ACR145

Sponsored by:

Assemblyman ROY FREIMAN

District 16 (Hunterdon, Mercer, Middlesex and Somerset)

Assemblywoman JOANN DOWNEY

District 11 (Monmouth)

Assemblyman DANIEL R. BENSON

District 14 (Mercer and Middlesex)

Co-Sponsored by:

Assemblywomen Murphy, Mosquera and Assemblyman Houghtaling

SYNOPSIS

Urges Congress to take swift action to protect New Jersey taxpayers from recently enacted federal tax legislation.

CURRENT VERSION OF TEXT

As introduced.

A Concurrent Resolution urging Congress to take swift action to protect New Jersey taxpayers from recently enacted federal tax legislation.

Whereas, On December 22, 2017, following narrow passage in Congress and with the support of just one member of New Jersey’s Congressional delegation, President Trump signed the “Tax Cuts and Jobs Act,” Pub.L.115-97; and

Whereas, Though the legislation doubled the standard deduction taxpayers will be allowed to deduct from gross income on their federal tax forms, it eliminated personal and dependent exemptions, capped the state and local tax deduction at $10,000, and lowered the amount that can be deducted for mortgage interest on homes; and

Whereas, The state and local tax deduction is a deduction for property taxes paid combined with either state income or sales taxes paid; and

Whereas, According to the most recent available data, more than 40 percent of New Jersey residents utilize the state and local tax deduction to lower their federal tax burden, a higher percentage of residents than in all other states but two, and for New Jersey residents utilizing the state and local tax deduction, the average deduction is $17,850, the fourth highest state average in the country; and

Whereas, Taxpayers in every New Jersey county and of all income levels utilize the state and local tax deduction; close to 50 percent of New Jersey households utilizing the state and local tax deduction have annual incomes below $100,000, including 20 percent of New Jersey households with annual incomes below $50,000; and

Whereas, Because so many New Jersey residents utilize the state and local tax deduction, the $10,000 cap on the deduction is especially harmful to New Jersey residents as the amount of state and local taxes paid in excess of the cap will now be counted as income subject to federal taxation; and

Whereas, The cap on the state and local tax deduction means that money that could otherwise be utilized for food, healthcare, education, and other everyday living expenses must instead be paid in taxes; and

Whereas, It is imperative that Congress now takes immediate action to look for ways to lessen the negative impact of the tax legislation on New Jersey taxpayers; now, therefore,

Be It Resolved by the General Assembly of the State of New Jersey (the Senate concurring):

1. The Legislature of the State of New Jersey urges Congress to immediately explore all possible means to lessen the negative impact of the 2017 federal tax reform legislation on New Jersey taxpayers.

2. Copies of this resolution, as filed with the Secretary of State, shall be transmitted by the Clerk of the General Assembly or Secretary of the Senate to each member of Congress elected from the State of New Jersey.

STATEMENT

This resolution urges Congress to immediately explore options to lessen the impact of the 2017 federal tax reform legislation on New Jersey taxpayers. Among other changes affecting New Jersey residents, the legislation put a $10,000 cap on deductions allowed for state and local taxes paid. New Jersey taxpayers across the State and of all income levels utilize the state and local tax deduction to lower their federal tax burden.

The new $10,000 limit on the state and local tax deduction will increase the federal tax liability of many taxpayers, leaving those taxpayers with fewer dollars to spend on food, healthcare, education, and other everyday living expenses. New Jersey residents are harmed by the deduction limit more so than taxpayers of almost all other states because New Jersey has the third highest percentage of taxpayers utilizing the deduction in the country and those utilizing the deduction in the State deduct an average of $17,850, the fourth highest state average in the country.

Accordingly, the Legislature urges Congress to immediately explore options to lessen the negative impact of the 2017 federal tax reform legislation on New Jersey taxpayers.