Property Tax Benefits
Property Tax Reimbursement Eligibility Requirements (Senior Freeze)
You may be eligible for a reimbursement of the difference between the amount of property taxes you paid in the base year (the year you first became eligible) and the amount paid in the year for which you are applying for a reimbursement if you met all the following requirements for the base year and for each succeeding year, up to and including the year for which you are claiming the reimbursement.
- You are age 65 or older or receiving Federal Social Security disability benefits; and
- You have lived in New Jersey continuously for at least the last 10 years, as either a homeowner or a renter; and
- You have owned and lived in your home (or have leased a site in a mobile home park on which you have placed a manufactured or mobile home that you own) for at least the last 3 years; and
- You have paid the full amount of property taxes (or site fees if you are a mobile home owner) that were due on your home for the base year and for each succeeding year, up to and including the year for which you are claiming the reimbursement; and
- You meet the income limits for the base year and for each succeeding year, up to and including the year for which you are claiming the reimbursement.
Residents applying for the 2007 reimbursement must have total income for 2006 that is less than $43,693 for single applicants and $53,576 (combined income) for married couples, and total income for 2007 that is less than $45,135 for single applicants and $55,344 (combined income) for married/civil union couples.
Note: The Civil Union Act (P.L. 2006, c.103) established civil unions in New Jersey for couples of the same sex. Beginning with tax year 2007, partners to a civil union recognized under New Jersey law are accorded the same status as married couples. When applying for the property tax reimbursement, civil union partners will use the status married/CU couple only for tax years beginning on or after January 1, 2007. Civil union couple status does not apply for tax year 2006.
If your residence is in a multiple-unit building that you own, and the building has more than four units, you are not eligible for a property tax reimbursement. You are also not eligible if the building has four units or less but more than one commercial unit.
Property Tax Deduction/Credit
Eligible homeowners and tenants who pay property taxes, either directly or through rent, on their principal residence in New Jersey are eligible for either a deduction or a refundable credit on their New Jersey resident income tax return. Homeowners and tenants may be eligible for a deduction or credit even if they are not eligible for a homestead rebate.
Qualified residents may deduct 100% of their property taxes due and paid or $10,000 whichever is less. For tenants, 18% of rent paid during the year is considered property taxes paid. The minimum benefit is a refundable credit of $50.
To determine whether you will receive a greater tax benefit by taking the deduction or credit, complete Schedule 1 contained in the New Jersey Resident Income Tax Return instruction booklet ( Form NJ-1040), unless you are claiming a credit for taxes paid to another jurisdiction. If you are using NJ WebFile or the program will determine the greater benefit for you.
Eligible residents who are 65 years of age or older or blind or disabled and who are not required to file a return because their income is below the minimum filing threshold apply for the credit as follows: Residents who file only the homestead rebate application will automatically receive their property tax credit with their homestead rebate. These residents should not complete Line 36c, Form NJ-1040 to claim a property tax deduction or Line 48, Form NJ-1040 to claim a property tax credit even if they file an income tax return.
Residents who are not eligible for the homestead rebate because on October 1, 2007, they were neither homeowners nor tenants may complete the New Jersey income tax return to claim their property tax credit. Such taxpayers must complete Line 48, Form NJ-1040 to claim their property tax credit. Residents who are not 65 years of age or older or blind or disabled and who are not required to file a return because their income is below the minimum filing threshold are not eligible for a property tax credit. Additional information on the property tax deduction or credit is contained in the resident income tax instruction booklet.
ALL PROPERTY TAX RELIEF PROGRAM INFORMATION PROVIDED HERE IS BASED ON CURRENT LAW AND IS SUBJECT TO CHANGE.