Murphy touts tax relief. Most will see none
Gov. Phil Murphy and Democratic legislative leaders were touting property tax relief on Monday as part of a budget deal, but the vast majority of New Jersey residents wont see any such relief.
Income requirements for the program remain frozen at 2017 levels. The cutoff for benefits is $150,000 for homeowners over the age of 65 and $75,000 for homeowners under 65.
The 2022 state budget estimates that around 488,000 people will receive homestead benefit credits in the coming year, including 364,000 senior and disabled homeowners with incomes under $150,000 and 124,000 non-senior homeowners with incomes under $75,000. The median income in New Jersey is approximately $82,000 per year.
The Homestead Rebate Program has a long and rocky history. At its peak in 2007, more than 2.5 million households received some level of benefit. The number has been on a steady decline ever since, even though property taxes have increased 40% over the same time period.
When Gov. Brendan Byrne imposed the first income tax in New Jersey in 1976, the Legislature also enacted the Homestead rebate to provide some relief. Facing a backlash from voters unhappy with the new income tax, Byrne sent out the first paper checks a month before his re-election in 1977 and he won a second term.
For decades, the checks were sent out in October and almost every homeowner, and many renters, got one. Checks averaged more than $1,000. Only the wealthiest state residents were excluded. The program reached it's peak during the Jon Corzine administration, and has been shrinking ever since.
Chris Christie revised the program and eliminated the direct checks to tax payers, instead converting them to a credit that appeared on individual tax bills. Today, rebate credits amount to only a few hundreds dollars per eligible homeowner.