New Jersey 2022-2023 Regular Session

New Jersey Assembly Bill A314

Introduced
1/11/22  

Caption

Excludes military compensation of military personnel serving outside of this State from gross income tax.

Impact

If enacted, the bill would have a significant impact on state tax law, particularly regarding how military personnel's income is treated for tax purposes. The proposed changes would amend N.J.S.54A:6-7 to clearly outline exemptions for certain types of compensation received by military members. This would mean that New Jersey residents serving in the armed forces outside the state would not be required to include this income in their taxable income calculations, effectively lowering their tax burden.

Summary

Assembly Bill A314, known as the Military Compensation Tax Exemption Act, seeks to amend the New Jersey gross income tax laws by excluding the compensation of military personnel who are serving outside of the state from being taxed. This legislative change aims to provide financial relief to servicemen and women who are domiciled in New Jersey but are stationed away from their home state as part of their military duties. The bill specifically looks to exclude not only basic compensation but also related income such as housing allowances and mustering-out payments.

Contention

While the bill appears to offer benefits to military personnel, discussions around its implications may arise. Advocates for the bill argue that it is a necessary recognition of the sacrifices made by military personnel and serves to ease their financial burdens while they are away from home. However, opponents might raise concerns over the potential loss of tax revenue for the state, as exemptions could strain public resources. Additionally, there could be debates on whether such exemptions create inequalities between those serving in the military and other taxpayers.

Next_steps

Following its introduction, the bill is pending a technical review by the Legislative Counsel, indicating that further scrutiny and discussion will be necessary before it can advance. Stakeholders from various sectors, including veterans' organizations and tax policy analysts, will likely be involved in the discussions to ensure that the bill serves its intended purpose without unintended consequences.

Companion Bills

NJ S2686

Same As Excludes military compensation of military personnel serving outside of this State from gross income tax.

Previously Filed As

NJ A2703

Excludes military compensation of military personnel serving outside of this State from gross income tax.

NJ S2686

Excludes military compensation of military personnel serving outside of this State from gross income tax.

NJ S627

Excludes military compensation of military personnel serving outside of this State from gross income tax.

NJ A5073

Provides gross income tax exclusion for military compensation paid to State residents for out-of-State military service.

NJ S3975

Provides gross income tax exclusion for military compensation paid to State residents for out-of-State military service.

NJ A4349

Excludes from New Jersey gross income tax income of certain related survivors of members of United States military who die in active duty.

NJ A4198

Excludes basic pay received for active duty military service from gross income taxation.

NJ A120

Excludes bonuses for reenlistment or voluntary extension of enlistment in armed forces from gross income.

NJ A260

Excludes bonuses for reenlistment or voluntary extension of enlistment in armed forces from gross income.

NJ S872

Excludes bonuses for reenlistment or voluntary extension of enlistment in armed forces from gross income.

Similar Bills

No similar bills found.