With the latest tax season upon us it is worth reviewing some of the key tax changes for New Jersey residents and tax filers. As a relatively high taxing state with higher than average incomes it is no surprise that taxes are a hot button topic in New Jersey.
The New Jersey Division of Taxation (NJT) manages the administration and collection of taxes and related programs for individuals and corporations in the state. Generally, you have to file a state tax return if you’re an income earning resident or part-year resident or a non-resident who earned income over a prescribed income threshold in the state.
You can use the same industry standard tax software to file federal and state tax returns (e.g. TurboTax or eFile). The state also offers free filing options via their NJ Online Filing Service if you meet certain income requirements.
The focus in this article is around state specific taxes and changes for the latest tax season. For federal tax changes that will impact the latest tax season, see this article.
Important Tax Season Considerations
State taxes are due in line with federal tax filing deadlines, unless a state holiday or exception is noted. For the current tax season, the filing deadline is April 18, 2022. You can request a 6-month extension, but still need to pay any actual or estimated tax liability.
Based on the latest NJT press release, here are the key changes to be aware of when filing your return this year:
Middle Class Tax Rebate: The $500 rebate was automatically calculated and mailed to residents filing a 2020 Income Tax return with $75,000 (single)/$150,000 (married) or less of income and claiming at least one dependent child with a tax balance of $1 or more. If you have not received your rebate, make sure filed a 2020 return. This should not hold up your tax filing this year.
Retirement Income Exclusions: The income limit for a Retirement Income Exclusion increases to $150,000
Child and Dependent Care Credit: The taxable income amount increased to $150,000 or less to qualify for this credit. The credit will reduce the amount of Gross Income Tax a taxpayer owes, and may result in a refund if no taxes are owed.
Unemployment Compensation: Many NJ residents participated and received benefits via the federal pandemic unemployment programs. These federal benefits should be accounted for in your federal tax return (1040) and are not subject to New Jersey tax and should not be included when you file a New Jersey return.
Military Personnel & Veterans: For Tax Year 2021 and after, combat pay is not taxable in New Jersey and does not need to be included when reporting your gross income on a New Jersey Income Tax return (Form NJ-1040)
Property Tax Relief for Senior Citizens: The Senior Freeze Program reimburses eligible senior citizens or disabled persons for property tax increases. Eligible residents must file a 2021 Senior Freeze application (Form PTR-1 or PTR-2).
NJ Earned Income Tax Credit (NJEITC)
The NJEITC was extended to include people 18 years old and over, as well as those over age 65 without dependents. The NJEITC amount is 40% of the federal Earned Income Tax Credit (EITC) for 2021.
Checking the Status of Your Refund
As was the case with federal tax return processing, NJ residents have also faced long delays in getting their state refunds over the past few years. Pandemic related staffing shortages and the introduction of many federal and state tax breaks placed extra burdens on local agencies which in turn delayed validation and processing of many state tax returns.
However you can easily check the status of your state tax refund via the states Check Your Refund status tool, much like the federal/IRS Where is my Refund (WMR) tool. Keep in mind the following processing timelines when checking your refund and before you should call an agent around any refund or payment delays:
- 4 weeks or more after you file electronically
- At least 12 weeks after you mail your return
- 15 weeks or more for additional processing requirements or paper returns sent by certified mail
You can also call call 1-800-323-4400 (toll-free within NJ, NY, PA, DE, and MD) or 609-826-4400 (anywhere) for NJT automated refund system.
If your refund is lower than expected it could be due to the many Set-off or offset programs that the NJT has in place to divert a taxpayer’s refunds and government payments to pay federal or state debts such as unpaid taxes, traffic fines, or child support.
Key NJ State TAx deductions
Medical expenses deduction: You can only deduct medical expenses paid during the year for yourself, your spouse or domestic partner, and your dependents that exceed 2% of your (AGI) income.
Alimony: You can deduct any court-ordered alimony payments on your tax return, but you can’t deduct child support payments.
Obtaining Copies of Previously Filed Tax Returns (Tax Transcripts)
To get a copy or transcript of your tax return, complete Form DCC-1 and send it to:
New Jersey Division of Taxation
Document Control Center
PO Box 269
Trenton, NJ 08695-0269
You also can get a copy of your NJ-1040, NJ-1040NR or NJ-1041 at a Division of Taxation Regional Information Center. To pick up a copy/transcript of your return you must provide a photo ID (driver’s license or other government issued photo ID).
1 thought on “Where is My New Jersey (NJ) State Tax Refund? 2023 Refund Status, Payment Delays and Getting a Live Agent”
I am getting an error message when attempting to file a NJ-1040. It says that “returns with pass through business alternative income tax credits are not eligible for electronic filing”