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Information on
Novel Coronavirus

Have questions about COVID-19?
The NJ Poison Control Center and 211 have partnered with the State to provide information to the public on COVID-19:
Call: 2-1-1 for general information (24/7) or 1-800-962-1253 for medical information (24/7); Text: NJCOVID to 898-211
Visit covid19.nj.gov or nj.gov/health for additional information

Division of Taxation

COVID-19 Related Tax Information
Information about the Federal Economic Impact Payment – Stimulus Check
Important Information About Retail COVID-19 Fees and Sales Tax

NJ Income Tax – Income Exclusions

There are several retirement income exclusions you may qualify to use that will reduce your taxable income.

Pension Exclusion

The exclusion amounts are being increased over a four-year period, beginning with Tax Year 2017, as shown below:

Retirement Income Exclusions

You qualify for the pension exclusion if:

  • You (and/or your spouse/civil union partner, if filing jointly) were 62 or older or disabled as defined by Social Security guidelines on the last day of the tax year (December 31 for calendar year filers); and
  • Your total income for the entire year was $100,000 or less.

If you qualify, you can claim the lesser of your actual taxable pension income or the maximum pension exclusion amount for your filing status (see chart above).

Note: When you and your spouse/civil union partner file a joint return and only one of you is 62 or older or disabled, you can still claim the maximum pension exclusion. However, you can exclude only the pension, annuity, or IRA withdrawal of the qualified spouse/civil union partner.

Other Retirement Income Exclusion

You may be able to exclude other types of income (wages, interest, dividends, etc.) from your total income. There are two parts to these exclusions, and each part has different eligibility requirements.

Part I: Unclaimed Pension Exclusion. If you did not use the maximum pension exclusion amount for your filing status, you qualify to use the unclaimed portion if:

  • You (and/or your spouse/civil union partner, if filing jointly) were 62 or older on the last day of the tax year; and
  • Your total income for the entire year was $100,000 or less; and
  • Your income from wages, net profits from business, distributive share of partnership income, and net pro rata share of S corporation income totals $3,000 or less.

Note: When you and your spouse/civil union partner file a joint return and only one of you is 62 or older, you can exclude only the income of the qualified spouse/civil union partner.

Part II: Special Exclusion. This exclusion is for taxpayers who cannot receive Social Security or Railroad Retirement benefits. Since most taxpayers qualify for those benefits, few taxpayers are eligible to use the special exclusion. If you qualify, you can claim this benefit even if you used your maximum pension exclusion. You qualify if:

  • You (and/or your spouse/civil union partner, if filing jointly) were 62 or older on the last day of the tax year; and
  • You (and your spouse/civil union partner, if filing jointly) cannot receive Social Security or Railroad Retirement benefits, but you would have been eligible for benefits if you had fully participated in either program.

More Information

See Tax Topic Bulletin GIT-1&2 Retirement Income, for more information.


Last Updated: Friday, 08/28/20