Hundreds of New Jersey families will receive a $ 500 tax exemption next year under the state budget deal announced Thursday.
The deal breaks a year-long deadlock on millionaire tax and introduces a new rebate program. Some details were difficult to come by Thursday. Legislation outlining the proposal has yet to be introduced, posing some unanswered questions, such as whether non-resident taxpayers are eligible or if exemptions can be made for exempt tax and child support.
“We are among the issues we will be addressing, as we work to finalize the bill,” said Kevin McArdle, spokesman for State Assembly Speaker Craig Coughlin, who thwarted the deal.
The proposal was announced at a press conference by Phil Murphy on Thursday in Trenton, along with State Senate President Stephen Sweeney, D-Gloucester; Coughlin, D-Middlesex; And leader of the state budget committee.
Republicans and business lobbyists immediately put a halt to the proposal, as it was an un-imagined political gimmick that would drive out the state’s high-income people.
Here is what we know so far:
1. Who is eligible for tax exemption?
Married couples in New Jersey with incomes less than $ 150,000 and at least one dependent child qualify for a waiver check. Single parents with incomes under $ 75,000 and at least one dependent child qualify.
2. Eligibility for federal incentive checks was based on adjusted gross income. Will these rebate checks also happen?
Profit is based on gross income, which is your income before taxes and deductions.
3. Are non-residents eligible?
There are no replies yet. It will depend on how the law is written, the administration said.
4. How many houses will pass?
The administration estimated that 800,000 New Jersey homes would qualify for the exemption.
5. How much money will you get?
The maximum discount is $ 500.
Unlike federal incentive payments, there is no sliding scale based on income. However, it is a non-refundable tax exemption, meaning that your state income tax liability must be at least $ 500 to receive the full $ 500 exemption. If your state income tax liability is only $ 300, you will receive a $ 300 exemption. If it is $ 100, you will get a $ 100 discount.
6. What is a dependent child?
Murphy announced that the definition of a dependent child under the state tax code would be changed to change the definition under the federal tax code as a full-time student under the age of 19 or under 24 years of age. Believes in
7. What if you have more than one dependent child?
The discount does not change depending on how many dependent children you have.
8. Will this rebate come in the form of paper check? Or a direct deposit?
It will depend on the legislation, the administration said.
9. When do checks leave?
Eligibility will be based on the taxpayer’s tax return due next April. Money should go out in the summer, Murphy said.
10. Can the rebate be garnished for back taxes or child support?
This, too, a Department of Treasury spokesman said, would depend on the law.
11. Is this a one-time discount?
Murphy said he hopes to make it an annual exemption, but that will depend on future budget negotiations.
12. How much does the rebate program cost?
The rebels will cost about $ 350 million next fiscal year, three sources told NJ Advance Media on Wednesday evening, refusing to speak on record.
13. What is a millionaire tax?
The top marginal tax rate for income in millionaire tax New Jersey has increased from 8.97% to 10.7%. Income over $ 5 million has already been taxed 10.75% under the previous budget deal.
The higher tax rate is more than $ 1 million in first dollars.
Someone making $ 2 million would have to pay $ 18,000 in gross income taxes, while those making $ 4 million would have to pay about $ 71,000.
The last one millionaire tax government ended after the government. John Corzine left office. And the Democrats who pass the tax bill of millions near the Legislature to the government five times. Chris Chris Christie, and he vetoed each time. Sweeney voiced his support for the tax hike after Congress passed a tax overhaul in 2017, saying he gave a tough fight to the state’s billionaires.
14. How many taxpayers will see an increase in income tax?
The Murphy administration said the tax would be paid by 16,491 New Jersey residents and 19,128 non-residents.
It is estimated to generate $ 390 million in the fiscal year beginning October 1.
More than 2,000 taxpayers, with incomes in excess of $ 5 million, are currently paying the top tax rate.
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Samantha Marcus It is possible Happen reached On [email protected].