INDIVIDUAL NEW JERSEY INCOME TAXES
PROPERTY TAX RELIEF
Homestead Benefit Program:
In prior years this program was known as the Homestead Rebate. The program has changed in that instead of receiving a check in the fall, eligible homeowners will receive their homestead benefit for 2009 as a credit on the property tax bill for the second quarter of 2011.
If you were age 65 or older and/or disabled on December 31, 2009, you are eligible for a 2009 homestead benefit if your domicile is in New Jersey and you meet the following conditions:
- Owned and occupied a home in NJ that was your principal residence on October 1. 2009.
- Have NJ gross income for 2009 of $150,000 or less before exemptions and deductions.
- The home must have been subject to local property taxes and 2009 property taxes must be paid.
If you were under age 65 and NOT disabled on December 31, 2009, you are eligible for a 2009 homestead benefit if your domicile is in New Jersey and you meet the following conditions:
- Owned and occupied a home in NJ that was your principal residence on October 1, 2009.
- Have NJ gross income for 2009 of $75,000 or less before exemptions and deductions.
- The home must have been subject to local property taxes and 2009 property taxes must be paid.
The amount of the benefit is based on the applicant’s income, filing status, property taxes, and whether the applicant was age 65 or older or eligible to claim an exemption as blind or disabled for tax year 2009. The State Budget mandates that the 2009 benefit will be calculated using 2006 property taxes. Tenants will not receive a 2009 homestead rebate.
Property Tax Reimbursement Program (Senior Freeze):
The current State Budget contains modifications to the Property Tax Reimbursement Program. Only those applicants who received a reimbursement for tax year 2008, and whose income for 2009 does not exceed the 2008 income limit of $70,000 are eligible to receive a reimbursement for 2009. Reimbursements for eligible applicants for tax year 2009 cannot exceed the 2008 reimbursement amount approved for payment.
To be eligible for a reimbursement of the difference between the amount of property taxes you paid for the base year (the year you first became eligible) and the amount paid for the current year you are applying for you must meet all the following requirements for both years:
- You are age 65 or older or receiving Federal Social Security disability benefits; and
- You have lived in New Jersey continuously for a least the last 10 years, as a homeowner or a renter; and
- You have owned and lived in your home for at least the last 3 years; and
- You have paid the full amount of property taxes due on your home; and
- You meet the income limits for each year. The income limit for 2008 and 2009 is $70,000 or less.
NJ Income Tax – Property Tax Deduction/Credit:
Homeowners and tenants who pay property taxes, either directly or through rent, on their principal residence in New Jersey may qualify for either a deduction or a refundable credit on their New Jersey resident income tax return. Qualified residents may be able to deduct up to 100% of their property taxes due and paid or up to $10,000, whichever is less. For tenants, 18% of rent paid during the year is considered property taxes paid.
Homeowners under age 65 years of age and not blind or disabled whose gross income is over $250,000 are not eligible for the property tax deduction. If their income is between $150,000 and $250,000, the maximum deduction is limited to $5,000.