New Jersey State Income Tax Overview

New Jersey is one of the many states that has a state income tax, which is overseen by the State of New Jersey’s Department of the Treasury.  New Jersey state income tax is in addition to the federal income tax imposed by the Internal Revenue Service (IRS).  Following is an overview of frequently asked questions related to New Jersey state income tax.

Who has to file a state income tax return for New Jersey?

The New Jersey Department of the Treasury outlines state income tax filing requirements that are applicable to full-year residents, partial-year residents, and non-residents.

Full-Year Residents

If you are a resident of New Jersey for the entire year or part of the year, you must file a state income tax return if your income from all sources for the entire year exceeds the filing threshold of $10,000 if you are filing as a single or married filing separately and $20,000 if you are married filing jointly.

Partial-Year Residents

In the case of partial-year residents, you must file a state income tax return if your income from all sources for the entire year exceeds the filing threshold noted above.  You should only report the income you earned while a resident of New Jersey, also prorating credits, exclusions, exemptions, and deductions based on the portion of the tax year in which you lived in New Jersey.

Non-Residents

If you were a non-resident of New Jersey for the entire year, you must file a state income tax return if your income from all sources for the entire year exceeds the filing threshold noted above.

What amounts are available to reduce the tax owed on a New Jersey state income tax return?

New Jersey offers the following exemptions, deductions, and credits for those filing a state income tax return.

Exemptions

  • Taxpayer – $1,000
  • Taxpayer’s spouse who is not filing separately – $1,000
  • Taxpayer who is 65 years old or older – $1,000 (in addition to normal $1,000)
  • Taxpayer’s spouse who is 65 years old or older who is not filing separately – $1,000 (in addition to the normal $1,000)
  • Taxpayer who is blind or disabled – $1,000 (in addition to above normal and age 65 amounts of $1,000 each)
  • Taxpayer’s spouse who is blind or disabled – $1,000 (in addition to above normal and age 65 amounts of $1,000 each)
  • Taxpayer’s dependent – $1,500
  • Taxpayer’s dependent under age 22 and attending college full time – $1,000

Deductions

  • Payments of alimony or for separate maintenance, so long as the payee reports those payments as income
  • Unreimbursed medical expenses above 2% of gross income, qualified medical savings account contributions, and qualified health insurance costs
  • Amounts paid for property tax
  • Qualified conservation contributions

Credits

  • Payments of income tax imposed by another state or by the District of Columbia
  • Amounts withheld by an employer and payments of estimated tax
  • Amounts paid by an S corporation on behalf of a shareholder
  • Amounts paid by a partnership on behalf of a partner
  • New Jersey Earned Income Tax Credit
  • Excess unemployment and disability insurance contributions withheld
  • Property tax credit
  • Sheltered Workshop Tax Credit

What is the tax rate charged on New Jersey state income tax?

The tax rate beginning with the tax year starting January 1, 2004, ranges from 1.4% to 8.97% based on the following amounts:

Filing Single or Married Filing Separately

Amount of Income Tax Rate
$0 to $20,000 1.4%
Over $20,000 to $35,000 1.75% less $70.00
Over $35,000 to $40,000 3.5% less $682.50
Over $40,000 to $75,000 5.525% less $1,492.50
Over $75,000 to $500,000 6.37% less $2,126.50
Over $500,000 $8.97% less $15,126.25

Married Filing Jointly

Amount of Income Tax Rate
$0 to $20,000 1.4%
Over $20,000 to $50,000 1.75% less $70.00
Over $50,000 to $70,000 2.45% less $420.00
Over $70,000 to $80,000 3.5% less $1,154.50
Over $80,000 to $150,000 5.525% less $2,775.00
Over $150,000 to $500,000 6.37% less $4,042.50
Over $500,000 8.97% less $17,042.50

What is the filing date for New Jersey state income tax?

New Jersey state income tax is generally due on the same date set by the IRS for federal income tax returns.  Likewise, a six-month extension for filing your state income tax return is available; however, even if you apply for an extension to file your state income tax return, you must still pay an estimate of any tax due by the original filing date.

What if I need help preparing my New Jersey state income tax return?

The information above should not be considered legal advice.  If you need help in answering questions about your taxes or in preparing your state income tax return, you need to speak with a tax attorney who understands New Jersey state income tax law and how it will apply to your individual situation.

by Mark Johnston

Mark has been a contributor to legal web sites related to bankruptcy, tax, and criminal law since 2011. He has an Accounting degree from Texas A&M University.