This bill amends the existing law regarding the New Jersey Child Tax Credit, specifically updating the income limits and credit amounts for eligible taxpayers. Under the revised law, a resident taxpayer with a New Jersey taxable income of $80,000 or less can receive a credit for each child under six years old, with varying amounts based on income levels. For taxable years 2026, 2027, and 2028, the credit amounts will increase, providing up to $1,250 for those earning $30,000 or less, compared to the previous maximum of $1,000. The bill also clarifies that the income limit applies to all filing statuses and allows taxpayers to claim the credit regardless of whether they use a Social Security number or an Individual Taxpayer Identification Number.

Additionally, the bill stipulates that if the credit exceeds the tax due, the excess will be treated as a refundable overpayment. It requires married taxpayers to file jointly to qualify for the credit, with exceptions for those filing as head of household or surviving spouses. The credit will be pro-rated for part-year residents, and it will not be counted as income for determining eligibility for state benefits. Lastly, the Division of Taxation is tasked with reporting data on the Child Tax Credit claims, including the number of claimants and the average credit amount. The act is set to take effect immediately and will apply to taxable years beginning on or after January 1, 2026.

Statutes affected:
Introduced: 54A:4-17.1
Advance Law: 54A:4-17.1
Pamphlet Law: 54A:4-17.1