Assembly advances Dancer legislation providing tax credits to businesses for mitigating spread of Covid-19

Assembly advances Dancer legislation providing tax credits to businesses for mitigating spread of Covid-19

Ron Dancer

TRENTON, N.J. – Businesses in New Jersey that make structural improvements to protect their employees from the spread of the coronavirus could be eligible for tax credits under a bill sponsored by Assemblyman Ron Dancer and advanced by the Assembly Commerce and Economic Development Committee today.

“The economic consequences of the coronavirus and the governmental responses to it are a considerable part of the overall pandemic picture,” said Dancer (R-Ocean). “New Jersey distributed more than $23 billion in unemployment benefits to more than 1.5 million residents this past year. We must get people back to work and do it safely. This bill will incentivize businesses to make improvements to protect the health of their employees and provide tax relief to those that have already made those investments.”

Dancer’s bill (A5389) establishes a gross income tax and corporation business tax credit for non-residential building improvement expenses that reduce the spread of Covid-19. Improvements to ventilation, ultraviolet lighting, infrared thermometers, transparent sneeze guards or shields, touchless entryway and security, and any equipment meant to protect employees and patrons could all qualify as eligible expenses under the bill.

“Businesses incurred unprecedented and unexpected costs during the public health crisis,” said Dancer. “They have had to navigate occupancy restrictions that depressed sales, the added expense of protective equipment and so much more. A tax credit is an effective way to alleviate some of the financial strain that comes with creating a safe workspace during these challenging times.”

The credit will be allowed for expenditures made during taxable years 2020, 2021, and 2022. The credit amount would be equal to 75 percent of the expenditures for a workspace smaller than 30,000 square feet, up to $100,000, and 50 percent of the expenditures for a workspace larger than 30,000 square feet, up to $250,000.

In January, the Senate unanimously passed a companion bill (S3305). The bill goes to the speaker for further consideration.