What’s the latest on the Stay NJ property tax cut?

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Q. What’s the latest on the Stay NJ property tax cut?
— Eager homeowner

A. It’s a very timely question.

The Stay NJ law was passed last year. It would cut property taxes by up to 50% on primary residences for those who are 65 and older and earn less than $500,000 a year, starting in 2026. The maximum benefit would be $6,500.

But as you may have seen in The Star-Ledger, a fight is brewing over the tax cut as part of the state budget negotiations, which are happening now.

Gov. Phil Murphy and lawmakers must agree to a new state budget by July 1 or risk a state government shutdown.

At issue is Murphy’s proposed a 2.5% tax on corporations that would be earmarked to fund the perpetually cash-strapped NJ Transit. But some lawmakers want more funding in the coming budget to support Stay NJ, even though the property tax cut wouldn’t start making payouts until 2026.

Right now, the Stay NJ Task Force is coming up with recommendations on how to make the property tax break work. Those are due to the state Legislature by May 30, and we’re hearing it will come down to the wire. And the recommendations will strongly influence how the current budget negotiations go, with some expecting pushback and something of a tug of war between those who want funding for Stay NJ, and the governor, who wants the 2.5% tax to support transit.

Last week, Murphy tried to brush aside talk of a showdown over the budget. On his “Ask the Governor” show, he said he wouldn’t go into the specifics.

But he said:

“I feel really good about the relationship we have with (lawmakers). None of this is easy, but I’m highly optimistic we’ll land in a good place.”

So, it seems, there’s more to come.

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This story was originally published in May 2024.

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