These are the reductions traded for the gas tax.
The long-disputed gas tax hike—a staggering 23-cent-per-gallon increase—that was approved in 2016 already took effect in November, and you’ve no doubt noticed the difference at the pump. However, there are also a handful of other tax changes that took effect as of Jan. 1, passed in exchange for the gas tax. Here’s a refresher:
Previously, estates of up to $675,000 were exempt from New Jersey’s estate tax. Now, the threshold has risen to $2 million, and the tax will be eliminated entirely on Jan. 1, 2018.
New Jersey’s sales and use tax has decreased to 6.875 percent from 7 percent and will decrease another two-eighths of a point on Jan. 1, 2018. Click here for more information on how to plan accordingly.
New Jersey residents who are 62 and older can exclude up to $40,000 in pension and other retirement income—such as annuity income and savings account withdrawals—from their taxes. This has increased from $20,000 in 2016 and will rise again to $100,000 in 2020. Individuals and those married but filing separately can now exempt $15,000, up from $10,000.
Earned Income Tax Credit
The state’s EITC, which reduces tax payments for low- and moderate-income workers—has increased by 5 percent from 2016 and is now 35 percent of the federal EITC.
Veterans who have been honorably discharged or released from service can now claim an annual tax exemption of $3,000.