Sponsored by:
Assemblyman BRIAN BERGEN
District 25 (Morris and Somerset)
Assemblyman HAROLD "HAL" J. WIRTHS
District 24 (Morris, Sussex and Warren)
Assemblyman JOHN CATALANO
District 10 (Ocean)
Co-Sponsored by:
Assemblyman Peters and Assemblywoman Stanfield
SYNOPSIS
Allows certain taxpayers to receive higher NJ earned income tax credit amount for tax year 2020 if amount of credit falls below credit earned in tax year 2019.
CURRENT VERSION OF TEXT
As introduced.
An Act preventing a lower Taxable Year 2020 New Jersey earned income tax credit amount for certain taxpayers.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. a. For Taxable Year 2020, the amount of credit allowed pursuant to section 2 of P.L.2000, c.80 (C.54A:4-7) for a taxpayer shall be the greater of the amount otherwise allowed under the New Jersey earned income tax credit for the taxpayer for Taxable Year 2019 or Taxable Year 2020.
b. This section shall only apply to taxpayers with an identical tax filing status for both Taxable Year 2019 and Taxable Year 2020.
2. This act shall take effect immediately and only apply to credits allowed for Taxable Year 2020.
STATEMENT
This bill allows a taxpayer who qualifies for and claims the New Jersey earned income tax credit in both TY 2019 and TY 2020 to receive the higher amount calculated for those years as their credit amount for TY 2020.
Due to the COVID-19 pandemic, some residents have earned less income, which will impact their New Jersey earned income tax credit amounts. The intent of this bill is to protect those residents from receiving a TY 2020 New Jersey earned income credit that is less than their TY 2019 credit. For example, if a taxpayer’s credit was calculated out to be $500 in TY 2019, but falls to $250 in TY 2020, that taxpayer would receive a $500 credit for TY 2020 instead.
The bill only applies to those taxpayers with an identical filing status for both TY 2019 and TY 2020. Thus, if a taxpayer files as single in TY 2019 and married in TY 2020, that taxpayer would not qualify for the higher credit under this bill.