Bill Text: NJ A3619 | 2010-2011 | Regular Session | Introduced
Bill Title: Modifies New Jersey gross income tax rates.
Spectrum: Partisan Bill (Democrat 3-0)
Status: (Failed) 2010-12-13 - Withdrawn from Consideration [A3619 Detail]
Download: New_Jersey-2010-A3619-Introduced.html
Sponsored by:
Assemblyman PATRICK J. DIEGNAN, JR.
District 18 (Middlesex)
Assemblyman JOHN S. WISNIEWSKI
District 19 (Middlesex)
Assemblyman PETER J. BARNES, III
District 18 (Middlesex)
SYNOPSIS
Modifies New Jersey gross income tax rates.
CURRENT VERSION OF TEXT
As introduced.
An Act modifying New Jersey gross income tax rates, amending N.J.S.54A:2-1, N.J.S.54A:2-4 and N.J.S.54A:8-3.1.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. N.J.S.54A:2-1 is amended to read as follows:
54A:2-1. Imposition of tax. There is hereby imposed a tax for each taxable year (which shall be the same as the taxable year for federal income tax purposes) on the New Jersey gross income as herein defined of every individual, estate or trust (other than a charitable trust or a trust forming part of a pension or profit-sharing plan), subject to the deductions, limitations and modifications hereinafter provided, determined in accordance with the following tables with respect to taxpayers' taxable income:
a. For married individuals filing a joint return and individuals filing as head of household or as surviving spouse for federal income tax purposes:
(1) for taxable years beginning on or after January 1, 1991 but before January 1, 1994:
If the taxable income is: The tax is:
Not over $20,000.00.......... 2% of taxable income
Over $20,000.00 but not
over $50,000.00............. $400.00 plus 2.5% of the
excess over $20,000.00
Over $50,000.00 but not
over $70,000.00.............. $1,150.00 plus 3.5% of the
excess over $50,000.00
Over $70,000.00 but not
over $80,000.00.............. $1,850.00 plus 5.0% of the
excess over $70,000.00
Over $80,000.00 but not
over $150,000.00............. $2,350.00 plus 6.5% of the
excess over $80,000.00
Over $150,000.00............... $6,900.00 plus 7.0% of the
excess over $150,000.00
(2) for taxable years beginning on or after January 1, 1994 but before January 1, 1995:
If the taxable income is: The tax is:
Not over $20,000.00.............. 1.900% of taxable income
Over $20,000.00 but not
over $50,000.00................ $380.00 plus 2.375% of the
excess over $20,000.00
Over $50,000.00 but not
over $70,000.00.............. $1,092.50 plus 3.325% of the
excess over $50,000.00
Over $70,000.00 but not
over $80,000.00.............. $1,757.50 plus 4.750% of the
excess over $70,000.00
Over $80,000.00 but not
over $150,000.00............. $2,232.50 plus 6.175% of the
excess over $80,000.00
Over $150,000.00 ............. $6,555.00 plus 6.650% of the
excess over $150,000.00
(3) for taxable years beginning on or after January 1, 1995 but before January 1, 1996:
If the taxable income is: The tax is:
Not over $20,000.00............. 1.700% of taxable income
Over $20,000.00 but not
over $50,000.00................ $340.00 plus 2.125% of the
excess over $20,000.00
Over $50,000.00 but not
over $70,000.00.............. $977.50 plus 2.975% of the
excess over $50,000.00
Over $70,000.00 but not
over $80,000.00.............. $1,572.50 plus 4.250% of the
excess over $70,000.00
Over $80,000.00 but not
over $150,000.00............. $1,997.50 plus 6.013% of the
excess over $80,000.00
Over $150,000.00 ............. $6,206.60 plus 6.580% of the
excess over $150,000.00
(4) for taxable years beginning on or after January 1, 1996 but before January 1, 2004:
If the taxable income is: The tax is:
Not over $20,000.00............ 1.400% of taxable income
Over $20,000.00 but not
over $50,000.00................ $280.00 plus 1.750% of the
excess over $20,000.00
Over $50,000.00 but not
over $70,000.00.............. $805.00 plus 2.450% of the
excess over $50,000.00
Over $70,000.00 but not
over $80,000.00.............. $1,295.50 plus 3.500% of the
excess over $70,000.00
Over $80,000.00 but not
over $150,000.00............. $1,645.00 plus 5.525% of the
excess over $80,000.00
Over $150,000.00 ............. $5,512.50 plus 6.370% of the
excess over $150,000.00
(5) for taxable years beginning on or after January 1, 2004 but before January 1, 2011:
If the taxable income is: The tax is:
Not over $20,000.00 ........... 1.400% of taxable income
Over $20,000.00 but not
over $50,000.00 ................ $280.00 plus 1.750% of the
excess over $20,000.00
Over $50,000.00 but not
over $70,000.00 ............. $805.00 plus 2.450% of the
excess over $50,000.00
Over $70,000.00 but not
over $80,000.00 ............. $1,295.50 plus 3.500% of the
excess over $70,000.00
Over $80,000.00 but not
over $150,000.00 ............ $1,645.00 plus 5.525% of the
excess over $80,000.00
Over $150,000.00 but not
over $500,000.00 ............ $5,512.50 plus 6.370% of the
excess over $150,000.00
Over $500,000.00 ............ $27,807.50 plus 8.970% of the
excess over $500,000.00
(6) for taxable years beginning on or after January 1, 2011:
If the taxable income is: The tax is:
Not over $50,000.00 ........... 0.00% of taxable income
Over $50,000.00 but not
over $75,000.00 ................ 5.525% of the
excess over $50,000.00
Over $75,000.00 but not
over $500,000.00 ............. $1,381.25 plus 6.375% of the
excess over $75,000.00
Over $500,000.00 but not
over $1,000,000.00 ............. $28,475.00 plus 9.00% of the
excess over $500,000.00
Over $1,000,000.00 but not
over $2,000,000.00 ............ $73,475.00 plus 9.50% of the
excess over $1,000,000.00
Over $2,000,000.00 but not
over $3,000,000.00 ............ $168,475.00 plus 9.75% of the
excess over $2,000,000.00
Over $3,000,000.00 ............ $265,975.00 plus 10.00% of the
excess over $3,000,000.00
b. For married individuals filing separately, unmarried individuals other than individuals filing as head of household or as a surviving spouse for federal income tax purposes, and estates and trusts:
(1) for taxable years beginning on or after January 1, 1991 but before January 1, 1994:
If the taxable income is: The tax is:
Not over $20,000.00............ 2% of taxable income
Over $20,000.00 but not
over $35,000.00................ $400.00 plus 2.5% of the
excess over $20,000.00
Over $35,000.00 but not
over $40,000.00................ $775.00 plus 5.0% of the
excess over $35,000.00
Over $40,000.00 but not
over $75,000.00.............. $1,025.00 plus 6.5% of the
excess over $40,000.00
Over $75,000.00................ $3,300.00 plus 7.0% of the
excess over $75,000.00
(2) for taxable years beginning on or after January 1, 1994 but before January 1, 1995:
If the taxable income is: The tax is:
Not over $20,000.00...... 1.900% of taxable income
Over $20,000.00 but not
over $35,000.00......... $380.00 plus 2.375% of the
excess over $20,000.00
Over $35,000.00 but not
over $40,000.00................ $736.25 plus 4.750% of the
excess over $35,000.00
Over $40,000.00 but not
over $75,000.00.............. $973.75 plus 6.175% of the
excess over $40,000.00
Over $75,000.00............... $3,135.00 plus 6.650% of the
excess over $75,000.00
(3) for taxable years beginning on or after January 1, 1995 but before January 1, 1996:
If the taxable income is: The tax is:
Not over $20,000.00......... 1.700% of taxable income
Over $20,000.00 but not
over $35,000.00................ $340.00 plus 2.125% of the
excess over $20,000.00
Over $35,000.00 but not
over $40,000.00................ $658.75 plus 4.250% of the
excess over $35,000.00
Over $40,000.00 but not
over $75,000.00.............. $871.25 plus 6.013% of the
excess over $40,000.00
Over $75,000.00............... $2,975.80 plus 6.580% of the
excess over $75,000.00
(4) for taxable years beginning on or after January 1, 1996 but before January 1, 2004:
If the taxable income is: The tax is:
Not over $20,000.00............ 1.400% of taxable income
Over $20,000.00 but not
over $35,000.00................ $280.00 plus 1.750% of the
excess over $20,000.00
Over $35,000.00 but not
over $40,000.00................ $542.50 plus 3.500% of the
excess over $35,000.00
Over $40,000.00 but not
over $75,000.00.............. $717.50 plus 5.525% of the
excess over $40,000.00
Over $75,000.00............... $2,651.25 plus 6.370% of the
excess over $75,000.00
(5) for taxable years beginning on or after January 1, 2004 but before January 1, 2011:
If the taxable income is: The tax is:
Not over $20,000.00 ............ 1.400% of taxable income
Over $20,000.00 but not
over $35,000.00 ............... $280.00 plus 1.750% of the
excess over $20,000.00
Over $35,000.00 but not
over $40,000.00 ............... $542.50 plus 3.500% of the
excess over $35,000.00
Over $40,000.00 but not
over $75,000.00 ............. $717.50 plus 5.525% of the
excess over $40,000.00
Over $75,000.00 but not
over $500,000.00 ............. $2,651.25 plus 6.370% of the
excess over $75,000.00
Over $500,000.00 ............... $29,723.75 plus 8.970% of the
excess over $500,000.00
(6) for taxable years beginning on or after January 1, 2011:
If the taxable income is: The tax is:
Not over $25,000.00 ........... 0.00% of taxable income
Over $25,000.00 but not
over $37,500.00 ................ 5.525% of the
excess over $25,000.00
Over $37,500.00 but not
over $250,000.00 ............. $690.63 plus 6.375% of the
excess over $37,5000.00
Over $250,000.00 but not
over $500,000.00 ............. $14,237.51 plus 9.00% of the
excess over $250,000.00
Over $500,000.00 but not
over $1,000,000.00 ............ $36,737.51 plus 9.50% of the
excess over $500,000.00
Over $1,000,000.00 but not
over $1,500,000.00 ............ $84,237.51 plus 9.75% of the
excess over $1,000,000.00
Over $1,500,000.00 ............ $132,987.51 plus 10.00% of the
excess over $1,500,000.00
c. For the purposes of this section, an individual who would be eligible to file as a head of household for federal income tax purposes but for the fact that such taxpayer is a nonresident alien, shall determine tax pursuant to subsection a. of this section.
(cf: P.L.2004, c.40, s.17)
2. N.J.S.54A:2-4 is amended to read as follows:
54A:2-4. Minimum taxable income. Notwithstanding any other provisions of this act, a taxpayer shall not be subject to tax under this act if:
a. The taxpayer is filing as an unmarried individual, an estate or trust, with a gross income of
(1) $3,000 or less for taxable years beginning before January 1, 1994,
(2) $7,500 or less for taxable years beginning on or after January 1, 1994 but before January 1, 1999, [and]
(3) $10,000 or less for taxable years beginning on or after January 1, 1999 but before January 1, 2011; and
(4) $25,000 or less for taxable years beginning on or after January 1, 2011;
b. The taxpayer is determining tax pursuant to subsection a. of N.J.S.54A:2-1, or is a married couple filing a joint return, with a gross income of
(1) $3,000 or less for taxable years beginning before January 1, 1994,
(2) $7,500 or less for taxable years beginning on or after January 1, 1994 but before January 1, 1999,
(3) $10,000 or less for taxable years beginning on or after January 1, 1999 but before January 1, 2000,
(4) $15,000 or less for taxable years beginning on or after January 1, 2000 but before January 1, 2001, [and]
(5) $20,000 or less for taxable years beginning on or after January 1, 2001 but before January 1, 2011; and
(6) $50,000 or less for taxable years beginning on or after January 1, 2011; or
c. The taxpayer is a married person filing separately with a gross income of
(1) $1,500 or less for taxable years beginning before January 1, 1994,
(2) $3,750 or less for taxable years beginning on or after January 1, 1994 but before January 1, 1999,
(3) $5,000 or less for taxable years beginning on or after January 1, 1999 but before January 1, 2000,
(4) $7,500 or less for taxable years beginning on or after January 1, 2000 but before January 1, 2001, [and]
(5) $10,000 or less for taxable years beginning on or after January 1, 2001 but before January 1, 2011; and
(6) $25,000 or less for taxable years beginning on or after January 1, 2011.
In the case of a nonresident, gross income shall mean gross income which such nonresident would have reported if he had been a resident.
(cf: P.L.1999, c.260, s.1)
3. N.J.S.54A:8-3.1 is amended to read as follows:
54A:8-3.1. Persons required to file. a. On or before the filing date prescribed in section 1 of this chapter (N.J.S.54A:8-1), an income tax return shall be made and filed by or for:
(1) A taxpayer filing as an unmarried individual, an estate or trust, with a gross income
(a) in excess of $3,000 for taxable years beginning before January 1, 1994,
(b) in excess of $7,500 for taxable years beginning on or after January 1, 1994 but before January 1, 1999, [and]
(c) in excess of $10,000 for taxable years beginning on or after January 1, 1999 but before January 1, 2011; and
(d) in excess of $25,000 for taxable years beginning on or after January 1, 2011;
(2) A taxpayer determining tax pursuant to subsection a. of N.J.S.54A:2-1 having gross income, or a married couple filing a joint return having joint gross income
(a) in excess of $3,000 for taxable years beginning before January 1, 1994,
(b) in excess of $7,500 for taxable years beginning on or after January 1, 1994 but before January 1, 1999,
(c) in excess of $10,000 for taxable years beginning on or after January 1, 1999 but before January 1, 2000,
(d) in excess of $15,000 for taxable years beginning on or after January 1, 2000 but before January 1, 2001, [and]
(e) in excess of $20,000 for taxable years beginning on or after January 1, 2001[;] , and
(f) in excess of $50,000 for taxable years beginning on or after January 1, 2011; or
(3) A taxpayer who is a married person filing separately with gross income of
(a) in excess of $1,500 for taxable years beginning before January 1, 1994,
(b) in excess of $3,750 for taxable years beginning on or after January 1, 1994 but before January 1, 1999,
(c) in excess of $5,000 for taxable years beginning on or after January 1, 1999 but before January 1, 2000,
(d) in excess of $7,500 for taxable years beginning on or after January 1, 2000 but before January 1, 2001, [and]
(e) in excess of $10,000 for taxable years beginning on or after January 1, 2001, and
(f) in excess of $25,000 for taxable years beginning on or after January 1, 2011.
b. If the income tax liability of husband and wife is determined on a separate return for federal income tax purposes, they shall each also file a separate return for New Jersey income tax purposes and their income tax liabilities under this act shall be separate.
c. If the income tax liabilities of husband and wife, both residents, are determined on a joint return for federal income tax purposes, they shall also file a joint return for New Jersey income tax purposes and their tax liabilities under this act shall be joint and several.
d. If either husband or wife is a resident and the other is a nonresident, they shall file separate tax returns under this act on such single or separate forms as may be required by the director in which event their tax liabilities shall be separate unless both elect to determine their joint taxable income as if both were residents, in which event their liabilities shall be joint and several.
e. The return for any deceased individual shall be made and filed by his fiduciary or other person charged with his property.
f. The return for an individual who is unable to make a return by reason of minority or other disability shall be made and filed by his fiduciary or other person charged with the care of his person or property (other than a receiver in possession of only a part of his property), or by his duly authorized agent.
g. Any tax under this act, and any increase, interest or penalty thereon, shall, from the time it is due and payable, be a personal debt of the person liable to pay the same, to the State of New Jersey.
h. If both husband and wife are nonresidents but only one spouse earns, receives or acquires income from sources within this State, they shall file separate forms as may be required by the director and their tax liabilities shall be separate, unless both elect to determine their joint taxable income in accord with N.J.S.54A:5-7 and their liabilities under this act shall be joint and several.
(cf: P.L.1999, c.260, s.2)
4. This act shall take effect immediately and shall apply to taxable years beginning on or after January 1, 2011.
STATEMENT
This bill modifies the New Jersey gross income tax rate structure beginning with the 2011 taxable year. It eliminates gross income tax and final return filing responsibility for joint taxpayers, and individuals filing as head of household or as a surviving spouse for federal income tax purposes, with taxable income up to $50,000 and for married individuals filing separately, single taxpayers, and estates and trusts with taxable income up to $25,000.
For taxpayers filing jointly and individuals filing as head of household or as a surviving spouse for federal income tax purposes:
if taxable income is not over $50,000, no tax will be imposed. Income between $50,000 and $75,000, is taxed at 5.525% ; income between $75,000 and $500,000 is taxed at 6.375%; income between $500,000 and $1,000,000 is taxed at 9.00%; income between $1,000,000 and $2,000,000 is taxed at 9.50%; income between $2,000,000 and $3,000,000 is taxed at 9.75% and income over $3,000,000 is taxed at 10.00%.
For married individuals filing separately, unmarried individuals other than individuals filing as head of household or as a surviving spouse for federal income tax purposes, and estates and trusts:
if taxable income is not over $25,000, no tax will be imposed. Income between $25,000 and $37,500 is taxed at 5.525%; income between $37,500 and $250,000 is taxed at 6.375%; income between $250,000 and $500,000 is taxed at 9%; income between $500,000 and $1,000,000 is taxed at 9.50%, income between $1,000,000 and $1,500,000 is taxed at 9.75%; and income over $1,500,000 is taxed at 10%.
