TRENTON, N.J. – Congress is being urged in a new Assembly resolution to allow New Jersey homeowners to fully deduct their state and local taxes in their 2019 federal tax filings due July 15 because of the extraordinary impact Covid-19 is having on Garden State residents.
“New Jersey has suffered more deaths and infections than any other state except New York, and our economy is devastated. More than a quarter of our workforce is unemployment and most of our businesses remain closed. We are asking Congress to give our homeowners a break this tax season. Waive the $10,000 cap the federal Tax Cuts and Jobs Act of 2017 imposed on the amount of state and local taxes our homeowners can deduct from their federal tax bill. Allow the full deduction for the 2019 tax year as our families prepare to file their taxes on July 15,” said Assemblywoman BettyLou DeCroce, who introduced the resolution.
Homeowners were once able to deduct all of their state and local taxes from their annual federal taxes without a cap. But when the 2017 federal legislation put a $10,000 cap into effect beginning in the 2018 tax year, high cost-of-living states, such as New Jersey, where uniquely impacted. Combined state and local taxes incurred annually by many homeowners in the Garden State easily exceed $10,000.
New Jersey residents are already among the most heavily taxed in the nation and they send more money to the federal government than the state gets in return in terms of federal services. The resolution, AR163, noted that the state’s economy was already sputtering prior to the Covid-19 crisis and that residents of New Jersey need tax relief immediately.