Gov. Phil Murphy said he hopes the state budget “will be able to support the implementation of Stay NJ.” (Dana DiFilippo | New Jersey Monitor)

Gov. Phil Murphy signed bill Friday make a series of technical changes to three state tax relief programs.

The bill aims to align Stay NJ – a tax credit program that promises to cut seniors’ tax bill in half, up to an index cap of $6,500, starting in 2026 – with the senior freeze and Anchor property tax refund programs.

“I am signing this bill because I believe streamlining Senior Freeze and Anchor will benefit our seniors, and I hope the state budget will be able to support the implementation of Stay NJ,” the governor said in a statement. released with the signing of the bill.

Among other things, the bill changes the definition of income under Stay NJ to include Social Security, retirement, and other types of income generally excluded from taxation. The changes could push some residents above Stay NJ’s $500,000 income limit.

It requires residents who receive tax relief under the three programs to reduce the property tax deduction from the state income tax by an amount equal to their allowances and allows officials to pay Stay NJ benefits through rebates while officials implement a tax credit system that aligns. with the three programs.

Some have doubted that the tax break promised by Stay NJ will materialize one day.

The program is expected to cost the state $1.2 billion annually once it is in full effect, and statutory text prohibits New Jersey from administering the Stay NJ tax credits if the state cannot not pay pensions in full, fully finance educational assistance and maintain a surplus equal to 12% of expenses.

The spending bill signed by Murphy in late June projects that the state will have a 10.9 percent appropriations surplus by the end of the July-June fiscal year and has a structural deficit of 2.1 billion of dollars.

The limits are not absolute. Lawmakers crushed Stay NJ’s surplus requirement through budget language in the current fiscal year and could do so again in the future.

“I am committed to maintaining these safeguards while working with my partners in the Legislature to achieve the goal of lasting property tax relief for seniors,” Murphy said.

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