be a bulk sale?

Yes, if the assets being sold are business assets.

Does an auction house have to notify the Division if they are auctioning off business assets of an entity not engaged in the business of selling their business assets.

There are two transactions: the transaction between the seller and auction house, and one between the auction house and the ultimate purchaser. The notice requirement is applied to the first transaction: the auction house is the responsible party to notify the State regarding the sale. While not the purchaser, it is a transferee (if the assets have been moved to the auction site), or an assignee (assigned the rights to sell the asset on behalf of the owner). As such, the auction house, prior to their sale, must notify the Division. Once notified, the Division then can require the auction house to hold an amount necessary to comply with N.J.S.A. 54:50-38(c).

Are sales of corporate stock or membership interests subject to bulk sales?

Corporate stock and membership interests owned by individuals, estates or trusts are not considered business assets. Bulk sale notice is NOT required since the entity is not selling anything.

Corporate stock or membership interests owned by a business entity such as a corporation, LLC, LP etc. is a business asset of that business entity. Unless the business entity is in the ordinary course of buying and selling corporate stock or membership interests, the Division must be notified.

49. To whom are checks payable?

The New Jersey Division of Taxation

What is the overnight delivery address for communications and packages about bulk sales?

NJ Division of Taxation
Attn: Bulk Sales
3 John Fitch Way
Trenton, NJ 08611

Where can you find other information about the administration of the Bulk Sale Law by the Division?

Other information and guidelines may be found in Technical Bulletin 60-R

How can the Division be contacted for further information about the Bulk Sale Law and its implementation?

Written inquiries should be submitted to the Division at:

NJ Division of Taxation
Attn: Bulk Sales Unit
P0 Box 245
Trenton, New Jersey 08695-0245.

For inquiries, email the bulk sale unit at

Is the sale of a tax credits awarded under an Economic Development Authority (EDA) incentive program subject to the Bulk Sale Law?

No. The Bulk Sale notification provision is not triggered by the sale (or transfer or re-assignment) of any grants, tax credits or other assistance provided by the New Jersey Economic Development Authority. However, the individual or entity that benefits from any credits must obtain a Business Assistance and Incentive Clearance Certificate from the Division of Taxation before the sale, transfer, or assignment of any credits. Please click the link for instructions on applying for the Clearance Certificate.

Are unitary transfers between members of a combined group that files a New Jersey combined return subject to the Bulk Sales notification requirements?

No. Transactions entered into on and after January 1, 2021, that are intercompany transfers made between combined group members of a New Jersey combined return under the New Jersey Corporation Business Tax Act are exempt from the Bulk Sales notification requirements as long as the transfers are part of the unitary business of the combined group. However, transactions that occur before January 1, 2021 are still subject to the Bulk Sales notification requirements, unless otherwise exempt for some other reason.

Are non-unitary transfers between members of a combined group that file a New Jersey combined return subject to the Bulk Sales notification requirements?

Yes. Unless exempt for some other reason, transfers that are not part of the unitary business of the combined group are still subject to the Bulk Sales notification requirements.

Is the Asset Transfer Tax Declaration (Form TTD) required?

No. The Form TTD is no longer required to be submitted by a seller and has been discontinued.

Last Updated: Wednesday, 05/01/24