topic New Jersey State Tax: should capital losses from sale of vanguard long term NJ muni bond fund (VNJUX) be excluded from Schedule NJ-DOP, if so, how to get TT to do this? in State tax filing

New Jersey State Tax: should capital losses from sale of vanguard long term NJ muni bond fund (VNJUX) be excluded from Schedule NJ-DOP, if so, how to get TT to do this?

kheshgi4 — Mon, 09 Mar 2026 09:07:50 GMT

I am using TT online and it is not clear how to exclude sale of NJ qualified funds from Schedule NJ-DOP.

Re: New Jersey State Tax: should capital losses from sale of vanguard long term NJ muni bond fund (VNJUX) be excluded from Schedule NJ-DOP, if so, how to get TT to do this?

fanfare — Sat, 05 Mar 2022 06:14:13 GMT

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Re: New Jersey State Tax: should capital losses from sale of vanguard long term NJ muni bond fund (VNJUX) be excluded from Schedule NJ-DOP, if so, how to get TT to do this?

SundayInSalem — Sat, 05 Mar 2022 05:23:42 GMT

Distributions and gains from a New Jersey qualified investment fund are exempt from State Income Tax if they are derived from the qualified nontaxable debt obligations held by the fund. A qualified investment fund must:
• Be a regulated investment company;
• Invest 80% or more of its funds (other than cash or receivables) in securities that are exempt from New Jersey Income Tax; and
• Complete and retain Form IF-1, Certification of Qualified Investment Fund, to document its status. This certification does not need to be filed with us, but must be made available upon request.

Distributions received by shareholders of mutual funds are subject to New Jersey Income Tax as dividends and/or capital gains, unless the fund is considered a qualified investment fund for New Jersey purposes.

To exempt a capital gains transaction from New Jersey taxation:

Go to the New Jersey section
Continue to Any sales of property not subject to New Jersey tax?
Say Yes and check the Omit box for any gain or loss not subject to NJ taxation.

Learn more at Nontaxable Investment Income.

Re: New Jersey State Tax: should capital losses from sale of vanguard long term NJ muni bond fund (VNJUX) be excluded from Schedule NJ-DOP, if so, how to get TT to do this?

kheshgi4 — Wed, 09 Mar 2022 15:30:12 GMT

Thanks, for the reply.

I have 3 different types of distributions from the fund to account for in my NJ return:

1. capital loss from sale of fund: I have omitted this as you have explained

2. long term capital gain distribution: I have reduced the overall capital gain distribution number to account for this distribution not being taxable in NJ but being taxable for Federal.

3. short term capital gain distribution that is included in form 1099-div as ordinary dividends: I have tried to reduce the dividend number in TT's NJ section but it reverts to what is shown in Federal Sch B. Is there are way to account for this ST gain so that it is not taxed in NJ?