S2303

An Act providing a gross income tax credit for certain expenses paid or incurred for the care and support of a qualifying senior family member and designated as the Caregiver’s Assistance Act and supplementing chapter 4 of Title 54A of the New Jersey Statutes.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. a. A qualified caregiver having gross income for the taxable year not in excess of $100,000, or not in excess of $50,000 if married or a civil union partner filing separately or if unmarried, not a partner in a civil union, and not filing or eligible to file as head of household or as a surviving spouse for federal income tax purposes, shall be allowed a credit against the tax otherwise due for the taxable year under the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., in an amount equal to 22.5 percent of the qualified care expenses paid or incurred by the qualified caregiver during the taxable year for the care and support of a qualifying senior family member that are not in excess of $3,000.

b. If two or more qualified caregivers are allowed a credit in accordance with subsection a. of this section for the same qualifying senior family member, the total amount of the credit allowed shall be allocated in equal amounts between or among each of the qualified caregivers unless the qualified caregivers submit an agreement in writing to the director establishing a different allocation.

c. If a qualified caregiver is allowed a credit in accordance with subsection a. of this section and, during the same taxable year, is allowed a dependent deduction in accordance with paragraph 2 of subsection (b) of N.J.S.54A:3-1 for the qualifying senior family member whose care and support is the basis for the credit allowed in accordance with subsection a. of this section, the qualified caregiver shall be allowed to claim both the deduction and the credit in determining the tax otherwise due for the taxable year under N.J.S.54A:1-1 et seq.

d. If the credit allowed in accordance with subsection a. of this section, together with any other payments and any other credits, deductions, and adjustments allowed by law, reduces the tax liability otherwise due for the taxable year under N.J.S.54A:1-1 et seq. to zero, the amount of the credit remaining shall be paid to the taxpayer as a refund of an overpayment of tax in accordance with N.J.S.54A:9-7; provided however, that subsection (f) of that section, concerning the allowance of interest, shall not apply.

e. The credit for a qualified caregiver who is allowed a credit in accordance with subsection a. of this section but who, in accordance with N.J.S.54A:2-4, is not subject to tax, shall be applied for annually on an application as shall be made available by the director, to be filed with the director on or before the date for filing annual gross income tax returns. The director shall determine the form and manner by which a qualified caregiver who is allowed a credit in accordance with subsection a. of this section shall apply for a refund of an overpayment of tax, and the time of the refund of the overpayment of tax.

f. As used in this section:

“Qualified care expenses” means expenses paid or incurred by a qualified caregiver for the purchase, lease, or rental of tangible personal property and services that are necessary to allow a qualifying senior family member to be maintained within or at the qualified caregiver’s or the qualifying senior family member’s permanent place of abode in this State, which property and services are provided to or for the benefit of the qualifying senior family member or to assist the qualified caregiver in providing care and support to the qualifying senior family member or are provided by an organization or an individual who is not a relative of the qualified caregiver or the qualifying senior family member. “Qualified care expenses” shall include, but shall not be limited to, expenses paid or incurred by a qualified caregiver for the purchase, lease, or rental of home health agency services, adult day care, companionship services, personal care attendant services, homemaker services, respite care, health care equipment and supplies, home modification services, services necessary to provide care and support to a qualifying senior family member in connection with two or more daily living activities, or assistive devices. “Qualified care expenses” shall not include expenses paid or incurred by a qualified caregiver that are reimbursed by insurance or by a program administered by the State or federal government.

“Qualified caregiver” means a resident taxpayer or a resident individual of this State who provides care and support to a qualifying senior family member.

“Qualifying senior family member” means an individual who:

is 60 years of age or older and a relative of the qualified caregiver, or is 50 years of age or older, is a relative of the qualifying caregiver, and qualifies for Social Security Disability Benefits Insurance; and

has gross income for the taxable year not in excess of the New Jersey Elder Index, as reported by the Department of Human Services pursuant to P.L.2015, c.53 (C.44:15-1 et seq.) for the most recent calendar year.

"Relative" means an individual related by consanguinity, an individual related to a spouse or a partner to a civil union or domestic partnership within the third degree as so determined, an individual in an adoptive relationship within the third degree, or an individual whose close association with another individual is the equivalent of a family relationship.

2. This act shall take effect immediately and apply to taxable years beginning on or after January 1 next following the date of enactment.

STATEMENT

This bill, designated as the Caregiver’s Assistance Act, provides a gross income tax credit to qualified caregivers, including resident taxpayers and resident individuals, who pay or incur qualified care expenses for the care and support of a qualifying senior family member.

The maximum allowable gross income to qualify for a credit under the bill will be $100,000 in the case of taxpayers filing a joint return and $50,000 for taxpayers filing separately or an individual tax return. The amount of the credit will be equal to 22.5 percent of up to $3,000 in qualified care expenses paid or incurred by the qualified caregiver during the taxable year, or a maximum of $675 per year.

The bill provides that, if multiple qualified caregivers are allowed a credit for qualified care expenses of the same qualifying senior family member, the credit allowed will be allocated in equal amounts unless a different allocation is established by agreement. The bill provides that the credit is in addition to the benefit of the dependent deduction that may be received by the qualified caregiver for claiming the qualifying senior family member as a dependent on the caregiver’s gross income tax return.

The bill provides that the credit is refundable, such that, the amount of any credit that reduces the qualified caregiver’s tax liability to an amount less than zero will be refunded to the caregiver as an overpayment of tax. The bill provides that a qualified caregiver is eligible to receive the benefits of the credit, even if the caregiver has gross income below the statutory minimum subject to tax.

The bill defines a qualifying senior family member as an individual who: 1) is 60 years of age or older and a relative of the qualified caregiver, or is 50 years of age or older, is a relative of the qualified caregiver, and qualifies for Social Security Disability Insurance, and 2) has gross income for the taxable year not in excess of the New Jersey Elder Index, as reported by the Department of Human Services pursuant to P.L.2015, c.53 (C.44:15-1 et seq.) for the most recent calendar year.

The bill generally defines qualified care expenses as the expenses paid or incurred during the taxable year for the purchase, lease, or rental of tangible personal property and services that are necessary to allow the qualifying senior family member to be maintained within or at the qualified caregiver’s or the qualifying senior family member’s permanent place of abode in this State.