30 Oct In what tax year does the ‘millionaire’s tax’ start?

Q. Will the millionaire’s tax be included for the 2020 New Jersey filing or 2021?
— Later, I hope

A. It starts for the tax year 2020.

This will affect individuals earning between $1 million and $5 million, said Jonathan Donenfeld, a certified public accountant with JLD Tax & Accounting in Jersey City.

“Their rates will increase from 8.97% to 10.75% on that portion of their income — between $1 million and $5 million,” he said. “It’s worth noting that only four states — California, Hawaii, Oregon, and Minnesota — will have higher top bracket rates than New Jersey’s second-highest tax bracket.”

Donenfeld said he’s working with several clients to see how much they would save if they moved to another state, and one has already decided to move to New Hampshire.

“Due to COVID, many people are now able to work remotely, so they are exploring living in states with lower income and property taxes and lower overall cost of living, which previously was not possible,” he said.

Email your questions to .

This story was originally published Oct. 30, 2020.

NJMoneyHelp.com presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.