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General Instructions
Property Tax Deduction

Application Filing Period
File this claim with the municipal tax assessor from October 1 through December 31 of the pre-tax year, i.e., the year prior to the calendar tax year or with the municipal tax collector from January 1 through December 31 of the calendar tax year.
 
For example, for a property tax deduction claimed for calendar tax year 1997, the pre-tax year filing period would be October 1, 1996 - December 31, 1996 with the assessor and the tax year filing period would be January 1, 1997 - December 31, 1997 with the collector.

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Eligibility Dates
Eligibility for the property tax deduction is established prior to the calendar tax year for which the deduction is claimed as follows: 
  • New Jersey Citizenship as of October 1 pre-tax year
  • Property Ownership as of October 1 pre-tax year
  • Residence in New Jersey and in Dwelling House as of October 1 pre-tax year and
  • Residence in New Jersey for 1 year immediately prior to October 1 pre-tax year
  • Senior Citizen Age 65 or more as of December 31 pre-tax year
  • Permanent and Total Disability as of December 31 pre-tax year
  • Surviving Spouse Age 55 or more as of December 31 pre-tax year and at the time of spouse's death

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Citizen Resident Defined
United States Citizenship is not required. Resident for purposes of this deduction means a claimant who was legally domiciled in New Jersey for one year immediately prior to October 1 of the pre-tax year. Domicile is the place you regard as your permanent home - the place you intend to return to after a period of absence.

You may have only one legal domicile even though you may have more than one residence. Seasonal or temporary residence in this state, of whatever duration, does not constitute domicile. Absence from the state for a 12 month period is prima-facie evidence of abandonment of domicile.

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Residence in Dwelling House Defined
Residence in the dwelling house means the dwelling where a claimant makes his principal or permanent home. Vacation, summer or second homes do not qualify. Only one deduction may be received per principal residence regardless of the number of qualified claimants residing on the premises.

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Tenancy by Entirety Defined
Tenancy by Entirety means ownership of real property by both husband and wife, as a single ownership, in joint title acquired after marriage.

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Income Defined Limited
  • The income period is the same tax year as the tax year for which a deduction is claimed. 
  • A claimant must reasonably anticipate that income received during the tax year, including income of the claimant's spouse, will not exceed $ 10,000. Income of claimant's family members, other than spouse should not be included as annual income. 
  • Income means all income received from whatever source derived including, but not limited to:
    • Bonuses
    • Business income
    • Commissions
    • Dividends
    • Income from rents
    • Interest
    • Other compensations before payroll deductions
    • Pension, annuity, and retirement benefits in their entirety
    • Realized capital gain
    • Royalties
    • Salaries
    • Tips
    • Wages

Realized Capital Gains
Realized capital gains, except for capital gain from the sale or exchange of real property owned and used by the claimant as his principal residence, dividends, interest, pensions, annuities, and retirement benefits must be included in full without deductions even though they may be wholly or partially exempt for federal income tax purposes.

Excludable Income
Income can be excluded under one of the following three categories: 
  • Social security benefits or federal government retirement disability pension including Federal Railroad
  • Retirement benefits or state, county, municipal government, and their political subdivisions and agencies
  • Retirement / disability pension

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Documentary Proofs Required
Each assessor and collector may require such proofs necessary to establish claimant's deduction entitlement and photocopies of any documents should be attached to this form as part of application record.

Age Verifications
  • Baptismal record
  • Birth certificate
  • Census record
  • Court record
  • Family bible
  • Immigration document
  • Insurance policy
  • Marriage certificate
  • Military record or discharge
  • Social Security record

Disability Verifications
  • Certificate
  • New Jersey Commission for Blind
  • Physician's certificate
  • Social Security document

Surviving Spouse Verifications
  • Death certificate of decedent

Ownership Verifications
  • Deed
  • Executory contract for property purchase
  • Last will and testament

Residence Verifications
  • Motor vehicle registration
  • New Jersey driver's license
  • Voter's registration

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Annual Post-Tax Year Income Statement Required
On or before March 1 of the year immediately following the tax year for which deduction was claimed or received, a claimant must file a Post-Tax Year Income Statement, Form PD5, confirming that annual income for the tax year did not exceed the $10,000 limit and that anticipated annual income for the current year will not exceed that limit and that all other eligibility prerequisites continue to be met.

For example, the Post-Tax Year Income Statement filed by March 1, 1998 supports the claim for deduction for tax year 1997 by confirming 1997 income. Anticipated income would refer to income received in tax year 1998 for the 1998 deduction.

Failure to File
If this income statement is not timely filed, deduction will be disallowed and claimant will be billed for the amount.

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Appeals
A claimant may appeal any unfavorable determination by the assessor or collector to the County Board of Taxation annually on or before April 1.

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The Form
This form is prescribed by the New Jersey Division of Taxation, as required by law, and may be reproduced for distribution, but may not be altered without prior approval.

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