Both chambers of the New Jersey legislature are considering legislation that would exclude 403(b) and 457(b) deferrals from New Jersey state income tax.
In the Assembly, A4112 was introduced by Assemblyman Ronald Dancer (R-Cream Ridge) on May 7. It was referred to the Assembly Appropriations Committee. On Feb. 13, S1410 was introduced by two Senators—Deputy Whip Christopher “Kip” Baterman (R-Somerville) and Anthony Bucco (R-Denville)— in their chamber. It is now before the Senate Budget and Appropriations Committee.
New Jersey’s gross income tax currently does not exclude contributions to 403(b)s but does exclude the contributions by employees of private, for-profit businesses to 401(k)s; the bills, which are identical, would exclude contributions to 403(b)s. The legislation would give the employees of federally tax-exempt charitable organizations and employees of public school systems, as well as tax-exempt charitable organizations, hospitals, churches, social welfare organizations and educational institutions in New Jersey the same tax incentives to save for retirement that employees of for-profit businesses have.
New Jersey’s gross income tax currently does not exclude contributions to 403(b)s but does exclude the contributions by employees of private, for-profit businesses to 401(k)s; the bills, which are identical, would exclude contributions to 403(b)s. The legislation would give the employees of federally tax-exempt charitable organizations and employees of public school systems, as well as tax-exempt charitable organizations, hospitals, churches, social welfare organizations and educational institutions in New Jersey the same tax incentives to save for retirement that employees of for-profit businesses have.
A4112 was referred to the Assembly Appropriations Committee; S1410 is now before the Senate Budget and Appropriations Committee.
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