I am a NJ renter and right now Turbo Tax is calculating my NJ Property Tax Credit as 18% of my total rent paid in 2019. However isn't the max credit $50?

[JulieS]

Yes, the maximum credit is $50. I think this may just be a question of where and how the credit is reported on the NJ-1040 tax form.

When you are a renter, 18% of your gross rent paid is considered as property tax paid. This amount shows on line 38a of the NJ-1040 form. The amount of your allowed credit is on line 55, which should be no more than $50. 

[jmpc21891]

I understand that but the turbo tax program is not doing that, it is instead using 18% of my total rent versus capping it at $50. How do I stop turbo tax from incorrectly calculating this?

[fanfare]

Turbotax uses the rules to determine whether you get the 18% of rent deduction  OR the 50 dollar credit.

Big difference between a deduction and a credit.

Don't worry, Be happy.

[fanfare]

you are entitled to one but not both.

The tax treatment is to use the option that is more favorable to the taxpayer.

[jmpc2189]

I understand I am not entitled to both but based on the NJ Worksheet the max you are eligible to get is $50, but the way it's currently being calculated on Turbo tax I am getting a credit of MORE than $50. I am worried to submit my return if there is a glitch in the system that lets me deduct more than what the state allows.

[fanfare]

No.... $50 is the minimum benefit you will get, not the maximum.

[Critter]

Again you are confusing deductions and credits ... they are not the same.