Increases age of dependent for whom gross income tax exemption for higher education expenses may be claimed from under 22 years to under 27 years.
The proposed change will enable taxpayers to claim a gross income tax deduction of $1,000 for each qualified dependent attending an accredited institution of higher education on a full-time basis. This adjustment, which updates age limits that have not changed since 1976, aims to reflect contemporary educational trends and the financial burdens faced by families. As a result, more families may be eligible for tax relief, potentially reducing their overall financial burden while encouraging higher education enrollment.
Senate Bill 2763, introduced in June 2022, proposes an amendment to New Jersey's gross income tax policy by increasing the age eligible for a dependent exemption for higher education expenses from under 22 to under 27 years. This move aims to provide greater financial relief to families supporting students in post-secondary education. It acknowledges the extended duration of education and the increasing ages at which dependents often transition to adulthood, given the complexities of modern academic paths.
While this bill has garnered support from various legislators, the implications of such tax adjustments may generate discussions on budget allocations and state revenue. Critics may voice concerns about the potential impact on state funding for educational institutions or other public services, while supporters argue that the bill aids in easing the financial strain on families seeking to provide higher education opportunities for their dependents.