N.J.A.C. 18:7-21.26 - Conditions Warranting the Designation of a Managerial Member by the Director

(a) The Director shall designate one of the members of the combined group as the managerial member of the combined group, if one of the following conditions applies:

1. The parent corporation that is a member of the combined group does not have nexus with New Jersey and the combined group refuses to select a new managerial member of the combined group;

2. The managerial member dissolves or otherwise leaves the combined group because the managerial member is purchased by an unrelated third party or is no longer unitary with the combined group, and the combined group does not elect a new managerial member of the combined group;

3. The managerial member, which is not the parent corporation, no longer has nexus with New Jersey and the combined group refuses to elect a new managerial member of the combined group;

4. The Director determines, based on the facts and circumstances, that separate return taxpayers and their affiliates are unitary and should be filing a New Jersey combined return, but they refuse to file a New Jersey combined return and designate a managerial member; or

5. Where the non-U.S. parent corporation is otherwise the managerial member of the combined group, there are other non-U.S. corporations that are unitary with the combined group and meet the requirements for inclusion on a water's-edge basis pursuant to N.J.S.A. 54:10A-4.11, but the U.S. corporations make an affiliated group election, and the non-U.S. parent corporation otherwise refuses to file a water's-edge combined return for the non-U.S. corporations.

(b) The items at (a) above shall not represent an all-inclusive list of circumstances, where the Director may exercise the right to designate the managerial member of the combined group.