How to Calculate a Homestead Rebate Adjustment in New Jersey

The Division of Taxation within the New Jersey Department of the Treasury is responsible for processing applications from taxpayers applying for the state's homestead tax credits. Eligible homeowners who qualify for the 2010 and 2011 Homestead Benefit Tax Credits receive a one-time property tax reduction on their 2012 property tax bills. The total tax credits that residents can receive depend on their gross incomes in 2010 and 2006 property tax assessments. The New Jersey homestead tax credits are available to limited-income elderly residents age 65 or older, limited-income residents with physical or mental disabilities and limited-income families without disabilities and who are not elderly.

Instructions

Apply for Homestead Exemption Program

1. Verify you are a New Jersey resident qualified for the homestead benefit. You must be a New Jersey resident who owns, lives in and used your home as your principal residence as of 12:01 a.m. on October 1, 2010, for the 2010 tax year benefit.

2. Locate your 2010 tax bills. Verify you paid all of your property taxes during 2010. You may not qualify for a homestead exemption if you have unpaid tax assessments.

3. Verify your annual income meets the New Jersey homestead exemption income limits. As of August 2011, the income limit for 2009 and 2010 was $150,000 for residents age 65 or older, those with permanent disabilities and blind residents. For all other residents, the income limit was $75,000.

4. Complete your 2010 Homestead Benefit Worksheet available in your New Jersey Homestead Application Packet. You may contact the Division of Taxation's toll-free number for an application packet (see Resources).

5. Calculate your homestead benefit by using the online calculation tool available on the New Jersey Division of Taxation website or you may do it without the tool by using a calculator.

Homestead Benefit Calculation for Elderly or Disabled Residents

1. Locate your 2006 property tax bills. You must be at least 65 years old or disabled on Dec. 31, 2010, to qualify for this exemption.

2. Multiply your 2006 property tax bill by 10 percent if your 2010 annual income was $100,000 or less. This is the amount of your tax rebate, which the state will apply toward your 2010 and 2011 tax bills for taxes due in 2012.

3. Multiply your 2006 property tax bill by 5 percent if your 2010 annual income was over $100,000 but less than $150,000. This is the amount of your tax rebate, which the state will apply toward your 2010 and 2011 tax bills for taxes due in 2012.

Homestead Benefit Calculation for Low-Income Residents (Non-Elderly and Non-Disabled)

1. Locate your 2006 tax bills.

2. Multiply your 2006 property tax bill by 10 percent if your 2010 annual income was $50,000 or less. This is the amount of your tax rebate, which the state will apply toward your 2010 and 2011 tax bills for taxes due in 2012.

3. Multiply your 2006 property tax bill by 6.67 percent if your 2010 annual income was over $50,000 but less than $75,000. This is the amount of your tax rebate, which the state will apply toward your 2010 and 2011 tax bills for taxes due in 2012.

Tips & Warnings

• For disabled or elderly New Jersey residents who meet the income, age and disability requirements as of Dec. 31, 2010, the New Jersey homestead exemptions are limited to residents with annual incomes of $150,000 or less for the 2010 and 2011 tax years. For low-income New Jersey residents who are not disabled or elderly as of Dec. 31, 2010, the New Jersey homestead exemptions are limited to residents with annual incomes of $75,000 or less for the 2010 and 2011 tax years.

• You cannot apply for a New Jersey homestead exemption if you are completely exempt from property taxes through other state or federal laws.

• Since tax laws can frequently change, do not use this information as a substitute for legal advice. Seek advice through an attorney licensed to practice law in New Jersey.

References

• New Jersey Division of Taxation: Homestead Benefit Information
• New Jersey Division of Taxation: Homestead Tax Credit Frequently Asked Questions
• New Jersey Division of Taxation: Homestead Benefit
• New Jersey Division of Taxation: Homestead Benefit Information for Homeowners Age 65 or Older and/or Disabled on December 31, 2010
• New Jersey Division of Taxation: Homestead Benefit Information for Homeowners Under Age 65 and NOT Disabled on December 31, 2010
• New Jersey Division of Taxation: Homestead Benefit Amount for Homeowners Under Age 65 and NOT Disabled on December 31, 2010

Resources

• New Jersey Division of Taxation: Homestead Benefit Online Filing