Recent Changes to Property Tax Requirements Prohibit Residents from Claiming Thousands of Dollars on their Federal Tax Return
(TRENTON) – Legislation sponsored by Assembly Democrats John McKeon, Mila Jasey and Roy Freiman to counteract the cut in allowable property tax deductions imposed under the new federal tax changes was approved Thursday by the General Assembly.
“Trump’s tax cuts disproportionately affect states with the highest property taxes, like here in New Jersey,” said McKeon (D-Essex/Morris). “Taxpayers who pay more than 21,000 in state and local taxes lose the ability to claim anything over $10,000 in property taxes. That’s a huge loss for New Jersey households. With this bill, municipalities will hopefully help taxpayers lessen the impact property tax deduction limits will have on their federal tax returns.”
The bill (A-3499) would permit a local unit, consisting of a municipality, county or school district, to establish one or more charitable funds, each for a specific public purpose, and permit property tax credits in association with such donations.
“Some New Jersey towns are already looking into this concept,” said Jasey (D-Essex/Morris). “Taxpayers will need relief from President Trump’s near-sighted tax cuts and allowing municipalities to create a charitable fund is a way which makes sense.”
“Homeowners would make contributions to pay for public services, which would be subject to a tax credit to offset that donation,” Freiman (D- Somerset/Mercer/Middlesex/Hunterdon). “A charitable fund option would protect taxpayer investments into their communities and create a way for them to recuperate some of the loss they would experience under the new property tax limits.”
The bill was approved 68-1-3 and now awaits final legislative approval by the Senate.