Senator CHRISTOPHER J. CONNORS
District 9 (Atlantic, Burlington and Ocean)
Provides gross income tax deduction for New Jersey fuel taxes paid through purchases of motor fuel for personal use of motor vehicles.
CURRENT VERSION OF TEXT
An Act providing a deduction under the New Jersey gross income tax for New Jersey taxes paid on purchases of motor fuel for the personal use of taxpayers’ motor vehicles, 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. A taxpayer who files as a married couple filing jointly, a married person filing separately, or an individual filing as a single taxpayer or an individual determining tax pursuant to subsection a. of N.J.S.54A:2-1, may deduct from the taxpayer’s gross income reported pursuant to the “New Jersey Gross Income Tax Act,” N.J.S.54A:1-1 et seq., an amount equal to the New Jersey taxes paid on purchases of motor fuel for the operation for personal use of the taxpayer’s motor vehicles during the taxable year.
b. An amount shall not be deductible under subsection a. of this section if the amount is:
(1) reimbursed to the taxpayer by or for the taxpayer’s employer;
(2) deductible in determining net profits from business pursuant to subsection b. of N.J.S.54A:5-1, even if not so deducted;
(3) deductible in determining net gains or net income derived from or in the form of rents, royalties, patents, and copyrights pursuant to subsection d. of N.J.S.A.54A:5-1, even if not so deducted;
(4) deductible in determining distributive share of partnership income pursuant to subsection k. of N.J.S.54A:5-1, even if not so deducted;
(5) deductible in determining net pro rata share of S corporation income pursuant to subsection p. of N.J.S.54A:5-1, even if not so deducted; or
(6) deductible as a medical expense pursuant to N.J.S.54A:3-3, even if not so deducted, or paid or distributed out of a medical savings account excluded from gross income pursuant to section 5 of P.L.1997, c.414 (C.54A:6-27).
c. The deduction allowed under this section shall not exceed the amount of $1,000 for the taxpayer’s taxable year beginning on or after January 1, 2021 but before January 1, 2022, and shall not exceed the amount of $2,000 for the taxpayer’s taxable years beginning on or after January 1, 2021.
d. For the purposes of this
section “New Jersey taxes paid on purchases of motor fuel” means the taxes
imposed by the “Petroleum Products Gross Receipts Tax Act,” P.L.1990, c.42
(C.54:15B-1 et seq.) and the “Motor Fuel Tax Act,” P.L.2010, c.22 (C.54:39-101
2. This act shall take effect immediately and shall apply to purchases made on and after January 1, 2021.
This bill provides a New Jersey gross income tax deduction for all New Jersey State fuel taxes that are paid by taxpayers on purchases of motor fuel for the operation for personal use of the taxpayer’s motor vehicles and not otherwise reimbursed. Under the bill, the gross income tax deduction is allowed for taxpayers at any income level and in any filing status, and is capped at $1,000 for the 2021 taxable year and at $2,000 for each taxable year beginning thereafter.