jest.config.js

// jest.config.js
const nextJest = require('next/jest')

const createJestConfig = nextJest({
  // Provide the path to your Next.js app to load next.config.js and .env files in your test environment
  dir: './',
})

// Add any custom config to be passed to Jest
/** @type {import('jest').Config} */
const customJestConfig = {
  // Add more setup options before each test is run
  setupFilesAfterEnv: ['<rootDir>/jest.setup.js'],
  // if using TypeScript with a baseUrl set to the root directory then you need the below for alias' to work
  moduleDirectories: ['node_modules', '<rootDir>/'],

  // If you're using [Module Path Aliases](https://nextjs.org/docs/advanced-features/module-path-aliases),
  // you will have to add the moduleNameMapper in order for jest to resolve your absolute paths.
  // The paths have to be matching with the paths option within the compilerOptions in the tsconfig.json
  // For example:

  moduleNameMapper: {
    '@/(.*)$': '<rootDir>/src/$1',
  },
  collectCoverage: true,
  coveragePathIgnorePatterns: ["index.ts"],
  testEnvironment: 'jest-environment-jsdom',
}

// createJestConfig is exported this way to ensure that next/jest can load the Next.js config which is async
module.exports = createJestConfig(customJestConfig)