NEW JERSEY – Building upon his efforts to uplift New Jersey’s small businesses, Senator Troy Singleton introduced legislation this week to provide a 20% income tax deduction for certain business owners.
“Small business are the lifeblood of our communities. They not only employ our neighbors and give personality to our main streets, they give back to the towns they call home and drive our state’s economy,” said Singleton (D-Burlington). “This legislation will offer significant tax relief to the small business community, allowing them to invest back in themselves and their employees.”
The bill, S-3757, would mimic the federal small business tax deduction, allowing certain business owners to claim a similar deduction on their state tax returns starting in 2023.
Under the federal income tax deduction, incorporated into New Jersey income tax under this bill, income must be under $182,100 for single filers or $364,200 for joint filers. For taxpayers of that limit, IRS rules consider various factors to determine whether a business income qualifies for a partial or full deduction.