jest.config.js

module.exports = {
  // The root of your source code, typically /src
  // `<rootDir>` is a token Jest substitutes
  // roots: ["<rootDir>/src"],

  // Jest transformations -- this adds support for TypeScript
  // using ts-jest
  transform: {
    "^.+\\.tsx?$": "ts-jest"
  },

  // Runs special logic, such as cleaning up components
  // when using React Testing Library and adds special
  // extended assertions to Jest
  setupFilesAfterEnv: [
    // "@testing-library/react/cleanup-after-each",
    "@testing-library/jest-dom/extend-expect"
  ],

  // Test spec file resolution pattern
  // Matches parent folder `__tests__` and filename
  // should contain `test` or `spec`.
  testRegex: "(/__tests__/.*|(\\.|/)(test|spec))\\.tsx?$",

  // Module file extensions for importing
  moduleFileExtensions: ["ts", "tsx", "js", "jsx", "json", "node"],
  globals: {
    // we must specify a custom tsconfig for tests because we need the typescript transform
    // to transform jsx into js rather than leaving it jsx such as the next build requires. you
    // can see this setting in tsconfig.jest.json -> "jsx": "react"
    "ts-jest": {
      "tsConfig": "tsconfig.jest.json"
    }
  }
};