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MD

Bill

A 5329

Increases amount of child tax credit in taxable years 2026, 2027, and 2028.

2026-2027 Regular Session Introduced by Mitchelle Drulis and 6 co-sponsors

New Jersey temporarily boosts the child tax credit for families with children under six from 2026–2028, with higher amounts at lower incomes and refundable benefits.

Substituted by S4531
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WeVote Research Nonpartisan
Bill Summary · A 5329

Summary of Bill A 5329 (Session 222, New Jersey)

Purpose and intent

  • Temporarily increases the New Jersey child tax credit for taxable years 2026, 2027, and 2028.
  • After 2028, the credit would revert to the current, pre-2026 amounts.
  • The bill aims to provide greater support to low- and middle-income families with young children (under age six) by raising the credit amounts during the specified years.

Key provisions and changes

  • Scope of credit: Applies to resident taxpayers with New Jersey gross income tax liability and with at least one child under age six for whom the taxpayer claims a deduction under N.J.S.54A:3-1. Applies regardless of filing status in determining eligibility, subject to income limits.

  • Income thresholds and credit amounts (temporary enhancement for 2026–2028):

    • If taxable income is:
    • $30,000 or under: credit increases from $1,000 to $1,250
    • Over $30,000 but not over $40,000: credit increases from $800 to $1,000
    • Over $40,000 but not over $50,000: credit increases from $600 to $750
    • Over $50,000 but not over $60,000: credit increases from $400 to $500
    • Over $60,000 but not over $80,000: credit increases from $200 to $250
    • Note: These amounts apply to taxable years 2026, 2027, and 2028.

  • Eligibility and administration:

    • The credit is refundable to the extent it exceeds the tax due (i.e., excess is treated as a refundable overpayment).
    • Taxpayers may claim the credit whether they file with a Social Security Number (SSN) or an Individual Taxpayer Identification Number (ITIN).
    • Joint filing: Generally requires a joint return for married taxpayers, except for individuals who file as head of household or surviving spouse for federal purposes.
    • Part-year residents: Credit is prorated based on the portion of the year the taxpayer resided in New Jersey (15 days or more constitutes a month).
    • The credit does not count as income for determining eligibility for other state benefits or assistance, to the extent allowed by federal law.
    • Data reporting: The Division of Taxation must include in the annual tax expenditure report the number of claimants, their income, number of children benefiting, and average credit per child and per claimant.

  • Effective date: The act takes effect immediately and applies to taxable years beginning on or after January 1, 2026.

Who would be affected

  • Primary beneficiaries: Resident New Jersey taxpayers with at least one child under age six and with income up to $80,000 (for the purposes of the credit's income brackets).
  • Other impact considerations:
    • Taxpayers using ITINs or SSNs to file would be eligible.
    • Part-year residents receive a prorated credit.
    • The change is temporary (2026–2028) and would revert to current law thereafter.

Procedural and timeline aspects

  • Introduction and referral: Introduced and referred to Assembly Budget Committee on 2026-06-23.
  • Sponsors: Primary sponsor with co-sponsors Eliana Pintor Marin and Verlina Reynolds-Jackson.
  • Effective date and applicability: Immediate effect; applies to tax years beginning after January 1, 2026.

Practical takeaways

  • This bill provides a short-term uplift in the New Jersey Child Tax Credit amounts for eligible families, with larger credits at lower income levels and a gradual phase-in across brackets. The refundable nature means families could receive more than their tax liability, and the program remains accessible to those using ITINs. The program’s temporary nature will require future legislative action to extend or modify beyond 2028.

Compiled from official sources — confirm details with the bill’s official record.

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