A10 —

       Not over $20,000.00..........            1.700% of taxable income        Over $20,000.00 but not             over $35,000.00.......

            $340.00 plus 2.125% of the                                                                      excess over $20,000.00        Over $35,000.00 but not             over $40,000.00..........            $658.75 plus 4.250% of the                                                                      excess over $35,000.00      Over $40,000.00 but not              over $75,000.00.......

           $871.25 plus 6.013% of the                                                                      excess over $40,000.00        Over $75,000.00 ..........                $2,975.80 plus 6.580% of the                                                                      excess over $75,000.00        (4)   for taxable years beginning on or after January 1, 1996 but before January 1, 2004:

       If the taxable income is:              The tax is:

       Not over $20,000.00..........            1.400% of taxable income        Over $20,000.00 but not              over $35,000.00........             $280.00 plus 1.750% of the                                                                      excess over $20,000.00        Over $35,000.00 but not              over $40,000.00........             $542.50 plus 3.500% of the                                                                      excess over $35,000.00        Over $40,000.00 but not              over $75,000.00........             $717.50 plus 5.525% of the                                                                      excess over $40,000.00        Over $75,000.00............                $2,651.25 plus 6.370% of the                                                                      excess over $75,000.00        (5)   for taxable years beginning on or after January 1, 2004 but before January 1, 2018:

       If the taxable income is:               The tax is:

       Not over $20,000.00..........            1.400% of taxable income        Over $20,000.00 but not              over $35,000.00........

          $280.00 plus 1.750% of the                                                                      excess over $20,000.00        Over $35,000.00 but not              over $40,000.00........

          $542.50 plus 3.500% of the                                                                                                                             excess over $35,000.00        Over $40,000.00 but not              over $75,000.00.......

          $2,651.25 plus 6.370% of the                                                                      excess over $75,000.00        Over $500,000.00 ............            $29,723.75 plus 8.970% of the                                                                                                                             excess over $500,000.00        (6)   for taxable years beginning on or after January 1, 2018, but before January 1, 2020:

       If the taxable income is:              The tax is:

       Not over $20,000.00..........            1.400% of taxable income        Over $20,000.00 but not              over $35,000.00........             $280.00 plus 1.750% of the                                                                      excess over $20,000.00        Over $35,000.00 but not              over $40,000.00........             $542.50 plus 3.500% of the                                                                      excess over $35,000.00        Over $40,000.00 but not              over $75,000.00........             $717.50 plus 5.525% of the                                                          excess over $40,000.00        Over $75,000.00 but not              over $500,000.00......             $2,651.25 plus 6.370% of the                                                                                                                             excess over $75,000.00        Over $500,000.00 but not              over $5,000,000.00...             $29,723.75 plus 8.970% of the                                                                      excess over $500,000.00        Over $5,000,000.00 ..........           $433,373.75 plus 10.75% of the                                                                      excess over $5,000,000.00       (7)(7)   for taxable years beginning on or after January 1, 2020:

       If the taxable income is:               The tax is:

       Not over $20,000.00……             1.400% of taxable income        Over $20,000.00 but not                        over $35,000.00…….  $35,000.00…….                    $280.00 plus 1.750% of the                                                             excess over $20,000.00        Over $35,000.00 but not                        over $40,000.00…… $40,000.00……                       $542.50 plus 3.500% of the                                                             excess over $35,000.00        Over $40,000.00 but not                        over $75,000.00……             $717.50 plus 5.525% of the                                                             excess over $40,000.00        Over $75,000.00 but not             over $500,000.00…               $2,651.25 plus 6.370% of the                                                             excess over $75,000.00        Over $500,000.00 but not             over $1,000,000.00..  $1,000,000.00..                           $29,723.75 plus 8.970% of the                                                             excess over $500,000.00        Over $1,000,000.00….           $1,000,000.00….                        $74,573.75 plus 10.750% of the                                                             excess over $1,000,000.00      c.     For the purposes of this section, an individual who would be eligible to file as a head of household for federal income tax purposes but for the fact that such taxpayer is a nonresident alien, shall determine tax pursuant to subsection a.

(cf:       2.

P.L.2018, a. c.45, s.10)      2.

 (New section)  a.

     b.b.    For taxable year 2020, no additions to tax or penalty shall be imposed upon a taxpayer pursuant to N.J.S.54A:9-6 for underpayment of increased estimated tax on taxable income received before November 1, 2020 for which the increased estimated tax due is attributable to the rate imposed on gross income in excess of $1,000,000, but not in excess of $5,000,000.

 For     c.     For taxable year 2020, no additionsinterest, topenalties, tax or penaltyother costs shall be imposed upon aan taxpayeremployer pursuantmaintaining toan N.J.S.54A:9-6office foror underpaymenttransacting business within this State and making payment of increasedany estimatedsalaries, taxwages, onand taxableremuneration incomesubject receivedto beforethe November“New 1,Jersey 2020Gross Income Tax Act,” N.J.S.54A:1-1 et seq., or making payment of any remuneration for whichemployment subject to contribution under the increasedNew estimatedJersey tax“unemployment duecompensation law,” pursuant to R.S.43:21-1 et seq., for insufficient withholding of salaries, wages, and other remuneration paid before November 1, 2020 that is attributable to an increase in the rate imposed on gross income in excess of $1,000,000, but not in excess of $5,000,000.

      c. C.54A:9-30  ForEligibility taxable year 2020, no interest, penalties, or other costs shall be imposed upon an employer maintaining an office or transacting business within this State and making payment of any salaries, wages, and remuneration subject to the “New Jersey Gross Income Tax Act,” N.J.S.54A:1-1 et seq., or making payment of any remuneration for employmenttax subjectrebate. to contribution under the New Jersey “unemployment compensation law,” pursuant to R.S.43:21-1 et seq., for insufficient withholding of salaries, wages, and other remuneration paid before November 1, 2020 that is attributable to an increase in the rate imposed on gross income in excess of $1,000,000, but not in excess of $5,000,000.

       3.

 (New section)  a.

    f.    f.     Any rebate issued pursuant to this section shall not be considered gross income for purposes of the New Jersey Gross Income Tax Act.

     g.    As used in this section          section:               “Qualified taxpayer” means an individual who has timely filed a resident return, is a resident of this State during the taxable year, and who had during the taxable year:

      1.   C.54A:9-8.1  a. Setoff Whenever any taxpayer or resident shall be entitled to any refund of taxesindebtedness pursuant to the "New Jersey Gross Income Tax Act" (N.J.S.54A:1-1 et seq.), including an earned income tax credit provided as a refund pursuant to P.L.2000, c.80 (C.54A:4-6 et al.), or whenever any individual is eligible to receive a rebate pursuant to section 3 of P.L.    , c.   (C.        ) (pending before the Legislature as this bill), or a homestead rebate or credit pursuant to P.L.1990, c.61 (C.54:4-8.57 et al.), P.L.1999, c.63 (C.54:4-8.58a et al.), P.L.2004, c.40 or P.L.2007, c.62 (C.18A:7F-37 et al.), and if the rebate or credit is not required to be paid over to the municipal tax collector under the provisions of section 8 of P.L.1990, c.61 (C.54:4-8.64), and at the same time the taxpayer or resident shall be indebted to any agency or institution of State Government,agencies; to the Victims of Crime Compensation Board for the portion of an assessment ordered pursuant to section 2 of P.L.1979, c.396 (2C:43-3.1) for deposit in the Victims of Crime Compensation Board Account or restitution ordered to be paid to the board pursuant to N.J.S.2C:44-2 for deposit in the Victims of Crime Compensation Board Account, or for child support under Title IV-A, Title IV-D, or Title IV-E of the federal Social Security Act (42 U.S.C.

precedence of child support indebtedness.

     1.

 a.  Whenever any taxpayer or resident shall be entitled to any refund of taxes pursuant to the "New Jersey Gross Income Tax Act" (N.J.S.54A:1-1 et seq.), including an earned income tax credit provided as a refund pursuant to P.L.2000, c.80 (C.54A:4-6 et al.), or whenever any individual is eligible to receive a rebate pursuant to section 3 of P.L.2020, c.94 (C.54A:9-30), or a homestead rebate or credit pursuant to P.L.1990, c.61 (C.54:4-8.57 et al.), P.L.1999, c.63 (C.54:4-8.58a et al.), P.L.2004, c.40 or P.L.2007, c.62 (C.18A:7F-37 et al.), and if the rebate or credit is not required to be paid over to the municipal tax collector under the provisions of section 8 of P.L.1990, c.61 (C.54:4-8.64), and at the same time the taxpayer or resident shall be indebted to any agency or institution of State Government, to the Victims of Crime Compensation Board for the portion of an assessment ordered pursuant to section 2 of P.L.1979, c.396 (C.2C:43-3.1) for deposit in the Victims of Crime Compensation Board Account or restitution ordered to be paid to the board pursuant to N.J.S.2C:44-2 for deposit in the Victims of Crime Compensation Board Account, or for child support under Title IV-A, Title IV-D, or Title IV-E of the federal Social Security Act (42 U.S.C.

(cf:       5.    This act shall take effect immediately and sections 1 and 2 shall apply retroactively to taxable years beginning on and after January 1, 2020.

P.L.2007, c.62, s.38)        5.   Approved ThisSeptember act29, shall take effect immediately and sections 1 and 2 shall apply retroactively to taxable years beginning on and after January 1, 2020.

    STATEMENT        This bill increases the gross income tax rate applicable to taxpayers with gross income exceeding $1,000,000 in taxable years beginning on or after January 1, 2020.

     The gross income tax rate under current law is 8.97 percent for income between $1,000,000 and $5,000,000, and 10.75 percent for income over $5,000,000.

This bill applies the 10.75 percent rate to gross income exceeding $1,000,000.

     The bill also provides to eligible gross income taxpayers a tax rebate of either $500 or, if the taxpayer paid less than that for the tax year, the amount of actual tax paid.

The rebate is subject to annual appropriation by the Legislature.

     To be eligible for the rebate the taxpayer must be a resident of the State, have at least one dependent child, have a gross income tax liability greater than zero, and have gross income not exceeding:

     $150,000 if (1) married and filing jointly, (2) filing as a head of household, or (3) filing as a surviving spouse;

or      $75,000 if (1) married and filing separately, or (2) individuals filing as a single taxpayer.

     The director of the Division of Taxation will issue rebates to eligible taxpayers between July 1 and July 31, or between July 1 and the end of the year for taxpayers who were granted gross income tax return extensions.

                                            Increases gross income tax rate from 8.97 percent to 10.75 percent on income between $1,000,000 and $5,000,000, and provides up to $500 tax rebate to eligible taxpayers.