N.J. Admin. Code § 18:35-3.1

Current through Register Vol. 56, No. 11, June 3, 2024

Section 18:35-3.1 - Estimated tax

(a) Every resident and nonresident individual shall make a declaration of the individual's estimated New Jersey personal income tax for each taxable year beginning after June 30, 1976, if the individual's estimated New Jersey personal income tax can reasonably be expected to be more than $ 400.00 in excess of any credits allowable against the individual's tax, whether or not the individual is required to file a Federal declaration of estimated tax for such year. Estates and trusts are required to file declarations of estimated tax, other than estates and trusts that meet the two-year limitation and other criteria of Internal Revenue Code section 6654(l).

(b) The term "estimated tax" means the amount which an individual estimates to be the individual's income tax under the Gross Income Tax Act for the taxable year, less the amount which the individual estimates to be the sum of any credits allowable against the tax.

(c)54A:8-4(d) requires individuals, other than farmers, who can reasonably expect their New Jersey personal income tax to be more than $ 400.00 in excess of any credits allowable against the individual's tax, to file a declaration of estimated tax on or before April 15 of the taxable year. Fiscal year taxpayers shall estimate their tax for the period covered by their fiscal year, and file a declaration of estimated tax on the 15th day of the fourth, sixth, or ninth month of their fiscal year or the first month after the end of their fiscal year. 54A:8-4(d) also divides the remainder of the taxable year into three periods. If during the period the individual becomes subject to the gross income tax, for example as a part-year resident, or it becomes apparent that the individual's (other than farmer's) personal income tax for the taxable year can reasonably be expected to be more than $ 400.00 in excess of any credits allowable against the individual's tax, a declaration of estimated tax must be filed on or before the due date for the period. The periods and due dates are as follows:

1. After April 1 and before June 2 of the taxable year: June 15;

2. After June 1 and before September 2: September 15;

3. After September 1 of the taxable year; January 15 of the succeeding year.

Fiscal year taxpayers shall estimate their tax for the period covered by their fiscal year, and file a declaration of estimated tax on the 15th day of the fourth, sixth or ninth month of their fiscal year or the first month after the end of their fiscal year.

(d) A declaration of estimated tax of an individual having an estimated New Jersey income from farming (including oyster farming) for the taxable year which is at least two-thirds of the individual's New Jersey estimated income for the taxable year may be filed at any time on or before January 15 of the succeeding year.

(e) A declaration of estimated tax of an individual having a total estimated tax for the taxable year of $ 400.00 or less may be filed at any time on or before January 15 of the succeeding year.

(f)54A:8-5(a) requires payment of estimated tax in equal installments on due dates related to when the individual filed the declaration of estimated tax pursuant to (c) above. The due dates are as follows:

1. If the declaration is filed on or before April 15, installments are due on or before April 15 (with the filing of the declaration), June 15, September 15, January 15.

2. If the declaration is filed after April 15 and not after June 15: the first installment is due with filing of declaration, and the second and third installments are due on or before the following September 15 and January 15.

3. If the declaration is filed after June 15 and not after September 15, and is not required to be filed on or before June 15, the first equal installment is due with the filing of the declaration and the second equal installment is due on or before the following January 15.

4. If the declaration is filed after September 15, and is not required to be filed on or before September 15, the estimated tax is due in full at the time of the filing of the declaration.

5. If the declaration is filed late, all the installments that would have been due if the declaration was filed on time shall be paid with the filing of the declaration, and the remaining installments are due on the dates they would have been due if the declaration had been filed on time.

(g) An individual may amend a declaration of estimated tax, if the individual experiences an unanticipated increase or decrease in income, credits, exemptions, or deductions. If an amendment of a declaration is filed, any remaining installments shall be ratably increased or decreased to reflect any increase or decrease in the estimated tax. If any amendment is made after September 15 of the taxable year, any increase in the estimated tax shall be paid at the time of making such amendment. To amend a declaration, the individual should indicate any necessary changes when filing the next quarterly return. Form 2210 must be filed with the gross income tax return showing that declarations and payments properly reflect the receipt of income.

Example 1: A taxpayer (wage earner) sells an investment in the third quarter. The proper amount of tax has been withheld from taxpayer's wages. The taxpayer pays the tax related to the sale of the investment with the third quarter declaration of estimated tax and files Form NJ-2210 with his or her final return. No estimated interest is due.

(h) If on or before February 15 of the succeeding taxable year an individual files his or her return for the taxable year for which the declaration is required, and pays the full amount of the tax shown to be due on the return:

1. Such return shall be considered as his or her declaration if no declaration was required to be filed during the taxable year, but is otherwise required to be filed on or before January 15;

2. Such return shall be considered as the amendment permitted by 54A:8-4(g) to be filed on or before January 15, if the tax shown on the return is greater than the estimated tax shown in a declaration previously made.

i. Any amount overpaid and appearing on the face of any gross income tax return for the immediate preceding year may be applied in lieu of any payment of estimated tax otherwise due under this section where the taxpayer indicates on the face of such return that he or she elects to have such overpayment so applied. Such amount will be considered to be a payment of the first installment of the estimated tax for the next succeeding year unless the taxpayer designates otherwise on the face of the return for the year in which the overpayment was made. The taxpayer may apply the credit partially or fully to any installment. The taxpayer may divide the credit evenly so that the installment payments are also equal. When applying the credit, the taxpayer should subtract the amount of the credit being applied from the installment amount due for the period, then remit the balance. When completing the estimated tax voucher, Form NJ-1040ES, the taxpayer should indicate only the amount actually remitted.

N.J. Admin. Code § 18:35-3.1

Amended by 48 N.J.R. 295(a), effective 2/16/2016