Bill Text: NJ S1821 | 2026-2027 | Regular Session | Amended
Bill Title: Allows gross income tax credits to certain renters whose rent exceeds 35 percent of gross income.
Sponsorship: Partisan Bill (Democrat 6)
Status: (Introduced) 2026-03-05 - Referred to Senate Budget and Appropriations Committee [S1821 Detail]
Download: New_Jersey-2026-S1821-Amended.html
SENATE, No. 1821
STATE OF NEW JERSEY
222nd LEGISLATURE
PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION
Sponsored by:
Senator TROY SINGLETON
District 7 (Burlington)
Senator ANGELA V. MCKNIGHT
District 31 (Hudson)
Co-Sponsored by:
Senators Wimberly, Turner and Stack
SYNOPSIS
Allows gross income tax credits to certain renters whose rent exceeds 35 percent of gross income.
CURRENT VERSION OF TEXT
As reported by the Senate Community and Urban Affairs Committee on March 5, 2026, with amendments.
An Act allowing a gross income tax credit for certain rent payments, supplementing Title 54A of the New Jersey Statutes.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. a. Except as otherwise provided in subsection b. of this section, a 1[resident] qualified1 taxpayer 1[with gross income not in excess of $60,000 in the taxable year, and]1 who pays rent on the principal residence of the taxpayer in excess of 35 percent of the taxpayer's gross income 1[,]1 shall be allowed a credit against the tax otherwise due for the taxable year under the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., in an amount determined in accordance with the following 1[schedule] schedules1:
(1) 1In the case of an unmarried individual other than an individual filing as head of household or as a surviving spouse for federal income tax purposes, the amount shall be determined as follows:
(a)1 100 percent of the excess rent paid by the taxpayer during the taxable year, not to exceed $1,000, if:
1[(a)] (i)1 the taxpayer's gross income for the taxable year does not exceed $50,000, and the taxpayer resides in a high-cost area; or
1[(b)] (ii)1 the taxpayer's gross income for the taxable year does not exceed $25,000, and the taxpayer does not reside in a high-cost area;
1[(2)] (b)1 75 percent of the excess rent paid by the taxpayer during the taxable year, not to exceed $1,000, if:
1[(a)] (i)1 the taxpayer's gross income for the taxable year exceeds $50,000 but does not exceed $60,000, and the taxpayer resides in a high-cost area; or
1[(b)] (ii)1 the taxpayer's gross income for the taxable year exceeds $25,000 but does not exceed $50,000, and the taxpayer does not reside in a high-cost area; or
1[(3)] (c)1 50 percent of the excess rent paid by the taxpayer during the taxable year, not to exceed $1,000, if the taxpayer's gross income for the taxable year exceeds $50,000 but does not exceed $60,000, and the taxpayer does not reside in a high-cost area1[.] ; and
(2) In the case of married individuals filing a joint return, a married individual filing separately, or an individual filing as head of household or as surviving spouse for federal income tax purposes, the amount shall be determined as follows:
(a) 100 percent of the excess rent paid by the taxpayer during the taxable year, not to exceed $1,000, if:
(i) the taxpayer's gross income for the taxable year does not exceed $75,000, and the taxpayer resides in a high-cost area; or
(ii) the taxpayer's gross income for the taxable year does not exceed $37,500, and the taxpayer does not reside in a high-cost area;
(b) 75 percent of the excess rent paid by the taxpayer during the taxable year, not to exceed $1,000, if:
(i) the taxpayer's gross income for the taxable year exceeds $75,000 but does not exceed $90,000, and the taxpayer resides in a high-cost area; or
(ii) the taxpayer's gross income for the taxable year exceeds $37,500 but does not exceed $75,000, and the taxpayer does not reside in a high-cost area; or
(c) 50 percent of the excess rent paid by the taxpayer during the taxable year, not to exceed $1,000, if the taxpayer's gross income for the taxable year exceeds $75,000 but does not exceed $90,000, and the taxpayer does not reside in a high-cost area.1
b. In the case of a taxpayer who receives a State or federal tenant-based housing subsidy, and who otherwise qualifies for a tax credit pursuant to subsection a. of this section, the 1qualified1 taxpayer shall be allowed a credit against the tax imposed under the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., in lieu of the amount authorized pursuant to subsection a. of this section, in an amount equal to 1/12 of the amount of unsubsidized rent paid by the taxpayer during the taxable year.
c. The amount of the credit allowed pursuant to this section shall be applied against the tax otherwise due under the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., after all other credits and payments. If the credit exceeds the amount of tax otherwise due, the amount of excess shall be treated as an overpayment for the purposes of N.J.S.54A:9-7, provided that subsection (f) of N.J.S.54A:9-7 shall not apply, and further provided that a taxpayer may elect to receive the overpayment in monthly installments during the taxable year immediately following the taxable year for which the credit is claimed. d. 1(1) In the case of a married individual filing separately, eligibility for the tax credit allowed pursuant to this section shall be determined based on the combined gross income of the taxpayer, together with the taxpayer's spouse or civil partner, and the total rent paid by both individuals in the taxable year for the principal residence.
(2) In the case of married individuals filing separately, both of whom are qualified taxpayers and reside in the same principal residence, the aggregate value of tax credits allowed pursuant to this section shall not exceed $1,000 for the taxable year. The amount of the allowable tax credit shall be allocated between each qualified taxpayer in proportion to each individual's share of the total rent paid during the taxable year, or in accordance with a written allocation election submitted with the returns filed by both individuals.
e.1 As used in this section:
"Excess rent" means the portion of rent paid by a taxpayer for the taxpayer's principal residence during the taxable year that exceeds 35 percent of the taxpayer's gross income for the taxable year.
"High-cost area" means any location in the State in which the small area fair market rent is used to calculate the tenant-based housing subsidy provided to participants of the federal Housing Choice Voucher Program during the taxable year for which the credit is claimed.
1"Qualified taxpayer" means: for married individuals filing a joint return and individuals filing as head of household or as surviving spouse for federal income tax purposes, a taxpayer with gross income not in excess of $90,000 in the taxable year; for married individuals filing separately, a taxpayer with combined gross income, together with the taxpayer's spouse or civil partner, not in excess of $90,000 in the taxable year; and for unmarried individuals other than individuals filing as head of household or as a surviving spouse for federal income tax purposes, a taxpayer with gross income not in excess of $60,000 in the taxable year.1
2. If a taxpayer qualified for the credit allowed pursuant to section 1 of P.L. , c. (C. ) (pending before the Legislature as this bill) in the taxable year immediately preceding the date of enactment of P.L. , c. (C. ) (pending before the Legislature as this bill), the taxpayer shall file an amended tax return with the director within 90 days following the date of enactment of P.L. , c. (C. ) (pending before the Legislature as this bill) to claim the credit or refund of any resulting overpayment of tax.
3. This act shall take effect immediately and shall apply retroactively to taxable years beginning on or after the taxable year immediately preceding the date of enactment.
