This bill amends N.J.S.54A:9-8 to extend the time period for taxpayers to file amended gross income tax returns specifically for correcting overpayments related to military pension payments or military survivors benefit payments. Under the new provisions, taxpayers will have 10 years from the time the return was filed or 10 years from the time the tax was paid, whichever is later, to claim a credit or refund for any overpayment. This is a significant change from the current law, which requires claims to be filed within three years from the return filing or two years from the tax payment, thereby allowing more time for taxpayers to rectify any errors in reporting these specific income types.

The bill also clarifies that the amount of credit or refund for the overpayment shall not exceed what would be allowable if the claim had been filed on the date the credit or refund is granted. This change is particularly relevant for taxpayers who may have mistakenly reported military pension or survivor benefits as taxable income, as these payments are generally exempt from New Jersey gross income tax. By extending the filing period, the bill aims to provide relief to those who may have inadvertently overpaid their taxes due to such reporting errors.