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Division of Taxation

Corporation Business Tax – Licensed Professional Fees

What is this fee and who is required to pay it?
N.J.S.A. 54:10A-18, enacted in 2002, requires Professional Corporations or Professional Associations that have more than two licensed professionals to pay a Professional License Fee with their Corporation Business Tax return in the amount $150 (for each licensed professional, limited to $250,000 per year).

The fee applies to all licensed professionals, including owners, shareholders, and employees associated with the corporation including non-resident New Jersey licensed professionals.

When a licensed professional is associated with more than one professional corporation, each corporation must pay the fee for the individual.

What is a Professional Corporation or Association?
A Professional Corporation or Association is one organized for the specific purpose of providing the same professional services as its shareholders, each of whom is licensed or legally authorized to provide that service. See N.J.S.A. 14A:17-1 et seq.

What is a professional service?
A professional service is any type of personal service to the public that requires a license or other legal authorization prior to performing the service. See: N.J.S.A. 14A:17-3.

Who are licensed professionals for the purpose of the fee?
As defined in N.J.S.A. 14A:17-3, licensed professionals are: certified public accountants, architects, optometrists, ophthalmic dispensers and technicians, professional engineers, land surveyors, land planners, chiropractors, physical therapists, registered professional nurses, dentists, osteopaths, physicians and surgeons, doctors of medicine, doctors of dentistry, podiatrists, veterinarians, and attorneys-at-law.

Are trade professionals with licenses acquired through vocational training, occupational training, and/or apprenticeships performing personal services counted for purposes of the fee?
No. Although trade professionals undergo strict and thorough training and certification programs, licenses/certifications acquired through vocational training, occupational training, and/or apprenticeships within those trades are not considered licensed professionals for the purposes of the fee. Examples include, but are not limited to: plumbers, dental hygienists, electricians, iron workers, iron welders, HVAC technicians, auto mechanics, barbers, cosmetologists, fire and burglar alarm services, acupuncturists, commercial driver's license holders, hair stylists, elevator mechanics, escalator mechanics, moving walkway mechanics, locksmiths, and court reporters.

Calculating, Reporting, and Paying the fee.
Use Schedule PC which is filed and paid with your Corporation Business Tax return (Form CBT-100, CBT-100S, or CBT-100U), to calculate the fee.

How is the portion of the fee calculated when some of the licensed professionals in the professional corporation are nonresident professionals without physical nexus with New Jersey?
For this portion of the fee, the number of nonresident licensed professionals without physical nexus is multiplied by the fee and the result is then multiplied by the corporation's business allocation percentage from the Schedule J. See N.J.A.C. 18:7-19.2(c)(3).

Last Updated: Thursday, 03/05/20