New Jersey Tax Changes - October 2024
Week Of 10.07.2024
The New Jersey Superior Court, Appellate Division, has upheld a $17,000 award of attorney's fees and costs to a prevailing party in a frivolous litigation case.
The court found that the Frivolous Litigation Act governs sanctions for frivolous litigation against a party. The New Jersey Department of the Treasury is encouraging seniors and disabled New Jerseyans to check their eligibility for the property tax reimbursement initiative and apply before the October 31, 2024 deadline. To be eligible, residents must be 65 years or older or disabled on December 31, 2022, have owned and lived in their residence since December 31, 2019, and have paid property taxes or mobile home site fees on time in 2022 and 2023.
The U.S. Supreme Court has denied a request to review whether New Jersey's requirement that only an attorney can represent a taxpayer in New Jersey Tax Court on an estate tax appeal was constitutional.
The New Jersey Tax Court has ruled that a small pizzeria produced sufficient records for an auditor to compute its tax liabilities for sales and use tax and corporate business taxes. The court rejected an estimated assessment because the business was sold in January 2014, and the Division could not use figures from September 2014 to compute the estimated assessment. The Division of Taxation is reminding New Jersey residents that they may be eligible for a refundable Gross Income Tax credit if they work for an out-of-state employer and successfully challenge the taxing of income earned while working remotely in New Jersey. The credit is applicable to tax years 2020 to 2023.
Week Of 09.30.2024
The New Jersey Division of Taxation has partnered with ID.me to verify the identities of taxpayers applying for the NJ ANCHOR benefit online.
ID.me will verify your identity by obtaining a photo of your government-issued ID, such as a passport or driver's license, and comparing it to a live picture of you.
If you cannot use the ID.me software, you can either meet online with an ID.me employee or locate a UPS location in New Jersey that is partnering with ID.me to offer in-person support.
Additionally, New Jersey has passed legislation that exempts sales of qualifying investment metal bullion and investment coins beginning on January 1, 2025.
Investment metal bullion means any elementary precious metal that has been put through a process of smelting or refining, including gold, silver, platinum, and palladium.
Investment coin means any numismatic coin manufactured of gold, silver, platinum, palladium, or any other metal, including non-precious metals, and having a fair market value of not less than $1,000.
To be exempt, the individual coin must have a fair market value of not less than $1,000.
Investment coin does not include jewelry or works of art made of coins, nor does it include commemorative medallions.
The New Jersey Division of Taxation has clarified that the delivery date of a zero-emission vehicle
(ZEV) determines whether the sales tax exemption applies, not the order date. This means that if you purchase a ZEV before October 1, 2024, but take delivery after that date, you will be subject to the new sales tax rate. The exemption phase-out began on October 1, 2024, with a 3.3125% sales tax rate on ZEV purchases.
Week Of 10.07.2024
New Jersey Estate & Gift Taxes—U.S. Supreme Court action petition for certiorari denied in New Jersey case.
The U.S. Supreme Court has denied a request to review whether the state's requirement that only an attorney can represent a taxpayer in New Jersey Tax Court on an estate tax appeal was constitutional. (Tony Ping Yew v. Matthew J. Platkin, Attorney General of New Jersey et al., U.S. Ct. App., 3rd Cir., Dkt. No. 23-3005, 03/21/2024; cert. denied, U.S. S. Ct., Dkt. No. 24-65, 10/07/2024.)
New Jersey General Administrative Provisions—New Jersey court agrees taxpayer provided sufficient records for audit.
The New Jersey Tax Court has rejected an estimated assessment of a small pizzeria and ruled that the pizzeria produced sufficient records for an auditor to compute its tax liabilities for sales and use tax and corporate business taxes. The court stated that since the business was sold in January 2014, the Division could not use figures from September 2014 to compute the estimated assessment. The court also found that the Division had provided no support for the estimated assessment. The court accepted an expert's testimony for the taxpayer based on the taxpayer's purchases during the period. (La Troncal Food Corp. and Vicente Intriago v. Division of Taxation, N.J. Tax Ct., Dkt. No. 013472-2017, 10/02/2024.)
New Jersey Personal Income Tax—New Jersey discusses credit for challenges to convenience rules.
The Division of Taxation is reminding New Jersey residents that they may be eligible for a refundable Gross Income Tax credit if they work for an out-of-state employer and successfully challenge the taxing of income earned while working remotely in New Jersey. The credit is applicable to tax years 2020 to 2023. To qualify, a taxpayer must: (1) be a New Jersey resident; (2) pay income or wage tax to another state; (3) be denied a refund on income earned while working remotely from home in NJ; (4) appeal the other state's assessment in an out-of-state tax court or tribunal; (5) obtain a favorable final judgment from the court or tribunal; and (6) receive a refund from the other state. The final judgment in the taxpayer's favor from the other state's tax court or tribunal must satisfy the other state's laws for establishing finality. The Division notes that to date, one taxpayer successfully sued New York and received a refund of over $7,000 from New Jersey based on this credit. (New Jerseyans Working Remotely for Out-of-State Employers May Be Eligible for Gross Income Tax Credit, 10/08/2024.)
New Jersey Property Tax—New Jersey court awards damages to victim of frivolous tax litigation.
The New Jersey Superior Court, Appellate Division, has rejected a third-party intervenor's appeal of attorney's fees and costs of almost $17,000 that were awarded when the third-party intervenor's claim was found to be frivolous. The court found that the Frivolous Litigation Act governs sanctions for frivolous litigation against a party. Under that statute, a court is permitted to award reasonable attorney's fees and litigation costs to a prevailing party in a civil action if the court finds at any time during the proceedings or upon judgment that a complaint of the non-prevailing person was frivolous. The court found that the third-party intervenor had filed numerous complaints against a farmland assessment which had been rejected previously by the courts, that his actions in pursuing further litigation merited sanctions and upheld the sanctions applied by the lower court. (Rosenblum v. Borough of Closter and Miele, N.J. Super. Ct., App. Div., Dkt. No. A-3017-22, 10/10/2024.)
New Jersey Property Tax—New Jersey encourages property owners to file for senior freeze reimbursements.
The New Jersey Department of the Treasury is encouraging seniors and disabled New Jerseyans to check their eligibility for the recently expanded property tax reimbursement initiative and apply before the October 31, 2024 deadline. Taxpayers must meet all the eligibility requirements for each year from the base year through the current application year. Eligibility must be continuous, otherwise a new base year must be established. Residents must meet the following eligibility requirements: (1) 65 years or older or disabled on December 31, 2022; (2) owned and lived in their residence since December 31, 2019 or earlier and lived in that home on December 31, 2023; (3) owned and lived in their home, or leased a site in a mobile home park since December 31, 2019 or earlier; and (4) paid property taxes or mobile home site fees on time in 2022 and 2023. (Treasury Encourages Eligible Residents to Senior Freeze Property Reimbursement Program Before 10/31 Deadline, N.J. Dept. of Treasury, 10/07/2024.)
Week Of 09.30.2024
New Jersey Property Tax—New Jersey discusses its identity verification process.
The New Jersey Division of Taxation has published a list of answers to frequently asked questions about its identity verification process. The Division has partnered with ID.me to verify the identities of taxpayers applying for the NJ ANCHOR benefit online. ID.me will verify identify by obtaining online from the applicant, a photo of the taxpayer's government identify card, for example a passport or driver's license, which it will compare to a live picture of the applicant. If the applicant cannot use the ID.me software, the applicant can either meet online with an ID.me employee to walk them through the process or locate a UPS location in New Jersey that is partnering with ID.me to offer in-person support. (Frequently Asked Questions About IDME, N.J. Div. of Taxation, 09/16/2024.)
New Jersey Sales & Use Taxes—New Jersey discusses exemption for sales of investment bullion and investment coins.
The New Jersey Division of Taxation has announced the passage of legislation that exempts sales of qualifying investment metal bullion and investment coins beginning on and after January 1, 2025. Investment metal bullion means any elementary precious metal that has been put through a process of smelting or refining, including, but not limited to: gold, silver, platinum, and palladium, and that is in such a state or condition that its value depends upon its contents and not its form. Investment coin means any numismatic coin manufactured of gold, silver, platinum, palladium, or any other metal, including non-precious metals, and having a fair market value of not less than $1,000. In order to be exempt, the individual coin must have a fair market value of not less than $1,000. Investment coin does not include jewelry or works of art made of coins, nor does it include commemorative medallions. (Exemption for Sales of Certain Investment Bullion and Investment Coins, N.J. Div. of Taxation, 10/01/2024.)
New Jersey Sales & Use Taxes—New Jersey rules delivery date determines whether ZEV exemption applies.
The New Jersey Division of Taxation (Division) has updated its list of answers to frequently asked questions about the phaseout of the zero emission vehicle (ZEV) exemption. The first stage of the phaseout begins October 1, 2024 when purchasers of ZEVs will be required to pay tax at the rate of 3.3125% on ZEV purchases. The Division advises in the FAQs that in order to take advantage of the pre-October 1, 2024 exemption, purchasers of ZEVs must take delivery of those vehicles before October 1, 2024, i.e., the order date is irrelevant for purposes of the exemption. (Zero Emission Vehicles-Frequently Asked Questions, N.J. Div., of Taxation, 09/20/2024.)
Week Of 10.07.2024
New Jersey Estate & Gift Taxes—U.S. Supreme Court action petition for certiorari denied in New Jersey case.
The U.S. Supreme Court has denied a request to review whether the state's requirement that only an attorney can represent a taxpayer in New Jersey Tax Court on an estate tax appeal was constitutional. (Tony Ping Yew v. Matthew J. Platkin, Attorney General of New Jersey et al., U.S. Ct. App., 3rd Cir., Dkt. No. 23-3005, 03/21/2024; cert. denied, U.S. S. Ct., Dkt. No. 24-65, 10/07/2024.)
New Jersey General Administrative Provisions—New Jersey court agrees taxpayer provided sufficient records for audit.
The New Jersey Tax Court has rejected an estimated assessment of a small pizzeria and ruled that the pizzeria produced sufficient records for an auditor to compute its tax liabilities for sales and use tax and corporate business taxes. The court stated that since the business was sold in January 2014, the Division could not use figures from September 2014 to compute the estimated assessment. The court also found that the Division had provided no support for the estimated assessment. The court accepted an expert's testimony for the taxpayer based on the taxpayer's purchases during the period. (La Troncal Food Corp. and Vicente Intriago v. Division of Taxation, N.J. Tax Ct., Dkt. No. 013472-2017, 10/02/2024.)
New Jersey Personal Income Tax—New Jersey discusses credit for challenges to convenience rules.
The Division of Taxation is reminding New Jersey residents that they may be eligible for a refundable Gross Income Tax credit if they work for an out-of-state employer and successfully challenge the taxing of income earned while working remotely in New Jersey. The credit is applicable to tax years 2020 to 2023. To qualify, a taxpayer must: (1) be a New Jersey resident; (2) pay income or wage tax to another state; (3) be denied a refund on income earned while working remotely from home in NJ; (4) appeal the other state's assessment in an out-of-state tax court or tribunal; (5) obtain a favorable final judgment from the court or tribunal; and (6) receive a refund from the other state. The final judgment in the taxpayer's favor from the other state's tax court or tribunal must satisfy the other state's laws for establishing finality. The Division notes that to date, one taxpayer successfully sued New York and received a refund of over $7,000 from New Jersey based on this credit. (New Jerseyans Working Remotely for Out-of-State Employers May Be Eligible for Gross Income Tax Credit, 10/08/2024.)
New Jersey Property Tax—New Jersey court awards damages to victim of frivolous tax litigation.
The New Jersey Superior Court, Appellate Division, has rejected a third-party intervenor's appeal of attorney's fees and costs of almost $17,000 that were awarded when the third-party intervenor's claim was found to be frivolous. The court found that the Frivolous Litigation Act governs sanctions for frivolous litigation against a party. Under that statute, a court is permitted to award reasonable attorney's fees and litigation costs to a prevailing party in a civil action if the court finds at any time during the proceedings or upon judgment that a complaint of the non-prevailing person was frivolous. The court found that the third-party intervenor had filed numerous complaints against a farmland assessment which had been rejected previously by the courts, that his actions in pursuing further litigation merited sanctions and upheld the sanctions applied by the lower court. (Rosenblum v. Borough of Closter and Miele, N.J. Super. Ct., App. Div., Dkt. No. A-3017-22, 10/10/2024.)
New Jersey Property Tax—New Jersey encourages property owners to file for senior freeze reimbursements.
The New Jersey Department of the Treasury is encouraging seniors and disabled New Jerseyans to check their eligibility for the recently expanded property tax reimbursement initiative and apply before the October 31, 2024 deadline. Taxpayers must meet all the eligibility requirements for each year from the base year through the current application year. Eligibility must be continuous, otherwise a new base year must be established. Residents must meet the following eligibility requirements: (1) 65 years or older or disabled on December 31, 2022; (2) owned and lived in their residence since December 31, 2019 or earlier and lived in that home on December 31, 2023; (3) owned and lived in their home, or leased a site in a mobile home park since December 31, 2019 or earlier; and (4) paid property taxes or mobile home site fees on time in 2022 and 2023. (Treasury Encourages Eligible Residents to Senior Freeze Property Reimbursement Program Before 10/31 Deadline, N.J. Dept. of Treasury, 10/07/2024.)
Week Of 09.30.2024
New Jersey Property Tax—New Jersey discusses its identity verification process.
The New Jersey Division of Taxation has published a list of answers to frequently asked questions about its identity verification process. The Division has partnered with ID.me to verify the identities of taxpayers applying for the NJ ANCHOR benefit online. ID.me will verify identify by obtaining online from the applicant, a photo of the taxpayer's government identify card, for example a passport or driver's license, which it will compare to a live picture of the applicant. If the applicant cannot use the ID.me software, the applicant can either meet online with an ID.me employee to walk them through the process or locate a UPS location in New Jersey that is partnering with ID.me to offer in-person support. (Frequently Asked Questions About IDME, N.J. Div. of Taxation, 09/16/2024.)
New Jersey Sales & Use Taxes—New Jersey discusses exemption for sales of investment bullion and investment coins.
The New Jersey Division of Taxation has announced the passage of legislation that exempts sales of qualifying investment metal bullion and investment coins beginning on and after January 1, 2025. Investment metal bullion means any elementary precious metal that has been put through a process of smelting or refining, including, but not limited to: gold, silver, platinum, and palladium, and that is in such a state or condition that its value depends upon its contents and not its form. Investment coin means any numismatic coin manufactured of gold, silver, platinum, palladium, or any other metal, including non-precious metals, and having a fair market value of not less than $1,000. In order to be exempt, the individual coin must have a fair market value of not less than $1,000. Investment coin does not include jewelry or works of art made of coins, nor does it include commemorative medallions. (Exemption for Sales of Certain Investment Bullion and Investment Coins, N.J. Div. of Taxation, 10/01/2024.)
New Jersey Sales & Use Taxes—New Jersey rules delivery date determines whether ZEV exemption applies.
The New Jersey Division of Taxation (Division) has updated its list of answers to frequently asked questions about the phaseout of the zero emission vehicle (ZEV) exemption. The first stage of the phaseout begins October 1, 2024 when purchasers of ZEVs will be required to pay tax at the rate of 3.3125% on ZEV purchases. The Division advises in the FAQs that in order to take advantage of the pre-October 1, 2024 exemption, purchasers of ZEVs must take delivery of those vehicles before October 1, 2024, i.e., the order date is irrelevant for purposes of the exemption. (Zero Emission Vehicles-Frequently Asked Questions, N.J. Div., of Taxation, 09/20/2024.)