New Jersey Governor Seeks Bill to Halt Impact of Federal Tax Law on Homeowners - NBC New York

New Jersey Governor Seeks Bill to Halt Impact of Federal Tax Law on Homeowners

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    New Jersey Governor Seeks Bill to Halt Impact of Federal Tax Law on Homeowners
    AP
    New Jersey Gov. Phil Murphy speaks during a news conference in Newark, N.J., Monday, Nov. 13, 2017. Murphy was with Democratic congressman from New Jersey to voice their opposition to the tax reforms being pushed by the Trump administration. On Thursday, Murphy asked lawmakers to send him legislation ensuring residents can pay property taxes as charitable contributions to skirt the federal tax overhaul. (AP Photo/Seth Wenig)

    What to Know

    • New Jersey Gov. Phil Murphy asked lawmakers to send him legislation ensuring residents can pay property taxes as charitable contributions

    • Murphy said he wants to dull what he expects will be a painful effect on New Jersey taxpayers under the new Republican-led federal tax plan

    • NJ has the highest property taxes in the country, which is a problem since the law caps local tax deductions on federal returns at $10,000

    New Jersey Gov. Phil Murphy asked lawmakers Thursday to send him a bill ensuring residents can pay property taxes as charitable contributions to skirt the federal tax overhaul.

    Murphy said he wants to dull what he expects will be a painful effect on New Jersey taxpayers under the new $1.5 trillion Republican-led federal tax plan.

    He renewed his pledge to preserve tax deductions on Friday, when he called upon mayors to take the necessary steps to counteract the impact of the federal tax legislation that stripped New Jersey’s State and Local Tax (SALT) deduction and limited the amount of money homeowners can deduct from their property taxes.

    The new law caps local tax deductions on federal returns at $10,000.

    That's an issue because New Jersey has the highest property taxes in the country.

    Murphy is seeking for property taxes to be paid as charitable contributions, which can still be deducted on federal returns.

    “When the disastrous federal tax legislation passed, I committed to pushing back and taking steps to ensure that the people of New Jersey are not subjected to unfair double taxation,” Murphy said in a statement.

    If the charitable contributions initiative is implemented, taxpayers can make donations to funds that pay for local services like schools, law enforcement and infrastructure. If residents make a donation, they will receive an offsetting tax credit on their property tax bill and the contributions will be deductible for federal tax purposes under existing law, according to Murphy.

    Marlboro, Ocean Township, Manasquan, Belmar and Aberdeen mayors joined Murphy Friday and pledged to introduce the plan to their municipalities.

    Earlier this year, three towns in northern New Jersey said they would set up charitable funds for residents to pay property taxes in support of Murphy’s initiative.

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