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Division of Taxation

Important Income Tax Changes for Tax Year 2007

  • Earned Income Tax Credit
    Beginning with tax year 2007, eligibility for the New Jersey Earned Income Tax Credit (NJEITC) has been expanded so that taxpayers who are eligible and file for a Federal earned income credit can also receive a New Jersey credit in the amount equal to 20% of their Federal benefit. Previously, eligible applicants had to have New Jersey gross income of $20,000 or less and at least one qualifying child

  • Civil Unions
    The Civil Union Act (P.L. 2006, c.103) established civil unions in New Jersey for couples of the same sex. Effective for tax years beginning on or after January 1, 2007, partners to a civil union recognized under New Jersey law must file their New Jersey income tax returns and property tax relief program applications using the same filing statuses accorded spouses under New Jersey Gross Income Tax law.

  • Pension Exclusion Line Moved
    Eligible taxpayers will now claim the New Jersey Pension Exclusion on Line 27a after calculating their total taxable income (before exclusions) on Line 26. This change will make it easier for filers to determine whether or not they meet the income requirement for the Pension and Other Retirement Income Exclusions (total income for the entire year of $100,000 or less).

  • Credit for Taxes Paid to Other Jurisdictions
    — Jurisdiction Code Required on Line 39. Resident taxpayers who claim a credit for taxes paid to other jurisdictions are now required to enter a two-digit code for the jurisdiction at Line 39, Form NJ 1040. A list of jurisdiction codes appears in the NJ-1040 instruction booklet.

    — Philadelphia Wage Tax Rate. The Philadelphia nonresident wage tax rate for 2007 is 3.7557%.

  • Homestead Rebate Program
    — Tenants who meet the eligibility requirements use the application in the income tax booklet, Form TR-1040, to apply for the homestead rebate for tenants.

    — Homeowners do not use the application in the income tax booklet. Applications for the homeowner rebate are expected to be mailed at the end of April, and homeowners will apply either online or by phone.

    Note: Benefits available under this program are subject to change.

  • Property Tax Reimbursement
    The Property Tax Reimbursement (PTR) Program reimburses eligible senior citizens or disabled persons for property tax increases. Eligible residents must file a 2007 Property Tax Reimbursement Application (Form PTR-1 or PTR-2) by the extended due date of October 31, 2008. The original due date was June 2, 2008.

    Income Limits. For residents applying for reimbursements for tax year 2007, total annual income must be less than:

    For 2007: $45,135 if single, or $55,344 (combined income) if married or in a civil union, and

    For 2006: $43,693 if single, or $53,576 (combined income) if married or in a civil union.

    Note: Benefits available under this program are subject to change.

  • Gross Income Tax Rates
    There has been no change in the New Jersey gross income tax rates for tax year 2007. Go to “Tax Rates” to view the New Jersey tax tables, tax rates schedules, or NJ-WT, Instruction Booklet for Employers, Payors of Pension and Annuity Income and Payors of Gambling Winnings.

Last Updated: Tuesday, 11/17/20