08 Aug We’re moving to Florida. Can we still get the Homestead Rebate?

Q. My wife and I recently sold our New Jersey home. We moved to Florida. She left on July 22 and I’m going on Nov. 22. How do we determine the exit tax amount and can we still file for the Homestead Rebate?
— Out of here

A. There are a few items here.

First, the Homestead Rebate is no more. It was replaced by the ANCHOR benefit starting with the 2019 benefit year, which is the benefit paid out earlier this year.

We expect applications for the 2020 tax year benefit to be available in the fall.

The 2020 tax year ANCHOR has a higher benefit from the year before: so renters with income of $150,000 or less will get $700 a year, homeowners making less than $150,000 will get $1,750 and those making between $150,000 and $250,000 would get $1,250.

The residency requirement would follow the year before and be Oct. 1, 2020, so if you meet the income limitations, you would be eligible for the benefit.

As for the exit tax, this is not actually a separate tax, but an estimated tax payment to cover the income tax resulting from the gain on the sale of real estate in New Jersey, said Bernie Kiely, a certified financial planner and certified public accountant with Kiely Capital Management in Morristown.

“If you sell a residence that you lived in as your principal residence for 24 out of the previous 60 months, you can exclude from taxation $250,000 if you’re single or $500,000 if you are married filing jointly,” he said. “The home sale exclusion is a federal tax rule that New Jersey follows.”

Assuming you lived in your New Jersey home for 24 months, you would qualify for the exclusion, Kiely said.

The exit tax — the tax withheld when you sell — is the greater of 8.97% or 2% of the selling price.

At the closing, you’ll have to complete GIT/REP3, Seller’s Residency Certification/Exemption, a form that has exemptions for paying the estimated tax.

Note that when a New Jersey resident moves out of the state, they are considered a non-resident on or after the day of transfer, and part-year residents are considered non-residents.

If you don’t owe any tax but it’s withheld at the closing, you will have to file NJ-1040 as a non-resident to get your refund.

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This story was originally published on Aug. 8, 2023.

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