Updated for tax year 2025.
If you live or work in New Jersey, you’ll likely need to file a New Jersey state income tax return along with your federal return. New Jersey has a progressive income tax system with graduated rates, so the amount you owe depends on your filing status and taxable income.
This guide explains New Jersey’s 2025 income tax rates and brackets, available exemptions, deductions, and credits, and the updates for the current tax year. When you’re ready to file, TaxAct® automatically applies New Jersey’s tax rules to help you accurately prepare your New Jersey return alongside your federal return.
What is the New Jersey state income tax?
New Jersey state income tax is a tax on income earned by individuals. It is collected by the New Jersey Division of Taxation and helps fund state services.
New Jersey uses a graduated income tax, which means higher portions of taxable income are taxed at higher rates. Certain types of income, such as Social Security benefits, unemployment compensation, and lottery winnings below $10,000, are not taxed at the state level.
New Jersey income tax rates and tax brackets
The state of New Jersey is known for having one of the highest income tax rates in the United States. Here is a look at the tax brackets based on filing status.
Single filers and married filing separately 2025 NJ tax brackets:
Married filing jointly and heads of household 2025 NJ tax brackets:
If you need more information on how federal tax brackets work, you can use our tax bracket calculator for federal taxes.
New Jersey standard deduction
New Jersey does not offer a standard deduction on its state income tax return. Most federal itemized deductions, such as mortgage interest and IRA contributions, are also not allowed on a New Jersey return. Instead, New Jersey allows certain state-specific deductions and personal exemptions that may reduce your taxable income (see below).
New Jersey exemptions, deductions, and credits
New Jersey offers several exemptions and credits that may reduce what you owe. Common items include:
Regular personal exemption — $1,000 for you and, if filing jointly, $1,000 for your spouse, civil union partner, or domestic partner.
Dependent exemption — $1,500 for each child or dependent who qualifies as your dependent for federal tax purposes.
Senior 65+ exemption — additional $1,000 if you were 65 or older on the last day of the tax year (and the same for a qualifying spouse on a joint return).
Blind or disabled exemption — additional $1,000 if you were blind or disabled on the last day of the tax year (and the same for a qualifying spouse on a joint return).
Veteran exemption — $6,000 if you are a military veteran honorably discharged from active duty before the last day of the tax year (and the same for a qualifying spouse on a joint return).
Dependent attending college exemption — an additional $1,000 for each dependent student under age 22 attending college full-time who meets New Jersey requirements.
Property tax deduction or refundable property tax credit — may be available for certain New Jersey homeowners or tenants.
New Jersey Earned Income Tax Credit (NJEITC) — for tax year 2025, the NJEITC is 40% of your federal Earned Income Tax Credit for eligible residents.
New Jersey Child Tax Credit — $200-$1,000 (amount based on income) per dependent age 5 or younger for residents with a taxable income of $80,000 or less (not available if filing married filing separately).
For a full list of allowable New Jersey income tax deductions and exemptions, see the New Jersey Division of Taxation.
Live in New Jersey but work in New York?
If you were a resident of New Jersey for any part of the year, you must file a New Jersey state income tax return. That includes living in New Jersey for only part of the year. You will owe personal income tax to New Jersey on your New York wages, even if your employer didn’t withhold New Jersey income tax from your pay. If New York income tax was withheld, you need to file a New York state nonresident tax return to receive a refund of the tax paid to New York.
For more details about living and working in different states, check out our article on tax reciprocity.
New Jersey tax changes for 2025
New Jersey’s graduated income tax rate structure (1.40% to 10.75%) remains in place for tax year 2025.
Personal exemption amounts are unchanged for 2025.
The New Jersey Earned Income Tax Credit for 2025 remains 40% of the federal Earned Income Tax Credit.
The New Jersey Child Tax Credit provides up to $1,000 per dependent age 5 or younger for residents with taxable income of $80,000 or less.
Taxpayers with excess unemployment, disability, or family leave insurance withholding from multiple employers may claim a credit using Form NJ-2450.
FAQs
The bottom line
New Jersey has a graduated state income tax with rates from 1.40% to 10.75% for 2025. Understanding how New Jersey calculates taxable income, exemptions, deductions, and available credits can help you estimate what you may owe — and what you may get back.
When you’re ready to file, TaxAct can help you prepare your federal and New Jersey returns in one place so you can file with confidence.
Already filed your taxes and waiting for your refund? Learn more about where your New Jersey state tax refund is.
This article is for informational purposes only and not legal or financial advice.
All TaxAct offers, products and services are subject to applicable terms and conditions.
The OBBB is now also being referred to by lawmakers as the Working Families Tax Cut Act. You may see one or both names used here, but they refer to the same set of tax changes.
Citations
New Jersey Division of Taxation. “NJ Income Tax Rates.” Accessed 22 July 2026.New Jersey Division of Taxation. “Income Tax – Deductions.” Accessed 22 July 2026.New Jersey Division of Taxation. “Income Tax Changes for Tax Year 2025.” Accessed 22 July 2026.TaxAct. “Working Families Tax Cuts Act: 2025 Tax Reform Explained.” TaxAct Blog.TaxAct. “Where’s My New Jersey State Tax Refund?” TaxAct Blog.
