TRENTON – Legislation Senate President Stephen M. Sweeney and Senators Fred Madden and Linda R. Greenstein sponsored to provide New Jersey’s middle-class senior citizens and retirees with an income tax cut, allowing them to remain in New Jersey amidst the tide of rising property taxes, was today passed by the Legislature and sent to the Governor’s desk.
“Instead of simply giving the rich all the tax cuts in the hopes it will trickle down, we should be allowing seniors and retirees to keep money in their pockets so they can afford to stay in New Jersey,” said Sweeney (D-Gloucester/Cumberland/Salem). “We need to be allowing retirees to stay here for the long-term instead of taking their retirement savings elsewhere. It’s a smart move that will help small businesses and downtown New Jersey.”
Under the bill (S-2345), seniors whose total earnings fall under $100,000 would be exempt from paying taxes on any income from a pension or deferred compensation plan. The change would put New Jersey on par with Pennsylvania, which is one of only two other states (Illinois and Mississippi) to have a similar retirement income tax exemption.
The lawmakers contrasted their proposal to statements previously made by the Governor, who has said his goal was to cut income taxes for the highest-paid residents by one-third – an idea floated under the guise of putting New Jersey on the same footing tax-wise as Pennsylvania.
“Or first priority should be helping New Jersey’s middle-class retirees stay in their hometowns, not pushing them out to make way for the rich,” said Madden (D-Gloucester/Camden). “If the Governor is looking across the Delaware River for tax ideas, a retiree tax exemption is far better, and would go more good, than just making the state more attractive to millionaires.”
“Retirees are more likely to invest their spending money in local stores and restaurants, keeping their money close-to-home and helping small businesses,” said Greenstein (D-Middlesex/Mercer). “Instead of driving seniors away, we should be doing everything possible to keep them here so they can play a role in the revitalization of their hometowns and the stabilization of their local economies.”
The bill passed the Senate 39-0; the Assembly approved it 65-3 with eight abstentions.