Pensions, IRA, and 401K Distributions
The CARES Act amended IRC section 72 which includes the early withdrawal penalty and when to report distributions.
New Jersey does not follow IRC section 72 and did not adopt the CARES Act amendment. New Jersey has its own methods for reporting distributions. Taxpayers must follow New Jersey's rules when reporting pension income. See GIT-1&2 Retirement Income for additional information on how to properly report this income.
COVID-19 Fiscal Mitigation Act Extends Due Dates, Payment of Interest, and Tax Assessments
On April 14, 2020 Governor Murphy signed into law the "COVID-19 Fiscal Mitigation Act" (P.L. 2020, c.19) that automatically extends the due date to July 15, 2020, for certain tax filings and payments originally due on April 15, 2020. In addition, the Act impacts the payment of interest on refunds for all taxes and the timeframe for the Division to make assessments of all taxes.
Extension of Time to File and Pay
Individual Gross Income Tax and Calendar Year Partnership filers now have until July 15 to file and pay these taxes, including estimated tax payments due on April 15. Penalties and interest will not be imposed on the balance of tax due between the original due date and the extended due date for returns and/or payments submitted by July 15, 2020.
On October 15, 2020, Governor Murphy signed Executive Order 189 extending the due date for 2019 calendar year Corporation Business Tax returns until un November 16, 2020.
Extension of Time to File a Claim for a Refund or Credit
The statutory deadlines for filing a claim for a refund or credit under the Sales and Use Tax Act, the Gross Income Tax Act, and the State Uniform Procedure Law, have been extended until 90 days after the last day of the COVID-19 Public Health Emergency. The extension is available if the statutory deadline for filing a claim for a refund or credit is on or after March 9, 2020, and within 90 days of the end of the Public Health Emergency.
Payment of Interest on Refunds
The Division pays interest on refunds that are issued six months after the date the refund claim was filed, the tax was paid, or the due date of the return, whichever is later ("the original interest payment period"). This provision applies to all taxes administered by the Division. The new law extends the original interest payment period by an additional six months after the COVID-19 state of emergency has been lifted ("the extended interest period"). If the original interest payment period ended prior to April 14, 2020 (the effective date of the new law), the payment of interest on the refund will not be affected by the new law. If the original interest payment period ends on or after April 14, 2020, interest will be paid if the refund is issued after the original interest period or the extended interest period, whichever is later.
Assessment of Tax
There is a statutorily prescribed time limit for the Division to audit and/or make assessments on tax returns ("the original assessment time period"). For most taxes, the original assessment time period is within 4 years of the date that a tax return was filed. The original assessment time period is shorter for Gross Income Tax returns, which must be assessed within 3 years of the date that a tax return was filed. A taxpayer may consent to an additional period of time beyond the 3 or 4 year period ("the consent period"). The new law extends both the original assessment time period and the consent period by an additional 90 days after the COVID-19 state of emergency has been lifted ("the extended assessment time period")
Therefore, if either the original assessment time period or the consent period ends on or after April 14, 2020, the Division can make an assessment on or before the expiration of the extended assessment time period under the new law. If the original assessment time period or the consent period ends before April 14, 2020, the Division would be out of time to make an assessment for the returns(s) that are beyond the 3 or 4 year time period.
As part of the Division’s response to the COVID-19 pandemic, we will accept scanned images of signatures and digital signatures on documents related to the determination or collection of tax, including but not limited to: extensions of the statute of limitations (consent forms); closing agreements; and the appointment of a Taxpayer Representative (M-5008-R).
The Division will accept scanned or photographed images of signatures or digital signatures that are encrypted as proof of original and unmodified documentation. The following file types are acceptable: tiff, jpg, jpeg, pdf, Microsoft Office Suite, or Zip.
The exception to this policy is any form that requires an original paper form with signature to be mailed, such as: the Business Assistance Application for Tax Clearance, the Notification of Sale, Transfer, or Assignment in Bulk form (C-9600), and Inheritance Tax returns and forms.
Extended Property Tax Payment
All other returns and payments are due on their original due date (including 2nd quarter estimated tax payments for calendar year filers).
Additional information by topic is located below. To view the information click on the appropriate topic title. We will continue to update this page as additional tax guidance develops.
To help taxpayers facing financial challenges resulting from the COVID-19 pandemic, the New Jersey Division of Taxation is providing taxpayers with increased flexibility, additional time to meet tax obligations, and relief from a number of compliance actions. The goal is to help New Jersey taxpayers and citizens during this unprecedented health crisis.
Governor Murphy signed legislation to extend tax due dates in order to give taxpayers more time to meet their tax obligations during this difficult time. To complement these actions, from April 15, 2020 to July 15, 2020, the Division will adjust many of its tax compliance programs and processes to help individuals and businesses.
During the COVID-19 pandemic, we have made our payment plan guidelines more flexible. Taxpayers under an existing payment plan may be eligible to modify or extend their plan upon request. Taxpayers must contact the payment plan unit to modify their plan. Please email all requests to modify your plan to firstname.lastname@example.org.
If you are not on a payment plan and are unable to pay your taxes, you are urged to request a payment plan to help stay current with your tax filing responsibilities.
Interest will continue to accrue on any unpaid tax balances.
The Division will work with taxpayers to complete its review of work through correspondence (mail or electronic) where possible and avoid in-person meetings until further notice. To facilitate the progress of audits, taxpayers are encouraged to respond to any requests for information if they are able to do so. Where field work at a taxpayer's site will be necessary, the Division will work with taxpayers to schedule that work to resume after this period. Keep in mind that depending on developments, it may be determined that resuming field work is in the best interest of both parties due to availability of people and records New legislation effective April 14, 2020 extends the time frame for the Division to make an assessment.
Taxpayers can find forms and answers to many common Inheritance and Estate Tax questions on the Division's Inheritance and Estate Tax homepage.
The branch is operating with reduced staff and you may experience significant wait times or delays in response to telephone inquiries, emails or general correspondence. For questions regarding an Inheritance or Estate Tax matter, including protest and appeal matters, taxpayers may contact the Inheritance and Estate Tax Service Center at 609-292-5033, Monday through Friday, 8:30 a.m. to 4:30 p.m
All in-person hearings are suspended until further notice. However, limited staff is available and may conduct telephone conferences where appropriate. If you have submitted all documentation that was requested and would like to proceed with a telephone conference, please email the conferee assigned to your matter or call the main number at 609-322-6056 and leave a message, including a telephone number, email address, and the Taxpayer ID#. You will receive a response as to whether a telephone conference can be scheduled.
Taxpayers should continue to file protests and requests for a hearing through either regular mail or by email to email@example.com.
On March 19, 2020, the Chief Justice of the NJ Supreme Court extended the 90-day timeframe to file a protest. If the 90-day time frame to file a protest expires after March 19, taxpayers have until May 1, 2020, or 30 days after the COVID-19 State of Emergency has ended, whichever is later, to file the protest.
The Division will continue to work current cases, but will limit in-person contact. New investigations & collection activity continue where deemed necessary to protect the State's interest and we will pursue taxpayers that willfully avoid meeting their New Jersey tax obligations and take steps where warranted.
Specialized collection units are operating with reduced staff, but are available to provide assistance or answer questions.
Field Investigation's Branch Regional Offices
The Field Branch has established Regional Office phone lines available for businesses to call and discuss proactive ways to comply with New Jersey tax laws during this pandemic crisis. Businesses are encouraged to contact our local offices for help to avoid falling into common tax pitfalls. Investigators will work with businesses to help them avoid common filing errors, navigate the Division's website to locate specific guidance, set up payment plans, answer questions about electronic filing and payments, and discuss ongoing or pending cases. Callers may experience busy signals or delays in responding to telephone inquiries, emails, or general correspondence. We remain committed to continuing to provide the best service we can, we apologize for any inconvenience this may cause you and thank you for your patience. Because of limited staffing, you may be asked to leave a voice mail message and a representative will return your call.
Tax Clearances and License Renewals
License renewals, tax clearances, and compliance checks will continue and we encourage the use of payment plans in order to get your needed renewal or license.
Use of private collection agencies
Taxation's private collection vendor, Pioneer Credit Recovery (PCR) will continue to operate under modified conditions. PCR will consider abatements and extensions of time for COVID-19 related issues and will respond to taxpayer inquiries for accounts referred by the Division of Taxation.
Business Non-filer Notices
The Division will continue to send non-filer delinquency notices for business taxes. Businesses are encouraged to file and remit returns and payments using our online business tax system. Please review the schedule of return and payment due dates for additional information.
Once returns have been filed, taxpayers who have a financial hardship can take that opportunity to resolve any outstanding liabilities by entering into a payment plan using the Division's flexible terms.
Trust Fund Taxes
All collected trust fund monies must be reported and remitted in full in accordance with your filing frequency. There has been no extension of filing or payment dates related to trust fund taxes.
Tax Credit and Incentive Programs
Tax clearances statutorily required will continue to be administered timely to ensure that the State can fulfill contractual obligations to award benefits to those participating in economic development programs.
The Division of Taxation is aware of the urgent need of our State's taxpayers to have increased time and flexibility. This plan affirms our agency's commitment to providing assistance in addressing their tax obligations. This is viewed as a first step in working with taxpayers and practitioners to help maintain and promote tax compliance. Over the next three months, the Division will continue to evaluate if it needs to extend the program and if additional actions can be taken to enable taxpayers to comply with New Jersey tax laws. Where businesses and individuals have not been able to report and pay timely, we plan to fully explore how we can restore their routine voluntary compliance.
The Trenton Regional Information Center is open to the public by appointment only. Go to our Regional Information Center page to request an appointment.
Visitors to the Trenton office must wear a face covering and adhere to social distancing guidelines. If you plan on visiting our office, remember:
Taxpayers are encouraged to file and pay online or correspond with us by mail.
Our Call Center is operating with reduced staff on a limited schedule Monday through Friday, 8:30 a.m. until 4:30 p.m., except State holidays. You may experience significant wait times or delays in response to telephone inquiries, email services, or general correspondence.
We apologize for any inconvenience this may cause you. We remain committed to continuing to provide the best service we can and we thank you for your patience.
The federal Paycheck Protection Program (PPP) was established by the federal CARES Act (Coronavirus Aid, Relief, and Economic Security Act) in 2020 in response to the economic impact of COVID-19 to help small businesses keep employees on their payroll during the pandemic.
Under the federal PPP program, some or all of the loan may be forgiven if certain conditions are met. While federal law generally considers forgiven loans to be taxable income, the "Consolidated Appropriations Act, 2021," which reauthorized the program, clarified that the amount of a PPP loan that is forgiven may be excluded from income for federal tax purposes. It also states that expenses covered by PPP loans may be deducted from income for federal tax purposes.
New Jersey will follow the federal government's treatment in that related expenses paid for with PPP loans will be deductible for both Gross Income Tax (GIT) and Corporation Business Tax (CBT) purposes and forgiven loans will be excluded from being subject to either tax.
As our Federal and State governments continue to react to the COVID-19 pandemic in real-time with a primary focus on limiting travel, large gatherings and the movement of our citizens, many businesses are executing contingency plans which require their employees to work remotely where possible. The reassignment of work locations and/or the displacement of workers due to health safety precautions raises many employer and employee concerns. Access our Telecommuter COVID-19 Employer and Employee FAQ for guidance.
NJEDA grants and tax credits are not subject to tax under the New Jersey Gross Income Tax Act and the Corporation Business Tax Act. The same is also true for county issued COVID-19 related grants.
Do not report NJEDA or county COVID-19 related grant or credit income on a New Jersey Gross Income Tax or Corporation Business Tax return.
2017 Homestead Benefit
2017 Homestead Benefit payments will be paid to eligible taxpayers beginning in May 2021.