This bill establishes a refundable gross income tax credit for taxpayers in New Jersey who make early principal payments on their home mortgages. Specifically, taxpayers can receive a credit equal to 50 percent of the excess principal payments made during the taxable year on their principal residence, with a maximum credit of $1,000 per year. The bill defines key terms such as "acquisition indebtedness," "excess home mortgage principal payments," and "qualified home mortgage indebtedness," ensuring that only certain types of mortgages qualify for the credit. Additionally, the credit is subject to income phase-outs for higher earners, with reductions for single taxpayers earning between $125,000 and $135,000 and married couples earning between $250,000 and $270,000.

The legislation aims to encourage middle-class families to pay down their mortgages more quickly, thereby building equity and wealth. It is modeled after the federal Building Equity for the American Middle-Class Act (BEAM Act) and allows taxpayers to claim the credit for up to ten taxable years. Notably, married individuals must file jointly to qualify for the credit, and the bill includes provisions for the Director of the Division of Taxation to adopt necessary regulations for implementation. The act is set to take effect immediately and will apply to taxable years beginning on or after January 1 following its enactment.