The Director of the Division of Taxation has the right to pursue collection, or secure protested tax liabilities, while a finding or assessment is being protested.
However, N.J.S.A. 54:49-18 imposes certain restrictions on when we can require security as follows:
Except in the case of an arbitrary assessment pursuant to N.J.S.A. 54:49-5 or N.J.S.A.54:49-7, no security shall be required for an amount in controversy of less than $10,000. Contested assessments of $10,000 or more shall not require security unless the Director determines that there is a substantial risk of the taxpayer’s failure or inability to pay the liability, based on the compliance history and financial condition of the taxpayer.
The Conference and Appeals Branch identifies taxpayers who are required to provide security in order to stay the collection process. We will not seek any collections relative to a protested tax liability, if you remit all required security or where otherwise required by law.
The Conference and Appeals Branch will contact you and/or you representative, in writing, if it determines that you must:
If we request you pay your tax and/or furnish security, and you do not to do so within 30 days, we will file a “Certificate of Debt” with the Superior Court of New Jersey N.J.S.A. 54:49-12.
For cases involving trust fund taxes, we may also issue a “Finding of Responsible Person.”
The above rules also apply when filing a complaint with the Tax Court of New Jersey.