BETTER LATE THAN NEVER - NJ PASSES STATE BUDGET

 

New Jersey recently passed its 2020-2021 budget, several months late due to the pandemic.  Here is the updated word, from the NJ Division of Taxation website, on the property tax relief programs and state income tax.

“2019 Senior Freeze (Property Tax Reimbursement)

The Governor's budget fully funds the 2019 Senior Freeze program. Payments are expected to be paid to eligible taxpayers beginning on October 15, 2020.

2017 Homestead Benefit

2017 Homestead Benefit payments will be paid to eligible taxpayers beginning in May 2021.  {The 2017 Benefit was applied for in 2019 and would normally have been distributed in May of 2020 - rdf.}

2020 Income Tax Rate and Withholding Instruction for Income Between $1 Million and $5 Million

New legislation enacted September 29, 2020, made several changes to the New Jersey Gross Income Tax Act as part of New Jersey's Fiscal Year 2021 budget. The new law increases the Gross Income Tax rate for income between $1 million and $5 million and provides a new withholding rate for the remainder of 2020.

Effective January 1, 2020, the tax rate on that income bracket increases from 8.97% to 10.75%, regardless of filing status. Income over $5 million is already subject to this rate.

Effective immediately, employers must withhold Income Tax at the rate of 21.3% from salaries, wages and other remuneration in excess of $1 million, but not in excess of $5 million, during the taxable year. This higher withholding rate allows taxpayers affected by the rate increase to "catch up" on their withholdings for the year since the new tax rate is retroactive to January 1.

The Division of Taxation will not impose interest or penalties for insufficient payment of estimated tax and/or withholdings that may be due before September 29, 2020, if the underpayment is a result of the new tax rate.”

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FYI, the pdf or print version includes several valuable schedules and worksheets but the e-book version does not.  Email me proof of purchase of the e-book version from Amazon.com and I will send you the forms and schedules as a pdf email attachment free of charge. 

And members of NATP get a 25% discount on the pdf or print version (not the e-book version)!  Just include your NATP membership number with your order.

TTFN