New Jersey gives qualified homeowners and tenants either a property tax deduction or credit. TurboTax will compute the best result for you.
Check your answers property tax deduction/credit screens to make sure you filled out the information correctly. Also check whether the about of property taxes paid on principal residence is correct on the screen We Need to Know About Your Property Taxes.
Homeowners and tenants who pay property taxes on a primary residence (main home) in New Jersey, either directly or through rent, may qualify for either a deduction or a refundable credit when filing an Income Tax return.
The property tax deduction reduces your taxable income. You can deduct your property taxes paid or $15,000, whichever is less. For Tax Years 2017 and earlier, the maximum deduction was $10,000. For tenants, 18% of rent paid during the year is considered property taxes paid. Keep in mind that the amount of property taxes paid that you can deduct depends on a number of factors, such as the number of owners or units. Visit Determining the Amount of Property Taxes Paid for more information.
The property tax credit reduces your tax due because it is subtracted directly from your tax liability. The benefit is a refundable credit of $50.
You can claim only one of these benefits on your tax return. If you qualify (see Eligibility Requirements), follow the instructions in the New Jersey Resident Income Tax return (Form NJ-1040 ) to determine if the credit or deduction will give you the greater benefit.
Refer to: NJ Income Tax Property Tax Deduction/Credit for Homeowners and Tenants
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