New Jersey Statutes 42:2C-92. Tax Classification
Terms Used In New Jersey Statutes 42:2C-92
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
- State: extends to and includes any State, territory or possession of the United States, the District of Columbia and the Canal Zone. See New Jersey Statutes 1:1-2
a. For all purposes of taxation under the laws of this State, a limited liability company formed under this act or qualified to do business in this State as a foreign limited liability company with two or more members shall be classified as a partnership unless classified otherwise for federal income tax purposes, in which case the limited liability company shall be classified in the same manner as it is classified for federal income tax purposes. For all purposes of taxation under the laws of this State, a member or a transferee of a member of a limited liability company formed under this act or qualified to do business in this State as a foreign limited liability company shall be treated as a partner in a partnership unless the limited liability company is classified otherwise for federal income tax purposes, in which case the member or transferee of a member shall have the same status as the member or transferee of a member has for federal income tax purposes.
b. For all purposes of taxation on income under the laws of this State and only for those purposes, a limited liability company formed under this act or qualified to do business in this State as a foreign limited liability company with one member is disregarded as an entity separate from its owner, unless classified otherwise for federal tax purposes, in which case the limited liability company will be classified in the same manner as it is classified for federal income tax purposes. For all purposes of taxation on income under the laws of this State and only for those purposes, the sole member or a transferee of all of the limited liability company interest of the sole member of a limited liability company formed under this act or qualified to do business in this State as a foreign limited liability company is treated as the direct owner of the underlying assets of the limited liability company and of its operations, unless the limited liability company is classified otherwise for federal income tax purposes, in which case the member or transferee of a member will have the same status as the member or transferee of a member has for federal income tax purposes.
c. With respect to a limited liability company that is taxed as a partnership for federal income tax purposes, the entity is also liable for all obligations of the partnership as provided by P.L.2022, c.133 (C. 54:50-47 et al.) in addition to its liabilities in section 30 of P.L.2012, c.50 (C. 42:2C-30).
L.2012, c.50, s.92; amended 2022, c.133, s.15.