Tax Lawyers in New Jersey

In New Jersey, individuals pay a graduated state income tax, meaning the tax rate increases with income, ranging from a low of 1.4% to a high of 10.75% across various income brackets and filing statuses. For the 2025 tax year, New Jersey has a standard deduction of $1,000 for single filers and $2,000 for those married filing jointly. Certain items like unemployment compensation and Social Security benefits are exempt.

For businesses, New Jersey levies a Corporation Business Tax (CBT), which functions as a franchise tax. The tax rate for C corporations varies based on their net income, with rates of 6.5%, 7.5%, and 9%. Additionally, there’s a minimum tax based on a company’s gross receipts. S corporations and other pass-through entities might also be subject to the Pass-Through Business Alternative Income Tax (BAIT).

The state has a sale and use tax set at a rate of 6.625% statewide. Unlike some states, there are generally no additional local sales taxes, with a few specific exceptions like in Cumberland County (8.625%).

As of early 2025, New Jersey’s average effective property tax rate was approximately 2.23% of a property’s assessed value (around $2,230 annually per $100,000 of value), contributing to its reputation for having some of the highest property tax rates in the United States. The state imposes an inheritance tax (rates ranging from 11% to 16% applicable to beneficiaries who are not close relatives,)and no longer has an estate tax.

The New Jersey Division of Taxation is the primary agency responsible for administering and collecting state-level taxes such as income tax, sales tax, and the CBT. Local property taxes are managed by individual municipalities.

In New Jersey, income is taxed through a graduated Gross Income Tax system (1.4% to 10.75%). This means that different portions of your taxable income are subject to different tax rates. For the 2025 tax year, single filers have a standard deduction of $1,000, while those married filing jointly get $2,000.

New Jersey taxes various forms of income, including wages, salaries, tips, fees, commissions, bonuses, interest, dividends, and net profits from businesses, while certain items like Social Security benefits and unemployment compensation are exempt.

Here are the rates for Single Filers for the 2025 tax year:

Taxable Income                 Tax Rate

Over $1,000,000                      10.75%

$0 to $20,000                            1.4%

$20,001 to $35,000                 1.75%

$35,001 to $40,000                   3.5%

$40,001 to $75,000                  5.525%

$75,001 to $500,000                6.37%

$500,001 to $1,000,000          8.97%

New Jersey imposes a state income tax, but several types of income are exempt at the state level:

• Social Security Benefits: These are not taxed by New Jersey. Unemployment Compensation: Benefits received from these programs are exempt.
• Railroad Retirement Benefits: Tier 1 and Tier 2 benefits are not taxed.
• Certain Disability Benefits: Payments for personal injuries or sickness, workers’ compensation, and certain permanent disability payments are excluded.
• Military Pensions and Survivor’s Benefits: Payments for service in the U.S. Armed Forces are exempt.
• Interest on U.S. Government Obligations: Interest from U.S. bonds is not taxed.
• Certain Pension, Annuity, and IRA Withdrawals:  Subject to age and income limits, some of these may be exempt.

While New Jersey exempts these incomes, federal taxes still apply

Yes, New Jersey offers several tax exemptions at the state level:

• Retirement Income Exclusion: Seniors/disabled with income under $150k can exclude some pension/IRA income (max $100k joint, less for others).
• Social Security & Certain Retirement Benefits: Social Security and Tier 1 & 2 Railroad Retirement are NJ income tax exempt.
• Property Tax Relief: Deductions for seniors/disabled/surviving spouses ($250); full exemption for 100% disabled veterans/survivors.
• Sales Tax Exemptions: Most groceries, clothing, prescription/non-prescription drugs, paper/medical supplies, and some home energies are exempt.
• Inheritance & Estate Tax: Class A beneficiaries (spouses, domestic partners, civil union partners, parents, grandparents, children, stepchildren, adopted children and their issue) are exempt from the New Jersey inheritance tax. New Jersey has no state estate tax.
• Other Exemptions: U.S. bond interest, certain disability payments, gifts/inheritances (for income tax), and unemployment compensation are NJ income tax exempt.

These exemptions help reduce overall tax burdens for residents and businesses.

State Income Tax: New Jersey imposes a graduated state income tax with rates ranging from 1.4% to 10.75% on taxable income, depending on your income level and filing status.

You can file your state income tax using:

• NJ Online Filing: The New Jersey Division of Taxation offers a free online portal for residents to file their current year NJ-1040 return directly with the state.
• Approved E-File Providers: Taxpayers can use authorized third-party tax preparation software (online or desktop) that supports New Jersey e-filing.
• Paper Filing: You can download and print the necessary forms (primarily Form NJ-1040 for residents and NJ-1040NR for non-residents) from the New Jersey Division of Taxation website and mail them in.

Federal Income Tax Filing: You can file your federal income tax in New Jersey using:

• IRS Direct File: As of the 2025 tax season, eligible New Jersey residents can use the IRS Direct File service to prepare and file their federal tax returns online directly with the IRS for free. Eligibility depends on specific criteria.
• Use IRS Form 1040 for personal federal taxes.
• File online through the IRS Free File program, commercially available tax software, or with a tax professional.

Property Tax: Administered and collected at the local (municipal and county) level. Payments are typically made to the municipal tax collector.

Other State Taxes: Businesses may need to file the Corporation Business Tax (CBT) online through the state’s online portal or approved software. Sales and Use Tax is generally collected by businesses and remitted to the New Jersey Division of Taxation.

New Jersey tax lawyer cost depend on the nature of your tax case such as: state audits, IRS litigation, or corporate tax structuring. Fees may range from hourly rates to contingency-based billing.

At Taxlawyer.com, we help New Jersey residents find reputable New Jersey tax attorneys offering strategic legal counsel without unnecessary expenses.

New Jersey’s complex tax regulations ranging from state audits to international tax compliance demand an experienced New Jersey tax attorney. Follow these steps to efficiently hire a tax lawyer in New Jersey:

• Identify your tax matter:  IRS audits, business tax disputes, foreign asset disclosures, or criminal tax defense.
• Research attorney credentials: Ensure experience in federal, state and local tax litigation.
• Book a case review: Discuss possible tax strategies and legal remedies.
• Understand the fee structure: Compare hourly rates, retainers, and flat-fee services.

At TaxLawyer.com, we connect New Jersey taxpayers with top-rated New Jersey tax attorneys for expert legal assistance.

New Jersey’s tax laws include state income tax, sales tax, and property tax, making compliance essential for residents and businesses. Here’s a concise overview of New Jersey’s key tax rules and how they may impact you:

• Graduated Income Tax: New Jersey has a progressive income tax (1.4%-10.75%) based on income and filing status.
• Retirement Exemption: Social Security and unemployment benefits are exempt. Some pensions/IRAs are exempt for seniors/disabled with lower incomes.
• Sales Tax: The state sales tax rate is 6.625%. There are generally no additional local sales taxes, with the exception of Cumberland County which has a higher rate of 8.625%. Most groceries, clothes, and medications are exempt.
• Property Tax: New Jersey consistently ranks among the highest in the U.S. for property taxes, which are set at the local (municipal and county) level. Relief programs exist for seniors, disabled individuals, and veterans.  
• Business Tax: Corporations pay 6.5% – 9% based on income, plus minimums. Pass-through entities can elect an alternative tax (5.675%-10.9%).
• Inheritance & Estate Tax: New Jersey imposes an inheritance tax with rates from 11% to 16% for beneficiaries who are not close relatives (Class A). There is no estate tax in New Jersey, having been repealed in 2018.
• Fuel & Tobacco Tax: New Jersey’s gasoline tax is 34.4 cents per gallon and the cigarette excise tax rate is $2.70 per pack.  

Overall, New Jersey’s tax system features income, sales, and notably high property taxes, creating a complex environment that requires careful planning for both individuals and businesses.