Bill Text: NJ S3141 | 2014-2015 | Regular Session | Introduced
Bill Title: Reduces the gross income tax's top marginal rate to 7.97% from 8.97%.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2015-08-10 - Introduced in the Senate, Referred to Senate Budget and Appropriations Committee [S3141 Detail]
Download: New_Jersey-2014-S3141-Introduced.html
Sponsored by:
Senator JOSEPH PENNACCHIO
District 26 (Essex, Morris and Passaic)
SYNOPSIS
Reduces the gross income tax's top marginal rate to 7.97% from 8.97%.
CURRENT VERSION OF TEXT
As introduced.
An Act reducing the gross income tax's top marginal rate, amending N.J.S.54A:2-1.
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 the January 1 first following the date of enactment of P.L. , c. (pending before the Legislature as this bill) (except as provided in section 1 of P.L.2009, c.69 (C.54A:2-1a) for taxable years beginning on or after January 1, 2009 but before January 1, 2010):
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 the January 1 first following the date of enactment of P.L. , c. (pending before the Legislature as this bill):
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 7.970% of the excess over $500,000.00
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 the January 1 first following the date of enactment of P.L. , c. (pending before the Legislature as this bill) (except as provided in section 1 of P.L.2009, c.69 (C.54A:2-1a) for taxable years beginning on or after January 1, 2009 but before January 1, 2010):
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 the January 1 first following the date of enactment of P.L. , c. (pending before the Legislature as this bill):
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 7.970% of the excess over $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. This act shall take effect immediately and apply to taxable years beginning on or after the January 1 first following the date of enactment.
STATEMENT
This bill reduces the gross income tax's top marginal rate to 7.97% from 8.97%. The purpose of this bill is to moderate the tax burden associated with New Jersey's progressive income tax structure and the highest income tax bracket. The rate reduction is scheduled to apply to taxable years beginning on or after the January 1 first following enactment.
