For the full state income tax comparison and relocation planning framework, see the State Taxes hub.
New Jersey has high income taxes — 1.4% to 10.75% — but generous retirement exemptions and sales tax exemptions on essentials like groceries and clothing.
New Jersey Tax Rates 2026
Bracket thresholds below reflect the last confirmed structure. Confirm exact current-year thresholds with the New Jersey Division of Taxation, as they can be adjusted.
Single Filers
| Taxable Income | Rate |
|---|---|
| $0 - $20,000 | 1.4% |
| $20,001 - $35,000 | 1.75% |
| $35,001 - $40,000 | 3.5% |
| $40,001 - $75,000 | 5.525% |
| $75,001 - $500,000 | 6.37% |
| $500,001 - $1,000,000 | 8.97% |
| $1,000,001+ | 10.75% |
Married Filing Jointly
| Taxable Income | Rate |
|---|---|
| $0 - $20,000 | 1.4% |
| $20,001 - $50,000 | 1.75% |
| $50,001 - $70,000 | 2.45% |
| $70,001 - $80,000 | 3.5% |
| $80,001 - $150,000 | 5.525% |
| $150,001 - $500,000 | 6.37% |
| $500,001 - $1,000,000 | 8.97% |
| $1,000,001+ | 10.75% |
How Much Will I Pay in New Jersey Tax? (Illustrative)
Confirm exact figures with a current-year calculator or the NJ Division of Taxation; the table below is illustrative based on the bracket structure above.
| Taxable Income | Single Tax (approx.) | Married Tax (approx.) |
|---|---|---|
| $50,000 | ~$1,894 | ~$1,228 |
| $75,000 | ~$3,276 | ~$2,350 |
| $100,000 | ~$4,869 | ~$3,731 |
| $150,000 | ~$8,053 | ~$6,493 |
| $200,000 | ~$11,238 | ~$9,678 |
| $500,000 | ~$30,288 | ~$28,728 |
| $1,000,000 | ~$75,138 | ~$73,578 |
New Jersey vs. Neighboring States
| State | Top Rate | Notes |
|---|---|---|
| New York | 10.9% | NYC residents pay an additional local income tax |
| New Jersey | 10.75% | $1M+ income |
| Pennsylvania | 3.07% | Flat rate |
| Delaware | 6.6% | No sales tax |
| Connecticut | 6.99% | Confirm current top-bracket threshold |
New Jersey Exemptions and Deductions
Personal Exemptions
Confirm current-year exemption amounts with the New Jersey Division of Taxation, as these were not independently re-verified this session.
Deductions
NJ has limited deductions:
| Deduction | Allowed? |
|---|---|
| Medical expenses | Yes |
| Property taxes | Limited (confirm current cap) |
| Alimony paid | Yes |
| Self-employed health insurance | Yes |
| Student loan interest | No |
| Standard deduction | No |
New Jersey has no standard deduction — you report gross income minus limited deductions.
New Jersey Retirement Income Exclusion
NJ offers a retirement income exclusion for those 62+ (or disabled). Confirm the current-year maximum exclusion amounts by filing status, and the gross income phase-out threshold, with the New Jersey Division of Taxation — these figures were not independently re-verified this session and NJ has adjusted them in past legislative sessions.
What Qualifies
| Income Type | Eligible? |
|---|---|
| Social Security | Not taxed at all |
| Pension | Yes |
| 401(k)/403(b) | Yes |
| Traditional IRA | Yes |
| Annuities | Yes |
| Military retirement | Exempt (no age limit) |
New Jersey Property Tax
NJ has historically had among the highest property taxes in the nation. Confirm the current average effective rate and typical dollar amounts with the Tax Foundation or New Jersey Division of Taxation, as these figures were not independently re-verified this session.
New Jersey Property Tax Relief
Homestead Benefit
Confirm current qualification criteria and credit amounts with the New Jersey Division of Taxation, as this program (sometimes rebranded, e.g., “ANCHOR”) has changed structure and amounts in recent years.
Senior Freeze (PTR)
Reimburses property tax increases for eligible seniors 65+ — confirm the current income limit and eligibility rules with the New Jersey Division of Taxation.
New Jersey Sales Tax
| Rate Type | Amount |
|---|---|
| Standard rate | 6.625% |
| Urban Enterprise Zone | Reduced rate (confirm current percentage) |
| Salem County | Reduced rate (confirm current percentage) |
Sales Tax Exemptions
NJ exempts many items:
| Item | Taxable? |
|---|---|
| Clothing | Exempt |
| Most food | Exempt |
| Prescription drugs | Exempt |
| OTC medicine | Taxable |
| Electronics | Taxable |
| Prepared food | Taxable |
New Jersey Tax Credits
Confirm current amounts and percentages with the New Jersey Division of Taxation, as these figures are periodically adjusted:
| Credit | Amount (confirm current figure) |
|---|---|
| Earned Income Tax Credit | A percentage of the federal EITC |
| Child Tax Credit | Confirm current per-child amount |
| Dependent Care Credit | Available |
| Property Tax Credit/Deduction | Confirm current maximum deduction |
Who Must File New Jersey Taxes?
You must file if you’re a:
- NJ resident with gross income over a set threshold (confirm current amounts by filing status)
- Part-year resident with NJ income
- Nonresident with NJ source income
New Jersey Filing Options
| Method | Cost |
|---|---|
| NJ Free File | Free (confirm current income eligibility limit) |
| NJ Online | Free |
| Commercial software | $0-$50 |
| Tax professional | $150-$400 |
Filing deadline: April 15
New Jersey Capital Gains
NJ taxes capital gains as ordinary income, with no exclusion or preferential rate for long-term gains.
New Jersey Local Income Tax
NJ has no local income taxes. Only state income tax applies.
Millionaire’s Tax
NJ has a “millionaire tax” — the 10.75% rate kicks in at $1 million, creating a notable jump from the 8.97% marginal rate just below that threshold.
Is New Jersey Tax-Friendly for Retirees?
Somewhat:
- Social Security not taxed
- Retirement income exclusion available for filers 62+ (confirm current amount)
- Retirement exclusion has income phase-out limits
- Property taxes are historically among the highest in the US
Bottom Line
New Jersey has progressive income tax rates from 1.4% to 10.75%, with the top rate applying to income over $1 million. Property taxes are among the highest in the nation. Retirement income gets a meaningful exclusion for those 62+ (confirm current amount), and Social Security isn’t taxed. Sales tax exemptions on clothing and groceries provide some relief. The overall tax burden is high, especially for wealthy homeowners.
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