Fund allows residents to purchase discounted tax credits
Trenton – In an effort to help state government recover from the economic crisis caused by the pandemic, legislation to establish the “COVID-19 Economic Recovery Fund” was introduced into the Senate today. The fund would allow taxpayers to purchase discounted tax credits from the New Jersey Department of the Treasury. It would also appropriate funding to various New Jersey government departments to support vital programs and services. The bill is sponsored by Senator Troy Singleton.
“We are currently experiencing a Depression-level economic crisis due to the COVID-19 pandemic. This financial crisis calls for a massive call to action by the state government – one that will take new approaches and bold ideas to meet this challenge,” said Senator Singleton (D-Burlington). “This mutually beneficial recovery fund will allow people to purchase discounted tax credits, while providing government the money it needs to stimulate the economy through investments in the workforce, infrastructure, education, economic development and more.”
The Department of the Treasury would allow taxpayers to purchase discounted tax credits for the next fiscal year and up to five years after. However, a taxpayer may not purchase enough credits to reduce their tax liability to less than zero. The cost to purchase a tax credit is as follows:
- 97% of the credit purchased for tax year 2022
- 94% of the credit purchased for tax year 2023
- 91% of the credit purchased for tax year 2024
- 88% of the credit purchased for tax year 2025
- 85% of the credit purchased for tax year 2026
Once $5 billion has been deposited into the fund, the Department of the Treasury would then appropriate funding to the following departments: New Jersey Economic Development Authority, the Department of Education, the Department of Health, the Department of Human Services, the Department of Community Affairs, the Department of Labor of Workforce Development, and the Department of Transportation.
This appropriation would be aimed at stimulating the state economy through funding for small businesses and non-profits, community health and nutritional assistance programs, schools with budget deficits, medical assistance or social service programs, worker protections, and infrastructure projects.