How much is New Jersey income tax?
New Jersey income tax at 3 levels of New Jersey taxable income — what is left after New Jersey's own deductions and exemptions. Local income taxes are not included.
| Taxable income | Single | Married filing jointly |
|---|---|---|
| $50,000 | $1,2702.5% effective · 5.525% marginal | $8051.6% effective · 2.45% marginal |
| $100,000 | $4,2444.2% effective · 6.37% marginal | $2,7502.8% effective · 5.525% marginal |
| $250,000 | $13,7995.5% effective · 6.37% marginal | $11,8834.8% effective · 6.37% marginal |
What are New Jersey's income tax brackets for 2026?
| Taxable income | Rate |
|---|---|
| Up to $20,000 | 1.4% |
| Over $20,000 up to $35,000 | 1.75% |
| Over $35,000 up to $40,000 | 3.5% |
| Over $40,000 up to $75,000 | 5.525% |
| Over $75,000 up to $500,000 | 6.37% |
| Over $500,000 up to $1,000,000 | 8.97% |
| Over $1,000,000 | 10.75% |
| Taxable income | Rate |
|---|---|
| Up to $20,000 | 1.4% |
| Over $20,000 up to $50,000 | 1.75% |
| Over $50,000 up to $70,000 | 2.45% |
| Over $70,000 up to $80,000 | 3.5% |
| Over $80,000 up to $150,000 | 5.525% |
| Over $150,000 up to $500,000 | 6.37% |
| Over $500,000 up to $1,000,000 | 8.97% |
| Over $1,000,000 | 10.75% |
Source: NJ Division of Taxation — 2026 Form NJ-1040-ES, Tables A and B; N.J.S.A. 54A:2-1, checked September 12, 2026.
Can you deduct New Jersey income tax on your federal return?
The federal deduction for state and local taxes (SALT) is capped at $40,400 for 2026 — $20,200 if married filing separately — and the cap shrinks toward $10,000 once modified AGI passes $505,000. A single filer with $250,000 of New Jersey taxable income owes about $13,799 in New Jersey income tax — 34% of that cap before any property tax.
SALT cap workaroundsDoes New Jersey have a pass-through entity tax (PTET)?
Yes. A partnership or S corporation can elect to pay New Jersey income tax at the entity level. The business deducts it federally, so that state tax is not limited by the SALT cap, and the owners claim a New Jersey credit or exclusion for it. Deductsy's plan treats March 15 as the New Jersey election or first-payment deadline; it is approximate, so confirm it with New Jersey before relying on it.
PTET savings calculatorWhen are New Jersey estimated tax payments due?
New Jersey estimated tax is due April 15, June 15, September 15 and January 15 of the following year, in 4 equal instalments. Those are the same dates as the federal schedule. Source: 2026 Form NJ-1040-ES instructions.
Safe-harbor calculatorWhat is the penalty for underpaying New Jersey estimated tax?
New Jersey charges interest on an underpaid instalment at the rate it publishes each year: 10% for 2026. Paying at least 80% of this year's tax or 100% of last year's on time avoids it. No estimated payments are required if you expect to owe less than $400. Source: TB-21(R), Interest Rate Assessed on Tax Balances for 2026 (issued December 1, 2025).
Does New Jersey allow the QBI deduction?
No. New Jersey does not allow the federal qualified business income (§199A) deduction, so New Jersey tax is figured on pass-through business income before it.
How the QBI deduction phases outAre HSA contributions deductible in New Jersey?
No. New Jersey does not recognise HSAs — contributions aren't deductible on your NJ return.
Does New Jersey follow federal bonus depreciation?
No. New Jersey does not conform to federal bonus depreciation — the bonus is added back on your NJ return, and NJ then recovers it under its own depreciation rules.
Rental depreciation calculatorCan a rental or business loss offset wages in New Jersey?
No. New Jersey taxes each category of income separately, so a loss in one category can't reduce another. Your rental loss doesn't come off your wages on the NJ-1040 — and New Jersey allows no carryback or carryover of it either.
Does New Jersey give a tax break for 529 plan contributions?
Yes. New Jersey lets you deduct up to $10,000 a year of contributions to New Jersey's own 529 plan, whether you file single or jointly. Income limits, per-beneficiary caps and carryforwards differ by state, so check the plan's rules.
529 plan tax savings calculatorDoes New Jersey take a disability or paid-leave tax out of paychecks?
Yes. New Jersey employees pay NJ TDI + FLI through payroll: 0.56% of wages for 2026, on wages up to $165,400. It comes out on top of federal payroll taxes and New Jersey income tax withholding.
Which states have tax reciprocity with New Jersey?
New Jersey has mutual agreements with Pennsylvania: neither state taxes the other's residents on wages earned there, so those wages are taxed only where you live. Give your employer the exemption certificate and the state you work in stops withholding.
What is the property tax rate in New Jersey?
New Jersey's average effective property tax rate is 2.11% — the highest of 51 jurisdictions and 2.3 times the national average of 0.9%. That is about $2,110 a year for every $100,000 of home value; the rate varies widely by county and school district.
Itemize or take the standard deduction?How much does an LLC cost to keep in New Jersey each year?
Deductsy budgets about $75 a year for a New Jersey LLC — the annual report fee or minimum franchise tax, with a fee due every two years counted at half. Fees change, so confirm with New Jersey's business filing office.
New Jersey S-corp tax calculatorHow do New Jersey taxes compare with neighboring states?
| State | Top income tax rate | Income tax on $100,000 (single) | Property tax (avg) |
|---|---|---|---|
| New Jersey | 10.75% | $4,244 | 2.11% |
| Delaware | 6.6% | $5,584 | 0.5% |
| New York | 10.9% | $5,336 | 1.55% |
| Pennsylvania | 3.07% | $3,070 | 1.3% |
On $100,000 of taxable income a single filer's New Jersey income tax is $4,244 — more than in 1 of 3 neighboring states. The lowest is Pennsylvania at $3,070; the highest is Delaware at $5,584. New Jersey's average property tax rate is higher than in all 3.
Income tax is each state's own tax on the same state taxable income; local income taxes are not included.
More New Jersey tax notes
- New Jersey's pass-through entity tax is the Business Alternative Income Tax (BAIT), and New Jersey was an early adopter.
Tax moves that matter most for New Jersey
If you own an S corporation, partnership or multi-member LLC, New Jersey's PTET election moves the New Jersey income tax on that profit to the business, where it is deductible federally and outside the SALT cap.
That is the highest of 51 and 2.3 times the national average, so property tax does much of the work of filling the SALT cap. Bunching two years of property tax into one can push itemized deductions past the standard deduction in alternate years.
An S-corp election can cut self-employment tax once profit is large enough to pay yourself a reasonable salary and still cover payroll and filing costs. The New Jersey calculator adds New Jersey's own entity fees and taxes to that breakeven.
With 1099 income, a Solo 401(k) can take up to $72,000 a year (2026) — usually more than a SEP-IRA at the same income. Contributions lower both federal and New Jersey income tax.
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