This bill amends the Property Tax Deduction Act in New Jersey to provide increased income tax relief for tenants by raising the percentage of rent that can be classified as rent constituting property taxes from 18 percent to 30 percent. This change allows tenants to deduct a larger portion of their rent from their gross income, which in turn reduces the amount of income subject to taxation. The current law allows a deduction of up to $15,000 from gross income for property taxes or the rental equivalent for tenants, based on the amount of rent constituting property taxes.

By increasing the percentage of rent that qualifies for this deduction, the bill aims to alleviate the financial burden on tenants, making it more affordable for them to maintain their principal residences. The new definition of "rent constituting property taxes" will now include 30 percent of the rent paid by the taxpayer for occupancy during the taxable year, which is expected to provide significant tax relief for eligible taxpayers. The bill is set to take effect immediately and will apply to taxable years ending after the date of enactment.

Statutes affected:
Introduced: 54A:3A-16