Category: New Jersey State & Local Tax
New Jersey Increases “Mansion Tax” and Controlling Interest Transfer Tax
On June 30, 2025, New Jersey’s Governor Phil Murphy signed the “Fiscal Year 2026 Appropriations Act” into law, setting forth a budget for New Jersey’s Fiscal Year 2026 totaling a record $58.78 billion. Accompanying the 2026 budget, amendments were made to the existing New Jersey Realty Transfer Fee (RTF) and…
New Jersey GIT Adds IRC § 1202 Exclusion for QSBS Gains
New Jersey has aligned its Gross Income Tax with the federal exclusion of capital gains on Qualified Small Business Stock (QSBS) under Section 1202 of the federal Internal Revenue Code of 1986 (“IRC”). The New Jersey exclusion is effective for tax years beginning January 1, 2026. IRC § 1202 allows…
Responsible Officers and Employees Can Be Held Personally Liable for New Jersey Sales Tax Collection Obligations Even When the Seller Corporation is No Longer “On the Hook”
An Explanation of Responsible Person Liability: The New Jersey Sales Tax is known as a “trust fund tax.” While sales tax is imposed upon the purchaser, it is the seller that has the obligation to collect and remit the tax to the New Jersey Division of Taxation (the Division). This…
NEW JERSEY ELIMINATES SALES TAX EXEMPTION FOR ZERO EMISSION VEHICLES AND ANNUAL SCHOOL SUPPLY TAX HOLIDAY
New Jersey Sales Tax Exemption for Zero Emission Vehicles to be Phased Out. P.L. 2024, c. 19 phases out the New Jersey Sales and Use Tax exemption on sales of zero emission vehicles (ZEVs). The phaseout begins October 1, 2024 by imposing sales tax at the rate of 3.3125%, one-half…
New Jersey Adapts to Federal Centralized Partnership Audit Rules
New Jersey Adapts to Federal Centralized Partnership Audit Rules On December 22, 2022, Governor Murphy signed P.L.2022, c.133 (A4295/S2876) that eliminates the requirement to affirmatively make a New Jersey S corporation election; ends the New Jersey COVID-related extension for State tax assessments and refund interest and adapts New Jersey Partnership…
New Jersey Ends COVID-related Extension for State Tax Assessments
New Jersey Ends COVID-related Extension for State Tax Assessments On December 22, 2022, Governor Murphy signed P.L.2022, c.133 (A4295/S2876) that eliminates the requirement to affirmatively make a New Jersey S corporation election; ends the New Jersey COVID-related extensions for State tax assessments and refund interest and adapts New Jersey Partnership…
New Jersey Piggy-Backs Federal S Corporation Elections
New Jersey Piggy-Backs Federal S Corporation Elections. On December 22, 2022, Governor Murphy signed P.L.2022, c.133 (A4295/S2876) that eliminates the requirement to affirmatively make a New Jersey S corporation election; ends the New Jersey COVID-related extension for State tax assessments and refund interest and adapts New Jersey Partnership Audit Rules…
New Jersey PTE/BAIT – Planning for 2022
New Jersey PTE/BAIT – Planning for 2022. Significant revisions to the elective New Jersey Pass-Through Business Alternative Income Tax (PTE/BAIT) are effective for tax years beginning in 2022. The PTE/BAIT, first effective for tax years beginning in 2020, is a work around for the federal $10,000 state and local…
Tax Update
New Jersey Enacts Bill to Curb the Use of “Refund Anticipation Checks” by Tax Return Preparers Governor Murphy signed into law P.L.2022, c.90 (S891) that prohibits specified tax preparers from engaging in certain practices involving refund anticipation checks and loans. An income tax refund is the largest lump-sum payment that…
New Jersey Deductions for Higher Education Expenses and Savings
Beginning in 2022, the New Jersey College Affordability Act allows New Jersey taxpayers tax deductions for certain educational expenses. The deductions are targeted for taxpayers with gross income of $200,000 or less. Deductions are allowed for contributions to the NJBEST college savings plan, in-state higher education tuition costs and NJCLASS…