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New Jersey has become one of the most recent states to adopt market-based sourcing. Beginning with tax years ending on or after July 31, 2019, taxpayers subject to New Jersey’s Corporation Business Tax (CBT) will be required to source the sales of services to New Jersey if the benefit of the services is received in New Jersey. Historically, the sourcing of services was based on the cost of performance; if the service was performed in New Jersey, the sale would be sourced to New Jersey. Following suit of about twenty-five states that have previously adopted market-based sourcing, New Jersey will start collecting revenue from out-of-state service companies with customers located in New Jersey, and in turn, reduce the CBT liabilities of in-state service companies with customers located in neighboring states. Unlike other states that have adopted market-based sourcing for the sales of services and intangibles, it is important to note that New Jersey’s sourcing rules for the sales of intangibles, such as goodwill, intellectual property, or other assets that are not physical in nature, remains unchanged, with the cost of performance rule still in effect.