Senator NELLIE POU
District 35 (Bergen and Passaic)
Senator TROY SINGLETON
District 7 (Burlington)
Allows gross income tax deductions for contributions to the NJBEST program.
CURRENT VERSION OF TEXT
An Act allowing gross income tax deductions for contributions to the NJBEST program and 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 taxpayer shall be allowed a deduction, not to exceed $5,000, $2,500 for a married person filing separately, 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 (NJBEST) Program," (N.J.S.18A:71B-35 et seq.).
2. This act shall take effect immediately and shall apply to contributions made for taxable years beginning after enactment.
This bill allows a taxpayer to deduct the amount of the taxpayer’s contribution to an account created under the New Jersey Better Educational Savings Trust (NJBEST) Program, New Jersey’s federally qualified tuition program, from the taxpayer’s gross income for the taxable year in which the contribution is made. The maximum deduction per taxpayer allowed under the bill for a taxable year is $5,000 ($2,500 for a married taxpayer filing separately). The deduction provided by the bill will serve as an incentive for participation in the NJBEST Program and will help taxpayers meet the ever-increasing costs of higher education.
A number of states currently offer special state tax benefits for the state’s own federally qualified tuition program. Of the states that offer special benefits, some offer a full tax deduction for contributions and others place a limit on the amount of the deduction.