U.S. Rep. Josh Gottheimer, D – 5th District, Democratic state Senate President Steve Sweeney and state Sen. Paul Sarlo, D – Wood-Ridge, jointly touted a recently introduced state bill that would allow for tax contributions for charitable contributions.
The bill, introduced last month and set for a vote in the state senate Monday, is intended as a short-term measure in response to recent federal tax changes.
“As we all know, the tax cuts continued to move through Congress and states like New Jersey were just devastated,” Sarlo said at the news conference today in Paramus. “Our taxpayers were devastated. Quite frankly, property tax prices in New Jersey were kicked in the teeth. Steve Sweeney and I are not going to allow that to happen at the state level, so we developed our charitable contribution plan. That bill, under the leadership of our senate president and myself as budget chairman, has already been heard in budget committee and now is headed to the floor of the senate. And very soon to the floor of the assembly.”
Gottheimer said the bill would allow for municipalities to create charitable funds for public services. Taxpayers may elect to make contributions to these funds for which they will receive a tax credit on their local property taxes.
The congressman added that the bill will provide relief to taxpayers following the newly instituted cap on state and local tax deductions passed by congress.
“We expect the contributions to be deductible for federal tax purposes under existing law, effectively providing a way to restore most of the benefit of the lost state and local tax deduction for most tax payers who itemize, even if they otherwise pay the alternative minimum tax,” Gottheimer said. “Thirty-three other states--many of them dark red, from Arizona to South Carolina--have created programs built on the same principles we are putting to work here. Utilizing the same tax code and these provisions in other states have been around for decades. These programs are recognized by the IRS and the tax courts. There is even a Supreme Court ruling on it.”
Gottheimer said he, Sweeney and Sarlo expect opposition to the state bill. But he said it’s of paramount importance to New Jersey residents.
“We need to do everything possible to make living in New Jersey more affordable for our residents and our businesses,” he said. “Unfortunately, when things got jammed through last year and congress jammed through the tax bill, they gutted the state local tax deduction giving relief to some states and dropping a huge tax hike on others, like ours.”
Sweeney said Sarlo and Steve Oroho will lead the charge on finding a long-term solution to the tax relief in the state.
“We expect to bring some very big things forward so that we can start making New Jersey more affordable,” he said. “Not that things are going to be easy, we know things are going to be hard and people will not want to have the conversations, but we’re going to have that conversation because the people of New Jersey deserve it. This is a very good opportunity for us to deal with the immediate issue. For long-term issues, I have Senators Sarlo and Orho right now and we’re going to be coming back with some big ideas--some controversial ideas, but it is time to have these conversations.”