Published Tax Court Opinions

STATE AND LOCAL TAXES – SALES TAX, IMPOSITION OF TAX – ADMINISTRATION & PROCEDURE, ASSESSMENTS – PRESUMPTIONS, REBUTTAL OF PRESUMPTIONS – EVIDENCE – LAY WITNESS TESTIMONY - HEARSAY EXCEPTIONS – BUSINESS RECORDS – PUBLIC RECORDS 

Tax Court:  La Troncal Food Corp. and Vincente Intriago v. Dir., Div. of Taxation; Docket No. 013472-2017, opinion by Nugent, J.T.C., decided October 2, 2024.  For plaintiff – Chinemerem Njoku (C.N. Njoku, LLC, attorney); for defendant – Heather Lynn Anderson, Deputy Attorney General (Matthew J. Platkin, Attorney General of New Jersey, attorney). 

Held:  Where defendant’s auditor did not testify at trial, the court rejected defendant’s proffered lay opinion testimony from the auditor’s supervisor regarding the reasonableness of the auditor’s actions in setting the estimated tax assessment. The court found the witness’s testimony was inadmissible under Evid. R. 701 due to the supervisor’s lack of personal knowledge of the auditor’s examination. The court also rejected defendant’s proffer of the non-testifying auditor’s report and work papers as an exception to hearsay under Evid. R. 803(c)(6) and Evid. R. 803(c)(8) since the data underlying the estimated assessment included information obtained from the wrong business and the auditor’s methodology was unexplained.  The court found the documents untrustworthy and thus, could not conclude that the auditor performed his duty in a “proper, careful and prudent manner” for purposes of Evid. R. 803(c)(8).

 
The court found plaintiff overcame the presumption of correctness that attaches to the tax assessment by production of credible evidence attacking the reasonableness of the methodology and data the auditor utilized.  The court further found the methodology was aberrant given the auditor’s collection and use of unreliable data wholly irrelevant to Taxpayer’s business and unexplained methodology.  Accordingly, the court set the assessment aside. The court determined plaintiff’s expert’s reconciliation of plaintiff’s sales records to be credible, thus, plaintiff met its burden of persuasion that the sales tax and corporate business tax owed should be less than that owed under defendant’s estimated assessment. 

(38 pages)

LOCAL GOVERNMENTS, FINANCE.  LOCAL GOVERNMENTS, ADMINISTRATIVE BOARDS. ADMINISTRATION & PROCEDURE, ASSESSMENTS. STATE & LOCAL TAXES, REAL PROPERTY TAXES. LOCAL GOVERNMENTS, CLAIMS BY & AGAINST. LEGISLATION, INTERPRETATION. HEARINGS, EVIDENCE.  AMENDMENT OF PLEADINGS, RELATION BACK.  

Tax Court: Town of Morristown v. Morris County Board of Taxation; Docket No. 005100-2024, opinion by Novin, J.T.C., decided July 24, 2024.  For plaintiff – Emil H. Philibosian and Shaun S. Peterson (Hoagland, Longo, Moran, Dunst & Doukas, LLP, attorneys); for defendant - Michelline Capistrano Foster, Deputy Attorney General (Matthew J. Platkin, Attorney General of New Jersey, attorney).

Defendant argued, under motion for summary judgment, that because plaintiff failed to object to defendant’s 2024 preliminary Morris County equalization table at the county hearing, under N.J.S.A. 54:3-18, plaintiff was precluded from challenging defendant’s 2024 final Morris County equalization table before the Tax Court under N.J.S.A. 54:51A-4a.  Defendant also argued that plaintiff’s challenge to the 2024 final Morris County equalization table was untimely filed under R. 8:4-2(a)(1), and that plaintiff cannot demonstrate defendant’s adoption of the 2024 final Morris County equalization table was arbitrary and capricious.  Therefore, defendant sought dismissal of plaintiff’s complaint with prejudice.
  
Holding: The court found the statutory language under N.J.S.A. 54:51A-4a and N.J.S.A. 54:51A-5b, permitting a taxing district or taxpayer to challenge a final county equalization table, to be clear and unambiguous.  Our Legislature required: (i) the filing of a timely a complaint in the Tax Court; (ii) the complaint must be served on the county board of taxation and on the chief executive officer and the clerk of the Board of Chosen Freeholders and on the clerk of every taxing district in the county; (iii) the complaint shall not suspend the apportionment of moneys or collection of taxes in the county; (iv) the Tax Court hearing shall be conducted in the county; (v) five days’ advance written notice of the hearing must be given by mail to the governing body of each taxing district in the county; and (vi) the hearing shall be conducted and a decision rendered on or before September 10, annually.  The court concluded that the Legislature did not impose any requirement that a taxing district object to a preliminary county equalization table, as a prerequisite to challenging a final county equalization table before the Tax Court.  In addition, the court determined that plaintiff’s complaint was timely filed, under R. 8:4-2(a)(1).  Finally, the court discerned that whether the adoption of the 2024 final Morris County equalization table is arbitrary and capricious, or whether the table is unreasonable, incorrect, or plainly unjust, and impresses upon plaintiff a substantially excessive share of the county tax burden, is a disputed material fact.  Accordingly, the court denied defendant’s motion for summary judgment.

(38 pages)
 

STATE GROSS INCOME TAX

Tax Court: Donna Porcaro v. Director, Division of Taxation, Docket No. 012296-2020; opinion by Bedrin Murray, J.T.C., decided May 31, 2024.  For plaintiffs – Donna Porcaro (Self-Represented); for defendant – Linzhi Wang (Matthew Platkin, Attorney General of New Jersey, attorney). 

Held:  Plaintiff’s challenge to defendant’s denial of her claim for a refund of New Jersey gross income tax (GIT) for tax year 2016 is dismissed as untimely, depriving this court of subject matter jurisdiction.  Based on the totality of credible testimonial and documentary evidence presented, the court finds that plaintiff received defendant’s December 21, 2017 final determination denying plaintiff’s refund claim in December 2017, and not in May 2020 as plaintiff alleges.  Therefore, plaintiff was unable to overcome the presumption of receipt that attaches to defendant’s final determination under N.J.S.A. 54:50-6(a).  As such, plaintiff’s complaint is dismissed with prejudice.  

(18 Pages)        
 

LOCAL PROPERTY TAXATION – MUNICIPAL CHARGE – NON-RESIDENTIAL SITE DEVELOPMENT FEE – PLANNING BOARD ESCROW FEES – LEGISLATION, INTERPRETATION – LOCAL GOVERNMENTS, FINANCE
Tax Court:  Freda, Joseph A. by Acme as tenant v. City of Sea Isle City; Docket No. 006381-2023, opinion by Cimino, J.T.C., decided March 5, 2024.  For plaintiff – Pablo M. Kim(Heinze Law, P.A.); for defendant – Paul J. Baldini, (Paul J. Baldini, P.A.).
Held:  A tax appeal cannot go forward if a municipal charge is not paid.  Municipal charge is a term of art defined by the Legislature.  Since neither the non-residential development fee nor the planning board escrow fees constitute a municipal charge in this case, nonpayment cannot bar a tax appeal. 
(11 pages)
 

THIRD PARTY APPEALS; TRANSFERS OF MATTERS NOT COGNIZABLE IN TAX COURT TO LAW DIVISION

Tax Court:  Westerhold v. Toms River Township, Docket Nos. 008087-2022, 007534-2023, 009583-2022, 007535-2023;  Westerhold v. Brick Township, Docket Nos. 010281-2020, 010282-2020, 008086-2022, 007536-2023, 008085-2022, 007532-2023, opinion by Fiamingo, J.T.C., decided February 20, 2024.  For plaintiffs - Paul Tannenbaum, Peter Zipp, Michael Kurpiewski (Zipp & Tannenbaum, attorneys).  For defendant, Toms River Township – Kelsey A. McGuckin-Anthony (Dasti, Murphy, Ulaky, Loutsouris & Connor, attorneys); for defendant, Brick Township – Scott W. Kenneally (Starkey, Kelly, Kenneally, Cunningham, et al., attorneys). 

HELD:  Plaintiffs’ complaints contesting the local property tax assessments of third parties filed after February 21, 2021, were not cognizable in the Tax Court as a result of amendment to N.J.S.A. 54:3-21 eliminating subject matter jurisdiction over such appeals in the County Boards of Taxation and the Tax Court; third party tax appeals filed in the Tax Court after February 21, 2021, should be transferred to the Law Division pursuant to R.1:13-4, to be heard as actions in lieu of prerogative writs, per R. 4:69. 

(11 pages)
 

LOCAL PROPERTY TAX – VETERAN’S EXEMPTION – ARMY NATIONAL GUARD

Tax Court: Alemany v. Township of Marlboro, Docket No. 007209-2023; opinion by Sundar, P.J.T.C., decided January 29, 2024.  For plaintiff - Sheryl Alemany, self-represented; for defendant - Lani M. Lombardi, Esq. (Cleary Giacobbe Alfieri Jacobs, LLC, attorneys).

HELD: Plaintiff, who served in the National Guard, was declared 100% and permanently disabled due to a service-connected disability by the federal Department of Veterans’ Affairs, and was honorably released by the U.S. Army.  Defendant denied local property tax exemption for her residence under N.J.S.A. 54:4-3.30 because federal Form DD-214 stated that she was released from “active duty training” and the pre-2019 precedent held that veterans training in the National Guards were not entitled to the exemption.  The court found that the New Jersey Constitution and N.J.S.A. 54:4-3.30 require only “active service” in the Army; the Form DD-214 evidenced that plaintiff was in active service with the U.S. Army National Guard; and full-time National Guard duty is considered as “active service” under the federal military law; therefore, plaintiff qualified for the exemption.  The term “active duty training” in Form DD-214 cannot be viewed in a vacuum and solely control determination of plaintiff’s qualification for the exemption.

(10 pages) 
 

STATE TAXATION – EARNED INCOME TAX CREDIT – GROSS INCOME TAX – FILING STATUS
Tax Court:  Doreen A. Scott v. Dir., Div. of Tax’n; Docket No. 010435-2022, opinion by Cimino, J.T.C., decided December 22, 2023.  For plaintiff – Doreen A. Scott, pro se.; for defendant – Michelline Capistrano Foster, Deputy Attorney General (Matthew J. Platkin, Attorney General of New Jersey, attorney).

Held:  In this challenge to the Director’s denial of the Earned Income Tax Credit (EITC), Ms. Scott filed her tax returns as head of household.  Her husband, Robert Scott, filed as single.  Since the Scotts are married and living together, Ms. Scott cannot file as head of household and Mr. Scott cannot file as single.  Instead, their tax status is married, either joint or separate.  The Director selected married-separate which maximizes the State’s recovery.  The Scotts want married-joint which reduces, but does not eliminate, the EITC. 

The Director argues that taxpayers must file a married-joint federal return to qualify for the credit.  The court rejects this contention.  Further, barring any specific statutory prohibition, married taxpayers are entitled to select whether they want a tax status of joint or separate.  An incorrect selection of tax status, such as head of household or single, does not preclude a married-joint return, nor allows the Director to impose married-separate status.  The Scotts are entitled to the EITC, albeit somewhat reduced.

(25 pages)
 

ADDED ASSESSMENT APPEALS (N.J.S.A. 54:4-63.11) – CASE TRACK REASSIGNMENT (R. 8:6-7) 

Tax Court: Jantzen, Giuseppin Nina & Matthew D. v. Green Township; Docket Nos. 008224-2022 & 008229-2022, opinion by Bianco, J.T.C., decided May 30, 2023.  For plaintiff – Kevin S. Englert (The Englert Law Firm, L.L.C.; attorney); for defendant – Robert B. McBriar (Schenck, Price, Smith & King, L.L.P.; attorney).

Plaintiff Taxpayers moved to change the small claims track designation assigned by the Tax Court Management Office for both above-referenced docket numbers, to the standard track to secure more comprehensive discovery.  Defendant Township cross-moved for summary judgment to dismiss the added assessment appeal under docket number 008224-2022 as untimely pursuant to N.J.S.A. 54:4-63.11. The court denied Defendant’s cross-motion to dismiss the added assessment appeal finding that the Township did not establish that the Tax Collector mailed notice of the 2021 added assessment to the Taxpayers, nor did the Taxpayers have constructive notice of the added assessment, and, Taxpayers were further denied a hearing before the Sussex County Board of Taxation. The court granted Plaintiffs’ motion the change the track designation in both matters finding that the change is necessary for Plaintiffs to pursue their claims against Defendant. 

(26 Pages)
 

LOCAL PROPERTY TAX

Tax Court:  Levy v. City of Long Branch, Docket No. 000448-2021, opinion by Sundar, P.J.T.C., decided May 5, 2023.  For plaintiff - Michael I. Schneck (Schneck Law Group, LLC, attorney) and Robert E. Spiotti (Spiotti & Associates, PC, attorney); for defendant – Shaun Peterson (Hoagland, Longo, Moran, Dunst & Doukas, LLP, attorney).

Held: Parties reached a global settlement agreement as to plaintiff’s complaint in the Tax Court for tax year 2021 and his petition before the county board of taxation for tax year 2022. The stipulation in the Tax Court matter was silent on the Freeze Act’s application. The stipulation in the County Board matter included plaintiff’s express waiver of the Freeze Act. Based on the four corners of the Tax Court stipulation, the court found that plaintiff did not waive application of the Freeze Act in the Tax Court matter.  Based on the record, the court found that plaintiff’s waiver of the Freeze Act in the County Board matter did not extend to, nor would be implied in settlement of the Tax Court matter. The court was unpersuaded that the only base year in a multi-year settlement must be the last year of the value judgment. The court was also unpersuaded that, without more, the County Board’s judgment is proof of a change in value for Freeze Act purposes.  
The court granted plaintiff’s motion for application of the Freeze Act to tax year 2023 based on the Tax Court’s final value judgment for tax year 2021.

(15 Pages)

STATUTE OF LIMITATIONS, RESPONSIBLE PERSON LIABILITY FOR GROSS INCOME TAX-ER AND SALES AND USE TAX.

Tax Court:  Gill v. Director, Division of Taxation, Docket No.004035-2021, opinion by Fiamingo, J.T.C., decided May 1, 2023.  For plaintiff  - Maria L. Dooner; for defendant Lindsey R. Curewitz (Matthew Platkin, Attorney General of New Jersey, attorney). 

HELD:  Plaintiff moved to apply the limitations period for assessment of tax to imposition of responsible person liability for gross income tax withholding under N.J.S.A. 54A:9-6(f) and (g) and for sales and use tax under N.J.S.A. 54:32B-2(w).  Director opposed and moved to uphold notification of responsible person status issued beyond limitation periods of the Gross Income Tax Act and Sales and Use Tax Act.  The court ruled that the notification of responsible person for purposes of imposing the penalty assessed by N.J.S.A. 54A:9-6(f) and/or (g) for gross income tax employer withholding required by N.J.S.A. 54A:7-1 et seq. was subject to the limitations period applicable to assessment of gross income tax.  The court ruled that no limitations period applied to the notification of responsible person liability for Sales and Use Tax, as such tax by statute was assessed against the responsible person upon the filing of the return by the seller.

21 pages
 

No summary available for this Appellate Division opinion which has been approved for publication in the Tax Court Reports.

Tax Court:  New Jersey State Firemen’s Association v. Dir., Div. of Taxation, Philadelphia Contributionship Ins. Co., Germantown Insurance Co., Greater New York Mutual Ins. Co., and Strathmore Ins. Co., Docket No. 000151-2019, opinion by Sundar, P.J.T.C., decided January 30, 2023.  For plaintiff - Michael E. Sullivan (Parker McCay, P.A., attorney); for defendant, Dir., Div. of Taxation - Michael J. Duffy (Matthew J. Platkin, Attorney General of New Jersey, attorney), for remaining defendants and intervenor Strathmore Ins. Co. - Michael A. Guariglia and Jamie Zug (McCarter & English, LLP, attorney).

Held: Defendant, Division of Taxation’s (“Taxation”) decision via its web-published Notice in 2016, to extend the statutory cap on premiums applied when computing the insurance premium tax (IPT) for domestic and foreign companies, in calculating the fire insurance premium tax (FIPT) paid to plaintiff by foreign insurers, is contrary to the plain language and intent of the FIPT statute, N.J.S.A 54:18-1, thus is not entitled to any deference.  Its interpretation of the provision in N.J.S.A. 54:18A-2(a) that the FIPT is considered “a part of” the “payable” IPT as requiring the cap to apply in computing the FIPT is unreasonable because, (a) since 1945, this provision has been interpreted to simply mean that the IPT statute requires a credit for the FIPT paid so that a foreign insurer does not pay a tax on fire insurance premiums twice, and (b) it results in plaintiff receiving less than the mandated 2% FIPT on “all of the” fire insurance premiums earned in New Jersey.  The cap on premiums for purposes of computing the IPT need not, and should not, be extended in computing the FIPT unless the Legislature acts to amend the respective statutes.

Due to this holding, the court did not need to consider plaintiff’s arguments that Taxation’s decision violated the Administrative Procedures Act, or Taxation’s arguments that its Notice, as a public guidance document should be upheld under the temporary validity doctrine until it formally promulgates and finalizes regulations reflecting its changed position as to FIPT computation.  

The court granted NJSFA’s motion for partial summary judgment, invalidated the Notice, and denied Taxation’s motion for summary judgment.
 

Tax Court; Options Imagined v. Parsippany-Troy Hills Township; Docket Nos. 010456-2020, 09577-2021 and 007910-2022; opinion by Bianco, J.T.C., decided October 31, 2022. For plaintiff – Robert B. McBriar (Schneck, Price, Smith, & King, LLP., attorneys); For defendant – Richard P. DeAngelis (Connell Foley., attorneys).

The court held that Options Imagined, a New Jersey nonprofit and Federal § 502 (c) (3) corporation, satisfied the requirements for property tax exemption under N.J.S.A. 54:4-3.6, finding that it was actually used in furtherance of the nonprofit’s charitable purpose, to provide care to mentally disabled adults, where its sole and current resident is the son of the President of the corporation. The court found that Options satisfied the Paper Mill use test because it is opened to the public and serves a public purpose.

Tax Court: SF III Kinderkamack, LLC v Borough of Oradell; Docket Nos. 005860-2021, opinion by Orsen, J.T.C., decided October 21, 2022. For proposed Intervenor – Paul Tannenbaum (Zipp & Tannenbaum, LLC, attorneys); for plaintiff – Michael Ash (Carlin, Ward, Ash & Heiart, LLC, attorneys); and for defendant – Alan Spiniello (Alan Spiniello Law Offices, attorneys).

Held: Intervenor, Dabby Bergen Medi Pro, LLC, Sianes Bergen Medi Pro, LLC, YB 690 Kinder, LLC, and Yazam Investments, LLC collectively, sought to be joined as a party to the 2021 property tax appeal filed by plaintiff, SF III Kinderkamack, LLC. Intervenor asserted that the court rules pertaining to the transfer of interest, intervention and joinder were applicable; and standing existed to participate in the case as the new owner of the property. Defendant, Borough of Oradell, opposed the motion and maintained that Intervenor did not have standing because it was not the property owner as of the property tax appeal filing deadline, its claim was not within the statute of limitations and the requirements of the applicable court rules were not met. The court determined that Intervenor met the standards to join due to the transfer of interest of the property per the court rules. Moreover, the court found that Intervenor had standing in its fact-sensitive analysis through multiple factors including the review of its financial interest in the property and responsibility to pay taxes. Intervenor was also not barred by the statute of limitations as no new relief was sought. Accordingly, the court granted Intervenor’s motion to join the case as a party.

Tax Court: Bloomingdale’s, Inc. and Bloomingdale’s c/o Federated Department Stores, Inc. v. Hackensack City; Docket Nos. 006396-2016, 007619-2016, 004282-2017, 006959-2018, 003279-2019, 004117-2020, opinion by Novin, J.T.C., decided August 8, 2022; publication date September 28, 2022. For plaintiff – Gregory S. Schaffer and Adam R. Jones (Garippa, Lotz & Giannuario, P.C., attorneys); for defendant – Kenneth A. Porro (Chasan Lamparello Mallon & Cappuzzo, P.C., attorneys).

The court concluded that the subject property’s tax assessments should be afforded a presumption of validity because defendant’s tax assessor relied on reasonable available market data and methods in fulfilling his constitutional and statutory obligations. The court found that defendant’s ineligibility to conduct an annual reassessment program, under N.J.A.C. 18:12A-1.14(i), was not singularly dispositive on the issue of whether the local property tax assessments were entitled to a presumption of validity. Rather, the court observed that the inquiry must focus on whether the valuation and local property tax assessments were reasonably related to sound assessment practices, based on reasonable data and information, a sensitivity to changing market conditions, and consideration of physical factors uniquely applicable to the property. The court found that plaintiff offered no evidence that the market data, analysis, and/or methodology relied upon by the defendant’s tax assessor were flawed or arbitrary. Accordingly, the court rejected plaintiff’s arguments that no presumption of validity should attach to the subject property’s tax assessments.

Tax Court: Jaguar Land Rover North America v. Director Division of Taxation and Township of Mahwah; Docket No. 014046-2018; opinion by Bianco, J.T.C., decided July 29, 2022. For plaintiff – Joseph E. Bock, Esq. (Spiotti & Associates, P.C., attorney); for defendant Director, Division of Taxation – Anthony D. Tancini, Esq. (Matthew J. Platkin, Acting Attorney General of New Jersey, attorney); for defendant Township of Mahwah – Nylema Nabbie (Cleary Giacobbe Alfieri Jacobs, LLC, attorney).

In interpreting an exemption under the Statewide Non-residential Development Fee Act, N.J.S.A. 40:55D-8.1 to -8.7, the court found that an urban transit hub must be located within one-half mile radius surrounding the mid point of a New Jersey Transit Corporation, Port Authority Transit Corporation or Port Authority Trans-Hudson Corporation rail station platform area and be specifically delineated by the New Jersey Economic Development Authority (NJEDA). The court found that while the Subject Property was within one-half mile of a qualifying rail station, it was not specifically delineated by the NJEDA and thus was ineligible for the exemption under N.J.S.A. 40:55D-8.4(b)(4). Because the court found the Statute to be unambiguous and plain on its face, it declined to consult extrinsic sources in its interpretation of the statute.

Tax Court: Giant Realty, LLC v. Lavalette Borough; Docket No. 001063-20142014, opinion by Fiamingo, J.T.C., decided April 28, 2022. For plaintiff – Michael I. Schneck (Schneck Law Group, LLC., attorneys); for defendant - Dominic P. DiYanni (Eric M. Bernstein & Associates, LLC, attorneys).

HELD: Plaintiff moved to apply the provisions of the Freeze Act, N.J.S.A. 54:51A-8, for the judgment entered in tax year 2014 to tax years 2015 and 2016. Defendant opposed arguing that the issuance of a permit to develop the subject property under the Coastal Area Facility Review Act, N.J.S.A. 13:19-1 to -51 ("CAFRA"), constituted a change in value so that the Freeze Act should not apply. The court ruled that the issuance of a CAFRA permit in and of itself was insufficient to establish a prima facie case that an external change in the value of the subject property materialized which "substantially and meaningfully" increased the value of the property. Such change can only be demonstrated by showing the value of the property before and after the change. Having failed to make the required prima facie showing, defendant was not entitled to a plenary hearing on the applicability of the Freeze Act. Plaintiff’s motion to apply the Freeze Act was granted.

Tax Court: Twp. of Green v. Life With Joy, Inc.; Docket Nos. 009572-2016 and 009068-2018; Life With Joy, Inc. v. Twp. of Green; Docket Nos. 008566-2017, 013541-2019, 010728-2020; opinion by Bianco, J.T.C., decided March 24, 2022. For Life With Joy, Inc. – Jay J. Freireich (Freireich, LLC., attorney); For Twp. of Green – Robert B. McBriar (Schneck, Price, Smith, & King, LLP., attorneys).

In granting nonprofit status under N.J.S.A. 54:4-6.3, the court found that the Subject Property was actually used in furtherance of the nonprofit’s charitable purpose, to provide a living and learning center for young adults with developmental disabilities, and that any profit-making activity happening on the Subject Property pursuant to state designed and instituted programs was de minimis. The court dismissed the untimely 2019 appeal for lack of jurisdiction. In denying the township’s claim that the exemption must be denied in light of alleged zoning violations, the court revisited the current juxtaposition between municipal land use law and N.J.S.A. 54:4-6.3 presented by Soc’y of the Holy Child Jesus v. City of Summit, 418 N.J. Super. 365, 368 (App. Div. 2011).

Tax Court: Sylvester and Yongjie Touhy v. Director, Division of Taxation, Docket No. 013607-2018; opinion by Bedrin Murray, J.T.C., decided March 1, 2022. For plaintiffs – Sylvester Tuohy and Yongjie Tuohy (Self-Represented); for defendant – Miles Eckardt, Deputy Attorney General (Matthew Platkin, Acting Attorney General of New Jersey, attorney).

Held: Defendant’s motion for summary judgment seeking dismissal of a complaint challenging the assessment of New Jersey gross income tax ("NJ GIT") for tax year 2014 is granted. Plaintiffs contend that defendant improperly added back into their gross income the following: (1) dividends, (2) capital gains, and (3) wages withheld to fund a § 403(b) retirement plan. In addition, plaintiffs argue that defendant erroneously calculated their resident tax credit under N.J.S.A. 54A:4-1 for income subject to tax in other states or political subdivisions. As to the resident tax credit calculation, the court holds plaintiffs are collaterally estopped from relitigating this issue because they unsuccessfully litigated the same issue in the Tax Court for a prior tax year. Even if the principle of collateral estoppel was not applied, plaintiffs’ allegations are without merit based on statutory, regulatory, and case law. With regard to plaintiffs’ challenge to the addition of dividends, capital gains, and certain wages to their 2014 gross income, the court finds their arguments to be unsupported by statutory or regulatory law, or precedent. Thus, plaintiffs have failed to overcome the presumption of validity accorded to defendant’s interpretation of the relevant NJ GIT statutes. Therefore, summary judgment in favor of defendant is appropriate.

Tax Court: Branchburg Hospitality LLC v. Township of Branchburg, Docket No. 011494-21, opinion by Fiamingo, J.T.C., decided February 24, 2022. For plaintiff – Farhan Ali McCarter & English, LLP, attorneys); for defendant - Wesley E. Buirkle (DiFrancesco Bateman Kunzman, Davis, Lehrer & Flaum, P.C., attorneys).

HELD: Plaintiff timely appealed the decision of the County Board of Taxation which dismissed plaintiff’s petition pursuant to N.J.S.A. 54:4-34 (Chapter 91) for tax year 2021. Defendant moved before this court to dismiss plaintiff’s complaint for (a) lack of subject matter jurisdiction; (b) failure to pay taxes pursuant to N.J.S.A. 54:51A-1 and (c) failure to respond to a request for income and expense statement pursuant to Chapter 91. The court denied defendant’s motion to dismiss for lack of subject matter jurisdiction. The court found that plaintiff’s prior filing and withdrawal of a direct appeal as to which a judgment of dismissal was entered, did not bar plaintiff from filing an appeal at the County Board of Taxation for the same tax year, or from appealing the resultant decision of the County Board of Taxation to the Tax Court. The court however dismissed the complaint for failure to pay real property taxes as required by N.J.S.A. 54:51A-1(b) since plaintiff failed to produce sufficient proofs of the impact of COVID-19 on its ability to pay the taxes due. As a result, the court did not reach the merits defendant’s motion to dismiss for failure to comply with Chapter 91.

Tax Court: 3 University Plaza SPE, LLC/3 Univ. Plza SPE % Normandy RE P v. Hackensack City; Docket Nos. 005002-2014, 001670-2015, 003553-2016, 001163-2017, 003768-2018, and 012891-2019, opinion by Novin, J.T.C., decided February 24, 2022. For plaintiff – Michael J. Caccavelli and Grace Chun (Pearlman & Miranda, LLC, attorneys); for defendant – Kenneth A. Porro (Chasan Lamparello Mallon & Cappuzzo, P.C., attorneys).

The court found that no globally accepted practice has been adopted for the handling of tenant improvement allowances and leasing commission expenses under reconstructed operating statements. For local property tax valuation purposes, the decision to include or exclude tenant improvement allowances and leasing commissions, as stabilized operating expenses, is a function of context, the market, and the intended use of the appraisal report. The characterization of tenant improvement allowances and leasing commissions must be based on the appraiser’s examination of a property’s historical operations, and evaluation and analysis of market conditions. When tenant improvement allowances and leasing commission expenses are necessary to achieve economic or market rent, stabilize occupancy, and maintain a property’s value, they may be treated as operating expenses and deducted from effective gross income in calculating net operating income. However, an appraiser may reject certain expenses, including tenant improvement allowances and leasing commissions, when they are erratic, uncharacteristic, and not typical in the market or industry. Here, the court concluded that plaintiff’s expert’s approach, deducting tenant improvement allowances and leasing commissions as "above-the-line" stabilized operating expenses, was reasonable and supported by the trial record. The court further concluded that the Band of Investment technique provided the most accurate and reliable method of deriving a capitalization rate because it is not polluted or impacted by questions of how potential survey recipients perceived hypothetical transactional questions or how a market perceives an annually reoccurring operating expense. Finally, in reducing the property’s 2014 and 2015 tax assessments, the court found that the subject property’s 2019 sale was not credible evidence of true or fair market value. The court scheduled the 2016, 2017, 2018, and 2019 tax year matters for further proceedings.

Tax Court: Erez Holdings Urban Renewal, LLC, v. Director, Division of Taxation and Township of Lakewood, Docket No. 013941-2018, opinion by Sundar, P.J.T.C., decided February 1, 2022. For plaintiff - Catherine J. Bick (Giordiano Halleran Ciesla PC, attorneys); for defendants - Joseph Palumbo, Anthony D. Tancini (Andrew J. Bruck, Acting Attorney General of New Jersey, attorney); Harold H. Hensel (Secare & Hensel, attorneys).

Held: Plaintiff’s contention that the Non-Residential Development Fee (NRDF) imposed under N.J.S.A. 40:55D-8.4 should be computed by attributing $0 to equalized assessed value of the improvements because they are exempt from local property tax under the Long - Term Tax Exemption law, N.J.S.A. 40A:20-1 to -22, is rejected based on the plain language of the NRDF statute. The amount to be excluded for the parking lot when computing the NRDF is its value as determined under the accepted methods employed for valuing all real property in the local property tax arena (cost, income, comparable sales). The court’s standard of review of the assessor’s value determination of the parking lot for purposes of its exclusion when computing the NRDF, is the same as in local property tax matters. Thus, a presumptive correctness attaches to the assessor’s determination with the burden of proof upon the property owner to overcome the same and persuade the court that the exclusion amount should be different. Here, based on the evidence provided, plaintiff failed to persuade the court that the value of the parking lot to be excluded for purposes of calculating the NRDF should be $3,407,000. The court therefore affirms the final determination of defendant, Director, Division of Taxation, that the assessor of defendant, Township of Lakewood, correctly determined the NRDF.

Tax Court: New West Developers, LLC v. Township of Irvington, Docket No. 014704-2013; 010653-2014; 009474-2015; 014706-2013; 010648-2014; 009475-2015; Crown Real Estate Holdings, Inc. v. Township of Irvington, Docket Nos. 009727-2016; 009728-2016, opinion by Bedrin Murray, J.T.C., decided December 23, 2021. For plaintiff – Daniel G. Keough (Ventura, Miesowitz, Keough & Warner, PC, attorney); for defendant – Jarrid H. Kantor (Antonelli Kantor, PC, attorney).

Held: Defendant’s motions to dismiss plaintiffs’ complaints under N.J.S.A. 54:51A-1(b), which requires a taxpayer to satisfy certain local property tax obligations prior to filing an action in the Tax Court, are granted. While the requirement was previously jurisdictional, allowing the court no discretion in determining if a matter should proceed, the statute was amended in 1999 to provide for relaxation of the tax payment provision in the interests of justice. Plaintiff New West, owner of the 15 properties during tax years 2013 through 2015, offers no reason for relaxation. Plaintiff Crown, owner of the properties for tax year 2016, contends its difficulty in ascertaining arrearages owed for all tax years warrants relaxation of the tax payment requirement. The court rejects plaintiff’s argument, holding that the interests of justice would be subverted by allowing the complaints to go forward under the circumstances. In addition, plaintiffs argue that defendant’s failure to object to the non-payment of property taxes when these matters were before the county tax board bars it from raising the same objection in Tax Court. The court holds that while the county tax boards and Tax Court are governed by tax payment provisions under N.J.S.A. 54:3-27 and N.J.S.A. 54:51A-1(b) respectively, they are separate and distinct, and contain different payment schemes. Thus, the court concludes defendant is not barred from raising the objection in Tax Court.

Tax Court: Punish and Indu Malhotra v. Director, Division of Taxation, Docket No. 010788-2018; opinion by Orsen, J.T.C., decided December 16, 2021. For plaintiffs - Punish and Indu Malhotra (Self-represented); for defendant - Miles Eckardt, Deputy Attorney General (Andrew J. Bruck, Acting Attorney General of New Jersey, attorney).

Plaintiffs sought relief from penalties and interest after being assessed for an erroneous income tax refund due to an error on their tax return for New Jersey income tax withholding. Defendant filed a motion for summary judgment seeking recovery of the erroneous refund with applicable penalties and interest. Plaintiffs filed a cross motion for summary judgment requesting that penalties and interest be abated due to the lengthy passage of time for assessment.

The court first determined whether defendant had statutory authority to recover the erroneous refund pursuant to the applicable statute of limitations. Defendant argued that the statute of limitations to obtain the erroneous refund was either three years from the date the tax return was due or an extended five-year statute of limitations due to a misrepresentation of material fact on the tax return. Plaintiff argued that the mistake on the tax return does not qualify as a misrepresentation.

The court found that the three-year statute of limitations expired three years from the making of the refund and the five-year statute of limitations did not apply because plaintiffs’ mistake did not rise to the level of a misrepresentation. Accordingly, the court denied defendant’s motion for summary judgment to recover the erroneous refund. Plaintiffs’ motion for summary judgment was granted to abate the penalties and interest as there was no tax due and any payments made, or tax refunds withheld, were to be returned with applicable interest.

Tax Court: Cargill Meat Solution, Corp. v. Dir., Div. of Tax’n; Docket No. 008146-2018, opinion by Cimino, J.T.C., decided December 15, 2021. For plaintiff - Kyle O. Sollie (Reed Smith LLP, attorneys; Kylie O. Sollie and Matthew L. Setzer on the brief); for defendant – Joseph A. Palumbo, Deputy Attorney General (Andrew J. Bruck, Acting Attorney General of New Jersey, attorney).

Held: The Clean Communities and Recycling Grant Act imposes a user fee, commonly referred to as the litter tax. The fee is based upon the sales of litter-generating products by manufacturers, wholesalers and retailers. Wholesaler-to-wholesaler sales are exempt. While plaintiff admits it manufactures the products at issue, it also asserts the wholesaler-to-wholesaler exemption applies for sales it makes to wholesalers.

The court noted that under plaintiff’s argument, all manufacturers that sell to wholesalers would claim the exemption thus rendering the statutory reference to manufacturer sales superfluous. In addition, the court held that the plain language of the Act provides that the fee is based upon sales within the state, not whether the manufacturing occurred in-state. Moreover, the Legislature did not intend to put local manufacturers at a disadvantage. Finally, the longstanding regulations adopted by the Director provide that the location of where the manufacturing takes place is not determinative.

Tax Court: Ian M. Kunesch v. Andover Twp., Docket Nos. 007226-2013; 007942-2014; 003388-2015; 003298-2016; 000657-2017; 000823-2018; 002702-2019, opinion by Bianco, J.T.C., decided July 29,2021. For plaintiff – Jeffrey D. Gordon (Archer & Greiner, PC, attorney), for defendant – Fred Semrau and Robert J. Rossmeissl (Dorsey & Semrau, LLC, attorney).

Plaintiff, Ian Kunesch ("Mr. Kunesch"), timely filed local property tax appeals with this court for tax years 2013-2019, challenging the assessments imposed by defendant ("Township") on certain real property (“Property”) located in the Township. The Township moved to dismiss those complaints on grounds Mr. Kunesch is not an aggrieved taxpayer within the meaning of N.J.S.A. 54:3- 21, given that he executed a deed in lieu of foreclosure to the lending bank, which stripped him of standing to bring his tax appeals. The court determined that the Township’s motions were without merit, and that Mr. Kunesch has standing to proceed. The court concluded that the lending bank and Mr. Kunesch intended for Mr. Kunesch to remain the owner and in possession of the Property unless he defaulted, at which point the second of two Deeds in Lieu of Foreclosure executed would be recorded. Furthermore, the court found that the second Deed in Lieu of Foreclosure is more appropriately characterized as an equitable mortgage because it was in essence security for a loan. Finally, the court rejected the Township’s argument that Mr. Kunesch was judicially estopped from bringing these tax appeals by finding no miscarriage of justice in proceeding with these matters.

Tax Court: Senior Citizens United Community Services v. Dir., Div. of Tax’n; Docket Nos. 008789-2019 and 005999-2020, opinion by Cimino, J.T.C., decided July 1, 2021. For plaintiff – Dale W. Keith (Keith & Keith, attorneys).; for defendant – Jamie M. Zug (Gurbir S. Grewal, Attorney General of New Jersey, attorney).

Held: The Motor Fuel Tax and the Petroleum Products Gross Receipts Tax provide an exemption for special and rural transportation services provided by "autobuses." The parties disagree as to whether a definition of autobus found in Title 48 (Public Utilities) is incorporated into Title 54 (Taxation). Reviewing the legislative history as well as the wording of the amendments to the exemption statute over the years, the court held that the Legislature did not intend to incorporate the definition of autobus found in Title 48 into Title 54. As a result, the taxpayer qualifies for the exemption.

Tax Court: Michael J. Morley, III, Executor of Estate of Linda A. Cerritelli v. Director, Division of Taxation, Docket No. 007443-2020; opinion by Sundar, P.J.T.C., decided June 7, 2021. For plaintiff - Francis P. Maneri, Kristen L. Behrens, and Sarah Gremminger (Dilworth Paxson, LLP, attorney); for defendant - Heather Lynn Anderson (Gurbir S. Grewal, Attorney General of New Jersey, attorney).

Held: Amounts to be included in the decedent’s gross estate for purposes of New Jersey’s Estate Tax are the sums actually recovered under a survival claim action as provided under the New Jersey Transfer Inheritance Tax laws. The State’s estate tax and inheritance tax statutes can and should be read in pari materia because both laws address the same subject: the corpus or the estate of a decedent, and because assets includible in the estate for estate tax purposes are those which are transferred to a beneficiary for inheritance tax purposes. Therefore, the legislative intent to include the sums actually recovered under a survival claim action in a decedent’s estate for inheritance tax purposes also extends to their inclusion in the decedent’s estate for estate tax purposes. The recovered amounts are deemed to be the value of the survival claim action as of the decedent’s date of death.

Tax Court: R.O.P. Aviation Inc. v. Director, Division of Taxation, Docket No. 001323-2018; opinion by Sundar, P.J.T.C., decided May 27, 2021. For plaintiff – Leah Robinson and Brian Kittle (Mayer Brown LLP, Esq.); for defendant – Michael J. Duffy (Gurbir S. Grewal, Attorney General of New Jersey, attorney).

Held: Plaintiff’s partial summary judgment motion to void defendant’s audit adjustment to its carried forward net operating loss (NOL) deduction is granted and defendant’s cross-motion to amend its expert report to substantiate such adjustment is denied. The NOL deduction in the open (i.e., within the statute of limitations) audited tax years 2012-2015 derive from losses generated in 2007-2011, closed tax years because they were beyond the statute of limitations for audit under N.J.S.A. 4:49-6. Since the closed tax years were never audited by defendant, disallowing the carried forward NOLs from those years is tantamount to reopening and auditing the closed years and indirectly collecting additional tax that flows from the closed years. This is impermissible and time barred under N.J.S.A. 54:49-6. Defendant’s broad discretion under N.J.S.A. 54:10A-10 to determine a taxpayer’s fair and reasonable corporation business tax is nevertheless limited by the four-year statute of limitations under N.J.S.A. 54:49-6. Since the NOL adjustment is time barred, defendant’s cross-motion for partial summary judgment to have its expert’s report amended to substantiate the validity of such adjustment is moot and thus denied.

Tax Court: Ocean Grove Camp Meeting Ass’n of The United Methodist Church v. Township of Neptune, Docket No. 013693-2017; opinion by Sundar, P.J.T.C., decided April 20, 2021. For plaintiff – James M. McGovern, Jr. (Davison, Eastman, Muñoz, Paone, P.A., attorneys); for defendant – Gene J. Anthony (Law Offices of Gene J. Anthony, attorney).

Held: Defendant taxing district’s denial of plaintiff taxpayer’s local property tax exemption under N.J.S.A. 54:4-3.6 is reversed. There is no evidence that the subject property, plaintiff’s Christian retreat center, was leased to for-profit entities or used for non-tax-exempt purposes since the visitors and the activities on the subject property were religious or charitable oriented. That plaintiff did not provide its own religious program, and that it charged fees for overnight stays in its guest rooms does not endanger the tax exemption since N.J.S.A. 54:4-3.6 permits a non-profit charitable entity to be partly supported by occupancy fees, and there is no requirement that plaintiff must wholly occupy the subject property. For the same reason, the fact that plaintiff allows the property to be used by non-profit secular groups or occasionally by individuals does not disqualify the property from tax exemption.

Tax Court: Nicholas L. Gentile, Jr., et al. v. Dir., Div. of Taxation,;Docket No. 013601-2017; opinion by Bedrin Murray,J.T.C., decided March 26, 2021. For plaintiff – Nicholas L. Gentile, Jr. and Doreen A. Gentile (Self-Represented); for defendant – Jamie M. Zug (Gurbir S. Grewal, Attorney General of New Jersey, attorney).

Held: Defendant’s motion for summary judgment seeking dismissal of a complaint challenging the assessment of New Jersey gross income tax (“GIT”) as to an “innocent spouse” husband is denied. Plaintiffs, a married couple filing jointly, failed to report approximately $900,000 in income for tax years 2006-2010 that the wife, an accountant, attained from criminal activity unknown to her husband. Plaintiffs urge the husband should be relieved of joint and several liability attaching to joint GIT filers under N.J.S.A. 54A:8-3.1(c), citing the equitable remedy afforded to an “innocent spouse” in 26 U.S.C. § 6015. Defendant contends no such relief is afforded a taxpayer under New Jersey law; further, plaintiffs’ joint and several liability for GIT includes profit from criminal activity under N.J.S.A. 54A:5-1(o). An audit of plaintiffs’ tax returns resulted in an assessment and civil fraud penalty being imposed after expiration of the three-year statutory period for assessing GIT under N.J.S.A. 54A:9-4(a). As such, there must be a showing that “[a] false or fraudulent return [was] filed with intent to evade tax.” Ibid. The record is devoid of proof that the husband filed a false or fraudulent return for tax years 2006-2010 with an intent to evade tax, nor is any such claim advanced by defendant. Defendant’s reliance on the absence of innocent spouse relief under New Jersey law in support of the motion is misplaced. Joint and several liability of taxpayers filing joint GIT returns does not relieve defendant of the burden to prove the statutory exemption set forth in N.J.S.A. 54A:9-4(c)(1)(B). See Anita K. Leather v. Dir., Div. of Taxation, 31 N.J. Tax 285 (Tax 2019). As the record is unsettled in this regard, defendant’s motion for summary judgment is not ripe.

Tax Court: Nicholas L. DePace M.D. v. Dir., Div. of Taxation; Docket No. 013396-2019, opinion by Cimino, J.T.C., decided December 21, 2020. Released for publication: March 10, 2021. For plaintiff – Jack A. Myerson and Matthew L. Miller (Myerson & O’Neill, attorneys).; for defendant – Ramanjit K. Chawla, Deputy Attorney General (Gurbir S. Grewal, Attorney General of New Jersey, attorney).

Held: Under existing law, Gross Income Tax is due from both the qui tam plaintiff and the attorney representing the qui tam plaintiff on the portion of the award payable to the attorney as fees. Qui tam actions are brought by private citizens on behalf of the government alleging waste and fraud. The private citizen is entitled to an award which constitutes a percentage of the government’s recovery. While an argument can be made that only the attorney is liable for Gross Income Tax on the attorney’s fee portion of the award, a recent attempt to change the law to only tax the attorney was vetoed by the Governor. The court is constrained to respect the legislative process for which the Governor is a part.

Tax Court: Washington Shopping Center, Inc. v. Washington Township;Docket Nos. 005517-2016, 002869-2017, 006408-2018, opinion by Novin, J.T.C., decided February 11, 2021, and released for publication March 2, 2021. For plaintiff – Lawrence S. Berger (Berger & Bornstein, LLC, attorneys); for defendant - Martin Allen (Di Francesco, Bateman, Kunzman, Davis, Lehrer & Flaum, P.C., attorneys).

During trial, the court concluded that plaintiff could not compel the testimony of defendant’s proposed testifying expert against the proposed testifying expert’s wishes, or without his consent. Additionally, the court determined that plaintiff offered no evidence that defendant’s proposed testifying expert witness possessed superior knowledge of the facts or that his testimony would have elicited more meaningful insight into the property than plaintiff’s testifying expert. Accordingly, the court declined to apply an adverse inference charge. The court further concluded that post-trial briefs must be confined to the facts disclosed in the trial record, or those reasonably suggested by the evidence introduced during trial. In affirming the local property tax assessments, the court found plaintiff’s expert’s highest and best use analysis flawed and his conclusion that approximately sixty-one percent of the subject property’s building area should be demolished not credible.

Tax Court: Fifth Third Equipment Finance Co. v. Dir., Div. of Taxation,span> Docket No. 013380-2018, opinion by Sundar P.J.T.C., decided February 23, 2021. For plaintiff - Kenneth R. Levine argued the cause, Kyle O. Sollie, attorney of record and on the brief; Matthew L. Setzer, on the brief (Reed Smith, LLP, attorneys); for defendant - Michael J. Duffy (Gurbir S. Grewal, Attorney General of New Jersey, attorney).

Held: N.J.S.A. 54:10A-4(k)(6)(E) (Subparagraph E) disallowed a deduction of net operating loss (NOL) carryovers for tax years 2002-2005 (100% for 2002 and 2003, 50% for 2004 and 2005), but also extended the normal seven-year period of the carryover losses for a period commensurate with the suspension period(s) “if and only to the extent” the NOL carryover deduction was disallowed under Subparagraph E. Defendant’s construction that Subparagraph E does not permit extending the carryover period if in a suspension period there was no income to absorb an NOL carryover, is reasonable. Consideration must be given to the first-in-line, first-in-time sequence of using an NOL carryover specified in N.J.S.A. 54:10A-4(k)(6)(B) for purposes of implementing Subparagraph E. While plaintiff is incorrect in arguing that the extension period for NOL carryovers is four years for each NOL carryover that could have been used to offset income in the suspension year(s), the court agrees, in part, with plaintiff’s proffered computation of the NOL carryovers and extension periods under defendant’s construction of Subparagraph E. Although defendant did not apply its regulation, N.J.A.C. 18:7-5.17(c), in computing the extension period(s) and amount of NOL carryovers but followed a 2015 bench opinion of the Tax Court in this regard, the court finds the regulation invalid as it imposes a condition beyond the scope of the language and intent of Subparagraph E. The court affirms defendant’s denial of plaintiff’s refund claim attributable to the Alternative Minimum Assessment tax credits.

Tax Court: Andrew & Laura Botwin v. Dir., Div. of Taxation, Docket No. 013411-2019; opinion by Bianco, J.T.C., decided February 23, 2021. For plaintiffs – Andrew Botwin (self-represented); for defendant – Miles Eckardt (Gurbir S. Grewal, Attorney General of New Jersey, attorney).

Plaintiffs, Andrew and Laura Botwin, sought to transfer the trade-in tax credit from the purchase of their first vehicle which was returned under the Lemon Law (N.J.S.A. 56:12-32(a)(1)), to a subsequent purchase of another vehicle from a different dealer. The court determined that the defendant, Director, Division of Taxation, was entitled to summary judgment under R. 4:46-2(c), finding that the Botwins did not qualify for a trade-in credit on the purchase of the second motor vehicle under the plain language of N.J.S.A. 54:32B-2(oo) and N.J.A.C. 18:24-7.4, because their purchase of the second vehicle and the use of their trade-in vehicle for a reduction in sales price did not occur at the same time as contemplated by the law. The court concluded that when the Botwins accepted a full refund for their first vehicle as their relief under the Lemon Law, as opposed to a replacement vehicle, they surrendered their trade-in credit on the purchase of a second vehicle from another dealer. The court also rejected the Botwins’ argument that they were double taxed because in this case there were two separate, taxable events under N.J.S.A. 54:32B-3(a), and they were reimbursed for taxes paid for the first vehicle.

Tax Court: Eagle Rock Convalescent Center v. Township of West Caldwell; Docket Nos. 006780-2008; 008154-2009; 002089-2010; 010834-2011; 000264-2012; 000868-2013; 005687-2014, opinion by Nugent, J.T.C., decided January 6, 2021. For plaintiff – Daniel J. Pollok, Esq. (Brach Eichler L.L.C., attorneys); for defendant – Levi Kool*, Esq. (O’Donnell McCord, P.C., attorneys).

*Levi Kool argued the matters but the opinion is being sent to the current municipal attorney, Joseph McGlone.

Taxpayer, Nursing Home filed complaints alleging the property was over-assessed. Utilizing the income and cost approaches Taxpayer’s appraisal expert reconciled the concluded values opining that the property’s market value exceeded the value as equalized. Under the income approach the expert utilized the property’s actual income and expenses as economic rent in the absence of market leases. The court rejected the proofs as insufficient and found the allocation between income attributable to the business versus the real estate to be lacking. The court found the value conclusion reached under the cost approach unreliable where Taxpayer’s expert utilized the Marshall & Swift, SwiftEstimator computer program for all tax years. The program’s scientific reliability has yet to be established, and it yielded inconsistent results in this case. West Caldwell relied on two appraisal experts who both utilized only the cost approach. Because of a town-wide 2011 revaluation, West Caldwell’s revaluation first expert opined on value for tax years 2011 and 2012. The second expert utilized the SwiftEstimator software for the remaining tax years a method not accepted by the court, and where the proofs revealed a similar inconsistency in the computer output. The assessments were affirmed for lack of proofs for tax years 2008-2010, and 2013 and 2014. The court accepted Taxpayer’s expert’s land value, and the replacement cost new under the cost approach opined by West Caldwell’s revaluation expert using the Marshall & Swift calculator method. The court found no basis to apply external obsolescence or functional non-curable obsolescence but applied depreciation for physical and functional curable obsolescence. Finding the assessments for tax years 2012 fell within the common level range the court affirmed the assessment. The court also affirmed the assessment for tax year 2011 since West Caldwell did not file a counterclaim, thus, the court cannot increase the assessment.

Tax Court: Township of Freehold v. CentraState Healthcare Services, Inc., Docket Nos. 000047-2016; 000048-2016; opinion by Sundar, J.T.C., decided January 5, 2021. For plaintiff – Martin Allen, Esq. (DiFrancesco Bateman et al., P.C. (Kevin A. McDonald, Esq. and Wesley E. Buirkle, Esq., on the brief); for defendant – David B. Wolfe, Esq. (Skoloff & Wolfe, P.C.)

Held: Plaintiff taxing district’s omitted assessment complaints for tax years 2014 and 2015 are dismissed for failure to file timely appeals. Although the court, in January 2018, after reconsideration, had granted partial summary judgment motions to plaintiff taxing district denying local property tax exemption to an office condominium owned by defendant (CHSI) because CHSI was a for-profit entity, the lack of the court’s subject matter jurisdiction can be raised at any time, especially as to non-final interlocutory orders. Therefore, although CHSI’s motions do not state a cause of action for reconsideration under R. 4:49-2, the court deems them as motions to dismiss under R. 1:6-2 for untimely filing. Those motions are granted pursuant to the ruling in Borough of Red Bank v. RMC-Meridian Health, 30 N.J. Tax 551 (Tax 2018), aff’d, 2019 N.J. Super. Unpub. LEXIS 574, *1 (App. Div.), motion for leave to appeal denied, 238 N.J. 455 (2019), and the taxing district’s omitted assessment complaints are dismissed for lack of subject matter jurisdiction. As a result of the dismissals, claims raised by both parties pertaining to valuation of the property do not survive.

Tax Court: 30 Journal Square Partners, LLC v. City of Jersey City Docket No. 9666-2020; opinion by Brennan, J.T.C., decided December 30, 2020. For plaintiff – David B Wolfe (Skoloff & Wolfe, P.C.,attorneys); for defendant – David J. Yanotchko (Florio Kenny Raval,LLP, attorneys) and Robert D. Blau (Blau & Blau, attorneys).

Taxpayer’s motion requesting an Order verifying the exclusive jurisdiction of the Tax Court in the event of a dual filing with both the Tax Court and the County Board of Taxation, and requiring the party that filed with the County Board of Taxation to withdraw their appeal(s) with prejudice. The Tax Court confirmed its exclusive jurisdiction but ordered the county board filer to request a judgment of dismissal without prejudice from the County Board of Taxation. The court held that N.J.S.A. 54:3-21(a) did not require a withdrawal with prejudice of the county board petition(s) thereby limiting the party that filed with the county board to a timely counterclaim in order to proceed with its independent right to litigate a property tax appeal.

Tax Court: B & D Assoc., LTD. v. Township of Franklin Docket Number 6112-2017 and 6387-2018, opinion by Brennan, J.T.C.,decided October 26, 2020. For plaintiff – Lawrence S. Berger (Berger & Bornstein LLC, attorneys); for defendant – Gregory B. Pasquale (Shain Schaffer PC, attorneys)

Held: The municipality’s summary judgment motion was denied.Municipality’s summary judgment motion challenged a property owner’s standing to pursue tax appeals during a time when the property was in foreclosure and tax payments were made by the mortgagee. The Tax Court found that an owner of real property has a sufficient stake in the property’s tax assessment while it holds title to the property and therefore qualifies as an aggrieved taxpayer pursuant to N.J.S.A. 54:3-21. The court held that plaintiff had standing to appeal the 2017 and 2018 tax assessments as it held title to the property until at least August 8, 2018, which was beyond the October 1 valuation date and the April 1 filing date for those years.

Tax Court: Metz Family Ltd. Partnership v. Township of Freehold, Docket Nos. 001064-2015; 000482-2016; 000783-2017;opinion by Sundar, J.T.C., decided October 20, 2020. For plaintiff - Daniel J. Pollak and Michael Rienzi (Brach Eichler, L.L.C. attorney); for defendant - Martin Allen and Wesley E. Buirkle (DiFrancesco, Bateman, Coley, Yospin, Kunzman, Davis, Lehrer & Flaum, P.C., attorney); for the Monmouth County Board of Taxation and the Director, Division of Taxation - Abiola G. Miles and Michelline Capistrano Foster (Gurbir S. Grewal, Attorney General of New Jersey, attorney).

Held: Defendant’s motions to require joinder of the Monmouth County Board of Taxation and the Director, Division of Taxation under R. 4:28-1 are granted. Only these two governmental entities can explain why they considered, verified, and certified the annual assessments in the defendant to be “reassessments” excepted from the application of the Chapter 123 ratio (or the average ratio), which is an issue of first impression and involves significant public interest.

Tax Court: Grace Ashkenazi v. Borough of Deal, Docket Nos.003252-2016; 000434-2017; 000107-2018; 001026-2019, opinion by Sundar, J.T.C., decided October 2, 2020. For plaintiff – Michael I. Schneck (Schneck law Group, LLC, attorney); for defendant – Martin M. Barger (Barger & Gaines, attorney).

Held: Plaintiff’s appraiser’s sales comparison approach as a valuation methodology for the subject property, a 11,330 square-feet single-family home located on a 2.54-acre lot, is rejected due to the quantum of adjustments and reliance on a computer-generated linear regression computation as the basis for certain adjustments. The court agrees with defendant’s appraiser (who found the subject property’s value to be lesser than the assessment for each tax year) that the cost approach was the most credible valuation methodology and accepts his land value conclusions. Based on the cost data included in plaintiff’s appraiser’s report, and other credible cost provisions, and after using higher depreciation rates than used by defendant’s appraiser, the court finds the value of the subject property at an amount lesser than defendant’s appraiser value conclusions for each tax year. The court will decide the issue of whether the average ratio should apply in a separate hearing.

Tax Court: National Winter Activity Center v. Dir., Div. of Taxation, Docket No. 008480-2017; opinion by Bianco, J.T.C., decided September 25, 2020. For plaintiff – Cara A. Parmigiani (Law Office of Cara A. Parmigiani LLC, attorney); for defendant - Joseph A. Palumbo (Director, Division of Taxation, attorney); for movant – Joshua A. Zielinski (O’Toole Scrivo, LLC, attorneys).

The court held that the movant, Vernon, satisfied the requirements for intervention as of right under R. 4:33-1, and granted Vernon’s motion to intervene, finding that Vernon has a legitimate interest in the subject of the litigation due to its authorization to use the funds in its municipality to further the purposes of the Fair Housing Act (N.J.S.A. 52:27D-301 to 329.9). The court also found that Vernon’s interest in the litigation was not adequately represented by the named defendant, the Director, and that the Municipality’s presence is necessary in cases where it is the ultimate user of the funds. Further, the court decided that Vernon’s application is timely because Vernon did not have actual notice of the pending litigation. The court rejected the Plaintiff’s motion to transfer the fees held in escrow by Vernon to the State because Vernon is the ultimate user of the funds, given that Vernon has obtained authorization to assess and maintain Non-Residential Development Fee funds under N.J.S.A. 52:27D- 329.2(a),(b).

Tax Court: Erin B. O’Connell v. Township of Neptune, Docket No. 009646-2020, opinion by Sundar, J.T.C., decided September 23, 2020. For plaintiff – Erin B. O’Connell (self-represented);for defendant – Gene J. Anthony (Law Offices of Gene J. Anthony, attorney).

Held: Defendant’s motion to dismiss plaintiff’s complaint as untimely filed is denied. Although plaintiff’s complaint to the Tax Court was filed on June 30, 2020, thus, beyond the deadline for filing complaints from the judgment of a county board of taxation, she benefits from the filing deadline extension due to COVID-19. Such extension was specifically provided for by the Orders of the New Jersey Supreme Court which culminated into law (L. 2020, c. 35). Although that law specifically excepts the tolling of appeal deadlines for properties which are located in Monmouth County (since Monmouth County participates in the Assessment Demonstration Program), and plaintiff’s property is located in Monmouth County, it does not affect the court’s conclusion. This is because the law applies only to “appeals filed with a county board of taxation,” and not as here, to appeals filed with the Tax Court from a county board of taxation’s judgment.

Tax Court: Glenpointe Associates, Glenpointe Associates II, LLC, and Glenpointe Associates III v. Township of Teaneck; Docket Nos. 004987-2007; 004989-2007; 004982-2007; 004984-2007; 004989-2007; 004992-2007;002967-2008; 002975-2008; 002977-2008; 002982-2008; 002987-2008; 001623-2009; 001638-2009; 001639-2009; 001640-2009; 001642-2009; 017684-2009;002077-2010; 002080-2010; 003183-2010; 003198-2010; 003207-2010;020410-2010; Opinion by Andresini, P.J.T.C., decided August 11, 2020.For plaintiff - Carl A. Rizzo (Cole Schotz P.C., attorneys); for defendant - Kenneth A. Porro and Edna J. Jordan (Chasan Lamparello Mallon & Cappuzzo, P.C., attorneys).

Held: In the valuation of an office complex portion of the subject property with exceptional quality, amenities, and location, the court concluded that the leases contained in the subject office are the best metric for determining economic rent. The court further found that plaintiff taxpayers’ claims that the subject leases must be adjusted to reflect alleged above market leasing commissions while simultaneously taking an expense for the commission is not a valid appraisal practice supported by any accepted source or methodology. Furthermore, adjustments made to comparable leases from the subject market must be grounded in cognizable data and may not be applied in an arbitrary fashion, though when stripped of arbitrary adjustments the comparable leases may still be of probative value in determining economic rent. Additionally, the use of outlier capitalization rates without adequate justification or support on the record renders those figures unreliable to the court in determining the fair market value of the subject.

The court further concluded that in the valuation of a hotel portion of the subject property, it cannot accept plaintiffs’ expert’s conclusions as valid or credible when the expert relies on lower-end data sets and improper hotel classification as the basis for his valuation conclusions. When relying on competitive hotel sets, an expert must base his conclusions on the correct classification of the subject hotel and rely on adequately comparable sources of hotel data from within that classification. An expert’s reliance on inferior hotel properties in his competitive set cannot be afforded any weight. Further, the court cannot accept capitalization rates based on unsubstantiated theories of risk without support in the record.

Tax Court: Carmine Paul, Executor v. Director, Division of Taxation; Docket No. 000307-2016, opinion by Nugent, J.T.C., decided June 2, 2020. For plaintiff – Thomas M. Wolfe (Wolfe Ossa Law, attorneys); for defendant – Heather Lynn Anderson (Gurbir S. Grewal, Attorney General of New Jersey, attorney).

Decedent formed an irrevocable inter vivos trust in June 2007, funded with cash and securities, naming himself and his son-in-law, Carmine Paul, as trustees. By the terms of the Trust Indenture the trustees were required to pay to Decedent the net income from the trust on a quarterly basis. Trustees had the discretion to distribute principal to the beneficiaries in an amount limited by the trust, but Decedent was not entitled to any distribution of trust principal. At Decedent’s death, the remaining trust property was to be distributed to the beneficiaries named in the Trust Indenture. Prior to his death Decedent suffered a stroke and Carmine Paul assumed the role of trustee. Decedent continued to receive net income distributions from the trust until his death in 2013. After Decedent’s death Defendant audited the New Jersey Resident Decedent Inheritance Tax return and included in Decedent’s estate the value of the trust. Defendant found that Decedent had reserved a life estate in the trust income and assessed inheritance tax on the assets under N.J.S.A. 54:34-1(c) as a transfer “intended to take effect in possession or enjoyment at or after . . . death.” In challenging the tax, Plaintiff claimed that because the trust authorized the trustees to distribute principal to the beneficiaries on a discretionary basis, Decedent never retained a life estate in the property since the trustees could have drained the trust principal. Moreover, Plaintiff claimed the court should apply N.J.S.A. 54:34-1.1 to exempt the property from tax. The court finds that neither the statutes nor the case law provides support for Plaintiff’s claim. The facts fit within the plain text of the statutes, where Decedent reserved an interest in the property transferred for a period measured by Decedent’s life. Moreover, N.J.S.A. 54:34-1.1 requires that a Grantor who retained an interest in the property transferred must execute in writing a complete disposition of the property interest more than three years prior to death. Plaintiff failed to meet his burden of proof to establish that the transfer was outside the reach of the “at or after death” provision of the statute or that Decedent executed a timely and complete disposition of his interest in the property. Accordingly, the court grants Defendant’s motion for summary judgment affirming the assessment.

Tax Court: Scott Dickerson v. Town of Dover,Docket Nos. 005403- 2010; 004187-2011; 008887-2012; opinion by Bianco, J.T.C., decided March 30, 2020. For plaintiff – Joseph G. Buro (Zipp & Tannenbaum, LLC, attorneys); for defendant – David C. Pennella (Law office of David C. Pennella, attorneys).

Held: The Saturday, June 1, 2019 deadline for defendant to remit the refund payment to plaintiff without interest cannot be extended to Monday, June 3, 2019 pursuant to R. 1:3-1, N.J.S.A. 36:1-1, or equitable principles, given that the Saturday, June 1, 2019 deadline was not a court-ordered payment date, but rather a contractual deadline negotiated between the parties and set forth in the Stipulation of Settlement.

Tax Court: Buckeye Perth Amboy Terminal, LLC, v. City of Perth Amboy;Docket No. 013403-2019; opinion by Sundar, J.T.C.,decided March 27, 2020. For plaintiff - John S. Wisniewski (Wisniewski & Associates, LLC, attorneys); for defendant -William T. Rogers (Hoagland, Longo, Moran, Dunst & Doukas,LLP, attorneys).

Held: Defendant’s imposition of an assessment in September 2019 for tax year 2019, to capture the assessment on a bidirectional petroleum pipeline that was constructed and placed in service in May 2018, is proper under the omitted assessment statute, N.J.S.A. 54:4-63.31, although defendant’s assessor called it an “added” assessment in the assessment notice. The newly constructed pipeline was assessed for the first time in 2019. Therefore, precedent voiding added or omitted assessments to change an already-imposed regular assessment (even if the improvement was valued at $0) does not control. Additionally, the omitted assessment statute presupposes the existence of an improvement as of an assessment date; therefore, invalidating an assessment on this ground cannot be supported under the statute’s plain language, or its underlying intent and purposes as interpreted by our higher courts.

Tax Court: Pella Realty, LLC v. Paterson City; Docket Nos. 002345-2017 and 002348-2017; opinion by Novin, J.T.C., decided February 27, 2020. For Pella Realty, LLC – Peter J. Zipp and Joseph G.Buro (Zipp & Tannenbaum, LLC, attorneys); for Paterson City –Michael T. Wilkos (Florio Kenny Raval, LLP, attorneys); for amicus curiae, Director, New Jersey Division of Taxation – Abiola G. Miles and Michelline Capistrano Foster (Gurbir S. Grewal, Attorney General of New Jersey, attorney).

The court concluded that the Director of the New Jersey Division of Taxation’s regulation sanctioning use of an annual reassessment program, under N.J.A.C. 18:12A-1.14(i), was intended for counties electing to adhere to the Real Property Assessment Demonstration Program, N.J.S.A. 54:1-101 to -106 (the “RPADP”). During the tax years at issue, Passaic County was not a "demonstration county" under the RPADP, therefore, Paterson’s implementation of an annual reassessment program was improper. Moreover, the court found that implementation of an annual reassessment program under N.J.A.C. 18:12A-1.14(i) does not preclude application of the Freeze Act, N.J.S.A. 54:51A-8, as same does not constitute a complete reassessment of all real property in the taxing district. Finally, the court found that the Director inappropriately determined that Paterson’s annual reassessment program should receive credit for completion of a district-wide reassessment and recognition in the Director’s annual Certified Table of Equalized Valuations. Therefore, the court will conduct a plenary hearing to determine whether the annual reassessment program implemented by Paterson satisfied the district-wide reassessment criteria as expressed under established legal authority, N.J.A.C. 18:12A-1.14(c), and the Application for Full Reassessment, Form AFR.

Tax Court: Stanard v. Dir., Div. of Taxation, Docket No. 008149-2018; opinion by Fiamingo, J.T.C., decided February 24, 2020. For plaintiff - Joseph Kernen and Ellis L. Reemer (DLA Piper, LLP, attorneys); for defendant – Ramanjit K. Chawla (Gurbir S. Grewal, Attorney General of New Jersey, attorney).

Tax Court: Saulwil, Inc. v. Dir., Div. of Taxation, Docket No. 014062-2013; Samuel and Louise Hammer v. Dir., Div. of taxation, Docket No. 014061-2013; opinion by Sundar, J.T.C.,decided January 10, 2020. For plaintiff – Robert A. Fee (Robert A. Fee, Esq., attorneys); for defendant - Heather Lynn Anderson (Gurbir S. Grewal, Attorney General of New Jersey, attorney).

Held: Defendant’s decision that the books and records of corporate plaintiff were inadequate, which therefore required that its reported sales be increased using an estimated markup, was unreasonable and unsupportable. Therefore,defendant’s final determination assessing additional sales tax on the corporate plaintiff based on its markup methodology is reversed. Also reversed is defendant’s final determination imposing additional gross income tax upon the individual plaintiffs on the constructive receipt of the deemed additional corporate sales.

Tax Court: Plaza Twenty Three Station, LLC v. Township of Pequannock, Docket Nos. 002870-2018; 002215-2019; 000062-2019; opinion by Bianco, J.T.C., decided January 9, 2020; published opinion January 22, 2020. For plaintiff – Daniel P. Zazzali and Michael D. Benak (McCarter & English, LLP, attorneys); for defendant – Robert H. Oostdyk, Jr. (Murphy McKeon, PC, attorneys).

HELD: The court invalidated the 2018 and 2019 local property tax assessments, along with a 2018 added assessment, imposed by defendant upon the subject property owned by plaintiff. The court found that these assessments were based on and carried forward, the 2017 added assessment, which this court had held constituted an unconstitutional spot assessment, the same being based on the 2017 sale of the subject property.

Tax Court: City of Plainfield v. Borough of Middlesex, Docket No. 000160-2019; opinion by Sundar, J.T.C., decided December 24, 2019. For plaintiff - John S. Wisniewski (Wisniewski & Associates, L.L.P., attorneys); for defendant - Michael P. O’Grodnick (Savo, Schalk, Gillespie, O’Grodnick & Fisher, P.A., attorneys).

Held: Property owned by plaintiff, City of Plainfield, located in defendant, Borough of Middlesex, is exempt from local property tax under N.J.S.A. 54:4-3.3. The exemption is not lost because a portion of the property is undisputedly used by defendant and the general public for public purposes, and the remainder is retained in its natural wooded state.

Tax Court: Jesse Wolosky v. Fredon Twp. and Michael & Penny Holenstein, Docket Nos. 008267-2016; 009548-2017; 010326-2018; opinion by Bianco, J.T.C., decided December 18, 2019. For plaintiff – Walter M. Luers (Walter M. Luers, LLC, attorneys); for defendant Fredon Twp. - William E. Hinkes (Hollander, Strelzik, Pasculli, Hinkes, Wojcik, Gacquin, Vandenberg & Hontz, L.L.C., attorneys); for defendants Michael and Penny Holenstein - Tara Ann St. Angelo (Gebhardt & Kiefer, P.C., attorneys); for the Amicus Curiae, Association of Municipal Assessors of New Jersey - John R. Lloyd (Chiesa Shahinian & Giantomasi, P.C., attorneys).

Tax Court: Valentina Tartivita v. Borough of Union Beach, Docket No. 007705-2018; opinion by Sundar, J.T.C., decided December 9, 2019. For plaintiff – Valentina Tartivita (Self- Represented); for defendant – John T. Lane, Jr., Esq.
Held: Plaintiff is entitled to the benefit of the relief under the Freeze Act for tax year 2018 based on a final judgment of the Monmouth County Board of Taxation for tax year 2017. There was no evidence of internal or external changes to the subject property, plaintiff’s residence. Further, defendant’s annual assessments do not equate to a “complete reassessment” under the Freeze Act statute N.J.S.A. 54:3-26 or a “district-wide reassessment” under the regulations, N.J.A.C. 18:12A-1.13; 12-1.14(c). Therefore, defendant failed to meet its burden that Freeze Act relief is unavailable to plaintiff for tax year 2018.

This is the court's opinion after trial of the above-captioned matter wherein Chaxisma Byrd (“Taxpayer”) challenged the Final Determination of the Director, Division of Taxation (“Taxation”). Taxation denied Taxpayer’s claim for the New Jersey Earned Income Tax Credit (the “EITC”) in the amount of $1477 for the tax year 2016. For the reasons set forth below, Taxation’s decision is reversed.

Tax Court: Anita K. Leather v. Director, Division of Taxation, Docket No. 000852-2018; opinion by Sundar, J.T.C., decided October 23, 2019. For plaintiff – Anita Leather (Self-Represented); for defendant – Gurbir S. Grewal, ttorney General of New Jersey (Miles Eckardt, Deputy Attorney General).

Held: Defendant’s motion for summary judgment seeking dismissal of plaintiff’s complaint challenging the assessment of New Jersey gross income tax (“GIT”) is enied. Although legally obtained Department of Veterans Affairs (“VA”) disability benefits are exempt from GIT, if such benefits are fraudulently obtained, as plaintiff’s ex-husband did during tax years 2000-2009 when plaintiff and he were married and filed joint tax returns, then the benefits are subject to GIT under N.J.S.A. 54A:5-1(o) as income from a criminal act. As defendant assessed plaintiff after the normal three-year statute of limitations had expired, for suspension of the same and for the assessment to stand, the returns subject to assessment must have been “false or fraudulent” and “filed with an intent to evade tax.” N.J.S.A. 54A:9-4(c)(1)(B). Such intent must be evinced by “conduct intended to conceal, mislead, or otherwise prevent the administration and collection of the taxes imposed by the laws of this State.” N.J.A.C. 18:2-2.9(b); 2.9(d). The facts in support of defendant’s summary judgment motion only show that plaintiff did not know that her then-husband’s VA benefits were obtained by fraud, or whether the benefits were includable as income, and that she reported the benefits to the CPA who prepared the GIT returns. Defendant however presented no evidence to prove that plaintiff filed a false or fraudulent GIT return for tax years 2000-2009 with an intent to evade tax that was known to be due. The statute of limitations thus acts to bar granting summary judgment as a matter of law. The lack of evidence in support of an intent to evade tax similarly means that defendant is not entitled to summary judgment with respect to the 50% civil fraud penalty imposed on plaintiff. Because summary judgment is denied on statutory grounds, there is no need to address plaintiff’s equitable argument that she should be afforded “innocent spouse relief” like that available under the I.R.C. § 6015.

Tax Court: EGDC C/O AM Resurg Mgmt v. Rutherford Borough, Docket Nos. 004521- 2012, 002730-2013, 002112-2014, 003453-2015, 003586-2016, 003546-2017; opinion by Orsen, J.T.C., decided October 16, 2019. For plaintiff — Amber N. Heinze (Irwin & Heinze, P.A., attorneys); for defendant — Kenneth A. Porro (Chasan, Lamparello, Mallon & Cappuzzo, P.C., attorneys).

Plaintiff, EGDC C / O AM Resurg Mgmt, sought property tax relief for the 2012 through 2017 years.Defendant, Rutherford Borough, filed a motion for partial summary judgment seeking entry of an order determining that plaintiff’ s properties be valued as a single economic unit along with two other properties owned by a third party.Defendant maintained that a reciprocal easement agreement executed between the parties created a unity of use and unity of ownership between all of the parcels.The court determined that the agreement failed to show a unity of use between the parcels. Moreover, the court found that the agreement did not create a unity of ownership or beneficial ownership between the separate owners of the parcels.Accordingly, the court denied defendant’ s motion for partial summary judgment for the parcels to be treated as a single economic unit.

Tax Court: City of Newark v. Twp. of Jefferson, Docket Nos. 006324-2016, 007392-2015, 007399-2015, 007940-2014, 007937-2014; City of Newark c / o NWCDC v.Twp.of Jefferson, Docket Nos.006324 - 2016,007392 - 2015; City of Newark c / o Newark Watershed Corp.v.Twp.of Jefferson,Docket Nos.005970 - 2012, 005969 - 2012; City of Newark c/o Newark Watershed v.Twp.of Jefferson, Docket Nos.005555 - 2011, 008214 - 2010, 008215 - 2010; Newark Watershed Corp.v.Twp.of Jefferson;Docket Nos.013604 - 2009, 013606 - 2009, 013601 - 2009;opinion by Bianco, J.T.C., decided October 3, 2019. For plaintiff– Philip Elberg(Medvin & Elberg, attorneys);for defendants - Lawrence P.Cohen(Lavery, Selvaggi, Abromitis & Cohen, P.C., attorneys).

Held: The court affirmed the assessments of the subject property, awatershed, rejecting both the plaintiff’ s and defendant’s expert appraisers’ respective conclusions of value under the Sales Comparison Approach.The court also rejected plaintiff’ s expert appraiser’s conclusion that the highest and best use of the subject property was timber harvesting as unsupported since the expert appraiser could not find one sale of land in New Jersey that was soldfor timbering purposes.Plaintiff’ s expert appraiser further failedto show comparability between the heavily wooded and deed - restrictedsubject property in northern New Jersey and proposed comparable sales of deed - restricted farmland in southern New Jersey.The court alsorejected defendant’ s expert appraiser’ s proposed comparable sales of deed - restricted properties to not - for -profit corporations and public entities, given that he made no adjustments for the differences in the restrictions between those proposed comparables and the subject property.

This opinion decides whether the mobile baking pan racks (“Racks”) used by plaintiff in its business of manufacturing baked products are subject to use tax. The amount of tax in dispute is $19,319.65 (exclusive of interest and penalties). Plaintiff claims that the Racks are indispensable to the manufacturing process, and therefore, are exempt under N.J.S.A. 54:32-8.13(a), which statute exempts from tax (sales or use), receipts from sales of “machinery, apparatus, or equipment” (hereinafter “MAE”) which is used or consumed “directly and primarily in the production of tangible personal property by manufacturing, processing, assembling or refining.” Defendant claims that the exemption does not apply to the Racks because they are trolleys akin to dollies, used for the convenience of plaintiff to manually transport the to-be-baked products from one area to another since they are too heavy to be carted or carried by foot.

Tax Court: NJ DEP/UFT c/o Cream Ridge Golf, LLC v. Twp of Upper FreeholdDocket No. 007457-2017; opinion by Gilmore, J.T.C., decided July 26, 2019. For plaintiff Cream Ridge Golf, LLC – Katherine B. Galdieri (The Kelly Firm, PC, attorneys); for plaintiff NJ DEP/UFT – Jamie M. Zug (Gurbir S. Grewal, Attorney General of New Jersey, attorney); for defendant – Dennis Anthony Collins (Collins, Vella and Casello, LLC, attorneys).

For-profit taxpayer/operator of State-owned golf course sought exemption from local property taxes for the subject property, which includes a golf course, pro shop, driving range, restaurant, and maintenance buildings. NJ DEP/UFT joined action in support of exemption. Taxpayer moved for summary judgment and the defendant, Township of Upper Freehold opposed. Held: Operation of State-owned golf course by for-profit entity furthers public purpose of development of lands by the State for recreational purposes. Operation of restaurant by for-profit entity on State-owned property supports primary recreational purpose of the subject property. Requirement under RFP, operation agreement, and lease agreement for payment of property taxes does not preclude application of local property exemption. Application for local property tax exemption subsequent to NJ DEP/UFT’s RFP procedure and entering into operation agreement is not in violation of public bidding laws or the square corners doctrine. The subject property qualifies for local property tax exemption under N.J.S.A. 54:4-3.3, 2.3, and 1.10.