N.J. Stat. tit. 54A, ch. 3

in effect

N.J. Stat. § 54A:3-1 Personal exemptions and deductions.

54A:3-1. Personal exemptions and deductions. Each taxpayer shall be allowed personal exemptions and deductions against his gross income as follows: (a) Taxpayer. Each taxpayer shall be allowed a personal exemption of $1,000.00 which may be taken as a deduction from his New Jersey gross income. (b) Additional exemptions. In addition to the personal exemptions allowed in (a), the following additional personal exemptions shall be allowed as a deduction from gross income: 1. For the taxpayer's spouse, or domestic partner as defined in section 3 of P.L.2003, c.246 (C.26:8A-3), who does not file separately - $1,000.00. 2. For each dependent who qualifies as a dependent of the taxpayer during the taxable year for federal income tax purposes - $1,500.00. 3. Taxpayer 65 years of age or over at the close of the taxable year - $1,000.00. 4. Taxpayer's spouse 65 years of age or over at the close of the taxable year - $1,000.00. 5. Blind or disabled taxpayer - $1,000.00. 6. Blind or disabled spouse - $1,000.00. 7. Taxpayer who is a veteran honorably discharged or released under honorable circumstances from active duty in the Armed Forces of the United States, a reserve component thereof, or the National Guard of New Jersey in a federal active duty status, as those terms are used in N.J.S.38A:1-1 - $6,000. (c) Special Rule. The personal exemptions allowed under this section shall be limited to that percentage which the total number of months within a taxpayer's taxable year under this act bears to 12. For this purpose 15 days or more shall constitute a month. (d) (Deleted by amendment, P.L.1993, c.178). (e) Nonresidents. For taxable years to which a certification pursuant to section 3 of P.L.1993, c.320 (C.54A:2-1.2) applies, a nonresident taxpayer shall be allowed the same deduction for personal exemptions as a resident taxpayer. However, if (1) the nonresident taxpayer's gross income which is subject to tax under this act is exceeded by (2) the gross income which the nonresident taxpayer would be required to report under this act if the taxpayer were a resident by more than $100.00, the taxpayer's deduction for personal exemptions shall be limited by the percentage which (1) is to (2). amended 1990, c.61, s.13; 1993, c.178, s.1; 1993, c.320, s.1; 2003, c.246, s.40; 2016, c.57, s.8; 2019, c.146.

N.J. Stat. § 54A:3-1.1 Dependent under 22 in attendance at accredited post-secondary institution

In addition to the exemptions allowed under N.J.S. 54A:3-1, each taxpayer shall be allowed an additional exemption which may be taken as a deduction from his New Jersey gross income in amount of $1,000.00 for each dependent under the age of 22 years who is attending an accredited post-secondary institution of higher education on a full time basis and for whom the taxpayer paid one-half or more of the costs of tuition and maintenance of the dependent's attendance at such institution. L.1976, c. 84, s. 1, eff. Sept. 2, 1976.

N.J. Stat. § 54A:3-2 Alimony and separate maintenance payments

There shall be allowed as a deduction amounts includible under section 54A:5-1(n) with respect to payments included as income in the return of a former spouse or of a spouse receiving separate maintenance pursuant to a court decree (or which would have otherwise been includible if such payments were made to an individual subject to tax under this act). L.1976, c. 47, s. 54A:3-2, eff. July 8, 1976, operative Aug. 30, 1976.

N.J. Stat. § 54A:3-3 Medical expenses.

54A:3-3. Medical expenses. (a) Each taxpayer shall be allowed to deduct from the taxpayer's gross income medical expenses for the taxpayer, the taxpayer's spouse, and the taxpayer's dependents with respect to such expenses that were paid during the taxable year and to the extent that such medical expenses exceed 2% of the taxpayer's gross income. In the case of a nonresident, gross income shall mean gross income which such nonresident would have reported if the taxpayer had been subject to tax during the entire taxable year as a resident. (b) Special Rule for Decedents. (1) Treatment of expenses paid after death. Expenses for the medical care of the taxpayer which are paid out of the taxpayer's estate during the one-year period beginning with the day after the day of the death shall be treated as paid by the taxpayer at the time incurred. (2) Limitation. Paragraph (1) shall not apply if the amount paid is not allowable as a deduction in computing medical expense deductions for federal income tax purposes. (c) Disallowance of amounts allowed for other purposes. (1) Any expenses allowed as a deduction of expenses for household and dependent care services necessary for gainful employment shall not be allowed as an expense paid for medical care for purposes of this section. (2) Any amounts paid or distributed out of a medical savings account that are excluded from gross income pursuant to section 5 of P.L.1997, c.414 (C.54A:6-27) shall not be allowed as an expense paid for medical care for purposes of this section. (3) Any amounts allowed as a deduction for the health insurance costs of the self-employed pursuant to section 1 of P.L.1999, c.222 (C.54A:3-5) shall not be allowed as an expense paid for medical care for purposes of this section. L.1976, c.47, s. 54A:3-3; amended 1997, c.414, s.2; 1999, c.222, s.2.

N.J. Stat. § 54A:3-4 Deductions for contributions to medical savings account.

3. a. A taxpayer may deduct from the taxpayer's gross income an amount equal to the contributions to a medical savings account that the taxpayer is allowed for the taxable year as a deduction for federal income tax purposes pursuant to section 220 of the federal Internal Revenue Code of 1986, 26 U.S.C. s.220. b. The deduction provided by subsection a. of this section shall, notwithstanding any amendment or supplement to federal law, be allowed only to "eligible individuals" qualifying under the limitations of subsection (i), and subject to the numerical limits of subsection (j), of section 220 of the federal Internal Revenue Code of 1986, 26 U.S.C. s.220, as in effect on January 1, 1997. L.1997,c.414,s.3.

N.J. Stat. § 54A:3-5 Self-employed individuals, deduction for health insurance costs.

1. A taxpayer who is a "self-employed individual" within the meaning of clause (B) of paragraph (1) of subsection (c) of section 401 of the federal Internal Revenue Code of 1986, 26 U.S.C.s.401, and a taxpayer treated as such a "self-employed individual" under that section pursuant to section 1372 of the federal Internal Revenue Code of 1986, 26 U.S.C.s.1372, shall be allowed to deduct from the taxpayer's gross income an amount equal to the amount paid during the taxable year for insurance which constitutes medical care for the taxpayer, the taxpayer's spouse, and dependents; provided however, that the amount of such deduction shall not exceed the taxpayer's "earned income," as defined pursuant to subsection (c) of section 401 of the federal Internal Revenue Code of 1986, 26 U.S.C.s.401, derived by the taxpayer from the trade or business with respect to which the plan providing the medical care coverage is established, and provided further that no deduction shall be allowed for coverage of any month for which the taxpayer is eligible to participate in any subsidized health plan maintained by any employer of the taxpayer or of the spouse of the taxpayer. L.1999,c.222,s.1.

N.J. Stat. § 54A:3-6 Deduction for qualified conservation contribution

1. A taxpayer shall be allowed a deduction against gross income for a qualified conservation contribution, as defined under subsection (h) of section 170 of the federal Internal Revenue Code of 1986, 26 U.S.C. s.170, made by the taxpayer of a qualified real property interest in property located in this State. The amount of the deduction in a taxable year shall be equal to the amount of the contribution allowed in the taxable year as a deduction pursuant to section 170 of the federal Internal Revenue Code of 1986 in computing the taxpayer's taxable income for federal income tax purposes. L.1999,c.372.

N.J. Stat. § 54A:3-7 Designation of "Health Enterprise Zones."

1. Each area that is designated by the Commissioner of Health and Senior Services as a State designated underserved area pursuant to N.J.S.18A:71C-35 shall be deemed to be a "Health Enterprise Zone" for the purposes of P.L.2004, c.139 (C.54A:3-7 et al.). L.2004,c.139,s.1.

N.J. Stat. § 54A:3-8 Tax deduction for qualified receipts, definitions.

2. a. A taxpayer who is providing primary care as defined in N.J.S.18A:71C-32 at: (1) a practice that is located in a Health Enterprise Zone as described in section 1 of P.L.2004, c.139 (C.54A:3-7); or (2) a qualified practice that is located within 5 miles of a Health Enterprise Zone as described in section 1 of P.L.2004, c.139 (C.54A:3-7); shall be allowed to deduct from the taxpayer's gross income in a taxable year an amount equal to that proportion of the taxpayer's net income deriving from that practice for the taxable year that the qualified receipts of that practice for the taxable year bear to the total amount received for services at that practice for the taxable year. b. For the purposes of this section: "Qualified practice" means a practice at which 50% or more of the total amount received for services at that practice for the taxable year are qualified receipts and 50% or more of the patients whose services are compensated by qualified receipts reside in a Health Enterprise Zone; and "Qualified receipts" means amounts received for services from the Medicaid program pursuant to P.L.1968, c.413 (C.30:4D-1 et seq.), including amounts received from managed care organizations under contract with the Medicaid program, the FamilyCare Health Coverage Program pursuant to P.L.2000, c.71 (C.30:4J-1 et seq.), and the Children's Health Care Coverage Program pursuant to P.L.1997, c.272 (C.30:4I-1 et seq.) for providing health care services to eligible program recipients. L.2004,c.139,s.2.

N.J. Stat. § 54A:3-9 Alternative business calculation established.

1. a. Notwithstanding the provisions of N.J.S.54A:5-1, for the purposes of the alternative business calculation pursuant to this section a taxpayer who sustains a net loss in one or more of the net categories of gross income determined pursuant to subsections b., d., k., and p. of N.J.S.54A:5-1 shall net that loss against any other gains or losses sustained in those categories of gross income and any loss carryforward allowed pursuant to subsection b. of this section to determine alternative business income or loss. b. Notwithstanding the provisions of N.J.S.54A:5-2, a taxpayer who sustains an alternative business loss pursuant to the provisions of subsection a. of this section may carry that loss forward, if necessary and in accordance with the terms and conditions prescribed by the director, for application pursuant to the provisions of subsection a. of this section during each of the 20 taxable years following the alternative business loss' taxable year. c. (1) A taxpayer shall calculate regular business income as the total of the subsection b., d., k., and p. categories of gross income determined pursuant to N.J.S.54A:5-1 in accordance with N.J.S.54A:5-2. (2) A taxpayer shall subtract alternative business income from regular business income determined pursuant to paragraph (1) of this subsection to determine the business increment. (3) For purposes of calculating a taxpayer's liability pursuant to the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., a taxpayer shall adjust the taxpayer's taxable income pursuant to the following schedule: For taxable years beginning in 2012, the taxpayer shall subtract from taxable income 10% of the business increment; For taxable years beginning in 2013, the taxpayer shall subtract from taxable income 20% of the business increment; For taxable years beginning in 2014, the taxpayer shall subtract from taxable income 30% of the business increment; For taxable years beginning in 2015, the taxpayer shall subtract from taxable income 40% of the business increment. For taxable years beginning in 2016 and thereafter, the taxpayer shall subtract from taxable income 50% of the business increment. L.2011, c.60, s.1.

N.J. Stat. § 54A:3-10 Deduction from gross income for organ, bone marrow donor.

4. a. A taxpayer shall be allowed to deduct from gross income up to $10,000 of unreimbursed expenses specified in subsection b. of this section if the taxpayer or the taxpayer's dependent donates one or more of their human organs, or a part thereof, or bone marrow to another human for human organ transplantation. b. The deduction allowed pursuant to this section may be claimed only for reasonable unreimbursed travel expenses, lodging expenses, and lost wages that are related to the donation and are incurred by the taxpayer in the taxable year. c. The deduction allowed pursuant to this section shall be claimed in the taxable year in which the human organ transplantation occurs, except that any expenses specified in subsection b. of this section that are incurred in the previous or subsequent taxable year shall be claimed in the taxable year in which the expenses are incurred, but the combined amount deducted shall not exceed $10,000. L.2019, c.444, s.4.

N.J. Stat. § 54A:3-11 Short title.

1. Sections 2 through 5 of P.L.2021, c.128 (C.18A:71B-42.1 et al.) shall be known and may be cited as the "New Jersey College Affordability Act." L.2021, c.128, s.1.

N.J. Stat. § 54A:3-12 Allowable deduction in the amount of taxpayer's contribution.

3. A taxpayer with gross income of $200,000 or less shall be allowed a deduction, not to exceed $10,000, from the taxpayer's gross income for the taxable year in the amount of the taxpayer's contribution for the taxable year to an account established pursuant to the "New Jersey Better Educational Savings Trust Program," (N.J.S.18A:71B-35 et seq.). L.2021, c.128, s.3.

N.J. Stat. § 54A:3-13 Allowable deduction in the amount of student loan principal, interest payments.

4. A taxpayer with gross income of $200,000 or less shall be allowed a deduction, not to exceed $2,500, from the taxpayer's gross income for the taxable year in the amount of principal and interest payments paid on a student loan under the New Jersey College Loans to Assist State Students Loan Program established pursuant to N.J.S.18A:71C-21. L.2021, c.128, s.4.

N.J. Stat. § 54A:3-14 Allowable deduction in the amount of higher education tuition costs.

5. a. A taxpayer with gross income of $200,000 or less shall be allowed a deduction, not to exceed $10,000, from the taxpayer's gross income for the taxable year in the amount the taxpayer paid to an in-State institution of higher education during the taxable year for tuition costs related to the taxpayer's enrollment or attendance at the institution of higher education or related to the enrollment or attendance of a spouse or dependent of the taxpayer at the institution. b. As used in this section, "tuition costs" means the charges imposed by an in-State institution of higher education that are designated by the institution as the tuition costs required for the enrollment or attendance of the taxpayer or a spouse or dependent of the taxpayer at the institution. L.2021, c.128, s.5.

Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://www.njleg.state.nj.us/legislative-activity/statutesFetched: 10/17/2026