The U.S. state of New Jersey levies a state personal income tax and state corporate income tax and a state sales tax. Property taxes are also levied by municipalities, counties, and school districts.
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Income tax
The tax table below will show in detail the New Jersey state income tax rates by income tax bracket(s). There are 6 income tax brackets for New Jersey.
Tax brackets for individuals are provided below:
For earnings between $0 and $20,000, the tax rate on every dollar of income earned is 1.4%.
For earnings between $20,001 and $35,000, the tax rate on every dollar of income earned is 1.75%.
For earnings between $35,001 and $40,000, the tax rate on every dollar of income earned is 3.5%.
For earnings between $40,001 and $75,000, the tax rate on every dollar of income earned is 5.525%.
For earnings between $75,001 and $500,000, the tax rate on every dollar of income earned is 6.37%.
For earnings of $500,001 and over, the tax rate on every dollar of income earned is 8.97%.
To give an example, if you file individually and your earned income is $50,000 your tax will be calculated the following way: ($20,000 (first bracket) x 1.4%) + ($15,000 (second bracket) x 1.75%) + ($5,000 (third bracket) x 3.5%) + ($10,000 (fourth bracket) x 5.525%) = $280 + $262.50 + $175 + $552.50 = $1,270, for an overall rate of 2.54%.
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Sales tax
New Jersey has a 6.625% state sales tax, which was cut in steps from the previous rate of 7%. All revenues are deposited in the State Treasury for general State use; nothing goes to municipalities.
In Urban Enterprise Zones, the State sales tax is cut in half to encourage economic development, resulting in an effective tax rate of 3.3125%. A full list of Urban Enterprise Zones is available on the State of New Jersey Web site. [1]
New Jersey does not charge sales tax on unprepared food, household paper products, medicine, and clothing. However fur clothing is subject to sales tax.
New Jersey does not charge sales tax on gasoline, but gasoline is subject to a $0.375/gallon excise tax.
Cigarettes are subject to a $2.70/per pack excise tax in addition to sales tax.
Property tax
New Jersey has the highest median property tax in the United States, at $5,773.[2] Former Governor Jon Corzine and Bergen County executive Dennis McNerney have suggested that smaller municipalities merge into larger municipalities to share services and reduce overhead.
See also
- Law of New Jersey
References
http://www.state.nj.us/treasury/taxation/su_over.shtml
External links
- State of New Jersey Division of Taxation
- The Tax Foundation research on New Jersey
Source of article : Wikipedia
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