Legislation Would Eliminate $10,000 Cap on State Property Tax Deduction
Senator Joe Pennacchio (R-26) called on Governor-elect Phil Murphy to support his newly introduced legislation that would allow New Jersey homeowners and renters to fully deduct their property taxes, eliminating the existing $10,000 limit on the state property tax deduction.
Sen. Joe Pennacchio called on Governor-elect Phil Murphy to support his new legislation allowing New Jersey homeowners and renters to fully deduct their property taxes. (SenateNJ.com)
“Governor-elect Murphy and many state lawmakers of both parties have vocally opposed federal tax reforms that would limit the federal deductibility of property taxes to $10,000,” said Pennacchio. “At the same time, few have discussed the negative impact of New Jersey’s long-standing $10,000 limit on our state’s property tax deduction. Rather than simply criticizing officials in Washington, Governor-elect Murphy should see this as an opportunity to work with lawmakers in Trenton to fix something that we have the power to fix to make New Jersey more affordable.”
The maximum deduction that can be claimed under the New Jersey Gross Income Tax for property taxes is currently $10,000.
Pennacchio’s new legislation, S-3598, would remove that limit.
While no limit currently exists for the amount of property taxes that may be deducted on federal income taxes, proposed federal tax reforms would impose a limit that matches New Jersey’s of $10,000.
Pennacchio supported a Senate resolution (SR-139) that passed on October 5th with bipartisan support (34-0) which expressed opposition to the full elimination of the federal deduction for property taxes as was proposed under an initial federal tax reform proposal.
Regarding his new legislation, Pennacchio said it would be completely disingenuous to express outrage over limiting the federal deduction to $10,000 for property taxes without doing anything to increase the state deduction that already has such a limit.
“If we’re going to say that having no limit for property tax deductions is the right policy, then let’s change our New Jersey laws to match our rhetoric,” Pennacchio added.
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