2015, 2016 New Jersey earned income tax credit EITC

The New Jersey Earned Income Tax Credit (NJEITC) is a credit for certain residents who work and have earned income. The credit reduces the amount of New Jersey tax you owe and may also give you a refund, even if you have no tax liability to New Jersey.

 

What is NJ EITC?

New Jersey wage earners can also take advantage of the state’s own EITC program. Residents who are eligible and file for a Federal earned income credit can also receive a New Jersey earned income credit in the amount equal to 20% of their Federal earned income credit.

The New Jersey Earned Income Tax Credit (EITC)

The Earned Income Tax Credit (EITC) is a federal and state tax benefit for individuals and families who earn low-to moderate incomes in NJ. It is a tax credit that may reduce the amount of taxes you owe, or provide you with a refund, even if you don’t owe any taxes. To get the NJ state EITC, you must file a federal tax form, be eligible for the federal EITC and file a state income tax return (if you are married but file separately, you may not claim the NJ EITC).

Claiming 2015 New Jersey Earned Income Tax Credit (NJEITC)

Most residents who are eligible and file for a Federal earned income credit can also receive a New Jersey earned income tax credit. For 2014 the New Jersey Earned Income Tax Credit (NJEITC) is 20% of the applicant’s Federal earned income credit. For example, if your Federal earned income credit is $3,000, the amount of your NJEITC will be $600 (2014 NJEITC = Federal EIC x 20%). Part-year residents who qualify for the NJEITC must prorate the amount of the credit based on the number of months as a New Jersey resident.

 

2015 New Jersey Earned Income Tax Credit (NJEITC)

The amount of your NJEITC is a percentage of your federal earned income tax credit. This year, the NJEITC amount is equal to 30 percent of the federal earned income tax credit. So, if your federal earned income tax credit is $4,000, the amount of your NJEITC will be $1,200. (2015 NJEITC = federal EITC x 30 percent) Note: If you lived in New Jersey for only part of 2015, your NJEITC will be prorated based on the number of months you were a New Jersey resident. (For this calculation, 15 days or more is a month.) To receive the NJEITC, you must file a New Jersey resident income tax return. This is true even if you are not required to file a tax return because your income is below New Jersey’s minimum filing threshold.

Requirement to Notify Employees of Potential Earned Income Tax Credit (EITC) Eligibility

For the 2015 tax year, the employee must have earned income (wages, net profits from business) and their adjusted gross income (AGI) must be less than: • $47,747 ($53,267 if married filing jointly) with three or more qualifying children • $44,454 ($49,974 if married filing jointly) with two qualifying children • $39,131 ($44,651 if married filing jointly) with one qualifying child • $14,820 ($20,330 if married filing jointly) with no qualifying children.

 

Amount of New Jersey Earned Income Tax Credit

To qualify, your earned income and adjusted gross income (AGI) must be less than:

  • $46,997 ($52,427 married filing jointly) with three or more qualifying children
  • $43,756 ($49,186 married filing jointly) with two qualifying children
  • $38,511 ($43,941 married filing jointly) with one qualifying child
  • $14,590 ($20,020 married filing jointly) with no qualifying children

For the 2014 Tax year, you could receive a maximum federal credit of:

  • $6,143 with three or more qualifying children
  • $5,460 with two qualifying children
  • $3,305 with one qualifying child
  • $496 with no qualifying children

And a maximum NJ state earned income credit of:

  • $1228 with three or more qualifying children
  • $1092 with two qualifying children
  • $661 with one qualifying child
  • $99 with no qualifying children

 

Other Benefit Programs in New Jersey

  • Food Stamps
  • Medicaid (Health Insurance)
  • NJ FamilyCare (affordable health insurance for children)
  • Low Income Home Energy Assistance Program (heating bill assistance)
  • Temporary Assistance to Needy Families (welfare services and cash assistance for families with children)
  • General Assistance (welfare services and cash assistance for childless adults)
  • NJ Cares for Kids (child care subsidies)
  • Kinship Navigator (provides support and assistance to adults raising a relative’s child)