If business activities are carried on both inside and outside New Jersey, business income may be allocated
to determine the amount of income from New Jersey sources. Carrying on business activities outside New
Jersey means maintaining, operating or occupying a regular place of business outside New Jersey, such as
an office, shop, store, warehouse, factory, agency or other place where the business’s affairs are system-
atically and regularly conducted.
The business may not allocate income if it has only an occasional or isolated business transaction outside
the State. Likewise, if the business has no regular place of business outside New Jersey, it may not allocate
income, even though its representatives travel outside the State for the purposes of performing duties
connected with the trade or business, and make sales or perform services for persons or corporations
located outside the State.
Be sure that Form NJ -NR-A is firmly attached to Form NJ -1040NR, NJ -1041, or NJ -1065, and that the name
and address on the Business Allocation Schedule agree exactly with the name and address on the return to
which it is attached.
Section 1 – Business Locations
Use Section 1 to list the locations where the business activities are conducted. In Columns (a) and (b) list
the exact locations at which the business carries on activities both inside and outside the State. List all
business locations. In Column (c) describe the places listed in Columns (a) and (b) (i.e., branch office,
agency, factory, warehouse, etc.). In Column (d) indicate whether the business rents or owns each location
listed. Attach additional sheets if necessary.
Section 2 - Average Values
Use Section 2 to determine the average values of your business assets. The average value of property
owned is determined by adding (1) the book value of the property at the beginning of the taxable year and
(2) the book value of the property at the end of the taxable year and dividing the sum by two.
The average value of property rented or leased is valued at eight times the annual rent. Rent includes any
amounts paid in addition to, or accrued in lieu of rent for the period covered by the return (such as interest,
taxes, insurance and repairs).
Line 1 - Real Property Owned
Enter on Line 1, Column A, the average value of the real property listed in Section 1 that was owned for the
period covered by the return. Include property located both inside and outside New Jersey.
Enter on Line 1, Column B, the average value of the real property listed in Section 1 that was owned in the
State. Include only property located in New Jersey.
Line 2 - Real and Tangible Property Rented