TAXES 18-62, New Jersey State Income Tax Withholding

Published: August 03, 2018
Effective: Pay Period 15, 2018

Summary

The tax rate on wages over $5,000,000 will change for the State of New Jersey to 15.6 percent. No action on the part of the employee or the personnel office is necessary.

Tax Formula

State Abbreviation:	NJ
State Tax Withholding State Code:	34
Acceptable Exemption Form:	NJ - W4
Basis for Withholding:	State or Federal Exemptions
Acceptable Exemption Data:	S/M/C/D/E, Number of Exemptions
TSP Deferred:	No
Non Federal 401(k) Deferred:	Yes
Additional Information:	If a State income tax certificate has not been processed or if a valid State exemption code is not present, the Federal exemptions will be used in the computation of the State tax.

Special Coding:

First Position - Determine the Total Number of Allowances Claimed as follows:

If Item 3 of the NJ W4 Contains:	Enter:
A	S
B	M
C	C
D	D
E	E

If Item 3 of the NJ-W4 Is Blank and If the Status on Line 2 Is:	Enter:
Single	S
Married/Civil Union Couple Joint	M
Married/Civil Union Couple Separate	S
Head of Household	M
Surviving Spouse/Surviving Civil Union Partner	M

Second and Third Positions - Enter the total number of exemptions claimed in Item 4 of the NJ-W4. If less than 10, precede with a zero (0).

Withholding Formula (Effective Pay Period 15, 2018)

Subtract the nontaxable biweekly non-Federal 401(k) contribution from the gross biweekly wages to obtain the adjusted gross biweekly wages.
Note: Do not subtract the biweekly Federal Thrift Savings Plan (TSP) contribution from the gross biweekly wages.
Multiply the adjusted gross biweekly wages by the number of pay dates in the tax year to obtain the gross annual wages.
Determine the exemption allowance by applying the following guideline and subtract this amount from the gross annual wages to compute the taxable income:
Exemption Allowance = $1,000 x Number of Exemptions

Apply the taxable income computed in step 3 to the following table(s) to determine the annual New Jersey tax withholding:

Single or Married/Civil Union Couple - Filing Separately (Rate Table A)

If the Amount of Taxable Income Is:	The Amount of New Jersey Tax Withholding Should Be:
Over $0 but not over $20,000	1.5%
Over $20,000 but not over $35,000	$300.00 plus 2.0% of excess over $20,000
Over $35,000 but not over $40,000	$600.00 plus 3.9% of excess over $35,000
Over $40,000 but not over $75,000	$795.00 plus 6.1% of excess over $40,000
Over $75,000 but not over $500,000	$2,930.00 plus 7.0% of excess over $75,000
Over $500,000 but not over $5,000,000	$32,680.00 plus 9.9% of excess over $500,000
Over $5,000,000	$478,180.00 plus 15.6% of excess over $5,000,000

Married/Civil Union Couple - Filing Jointly or Head of Household or Surviving Spouse/Surviving Civil Union Partner (Rate Table B)

If the Amount of Taxable Income Is:	The Amount of New Jersey Tax Withholding Should Be:
Over $0 but not over $20,000	1.5%
Over $20,000 but not over $50,000	$300.00 plus 2.0% of excess over $20,000
Over $50,000 but not over $70,000	$900.00 plus 2.7% of excess over $50,000
Over $70,000 but not over $80,000	$1,440.00 plus 3.9% of excess over $70,000
Over $80,000 but not over $150,000	$1,830.00 plus 6.1% of excess over $80,000
Over $150,000 but not over $500,000	$6,100.00 plus 7.0% of excess over $150,000
Over $500,000 but not over $5,000,000	$30,600.00 plus 9.9% of excess over $500,000
Over $5,000,000	$476,100.00 plus 15.6% of excess over $5,000,000

Optional Rate Table C

If the Amount of Taxable Income Is:	The Amount of New Jersey Tax Withholding Should Be:
Over $0 but not over $20,000	1.5%
Over $20,000 but not over $40,000	$300.00 plus 2.3% of excess over $20,000
Over $40,000 but not over $50,000	$760.00 plus 2.8% of excess over $40,000
Over $50,000 but not over $60,000	$1,040.00 plus 3.5% of excess over $50,000
Over $60,000 but not over $150,000	$1,390.00 plus 5.6% of excess over $60,000
Over $150,000 but not over $500,000	$6,430.00 plus 6.6% of excess over $150,000
Over $500,000 but not over $5,0000,00	$29,530.00 plus 9.9% of excess over $500,000
Over $5,000,000	$475,030.00 plus 15.6% of excess over $5,000,000

Optional Rate Table D

If the Amount of Taxable Income Is:	The Amount of New Jersey Tax Withholding Should Be:
Over $0 but not over $20,000	1.5%
Over $20,000 but not over $40,000	$300.00 plus 2.7% of excess over $20,000
Over $40,000 but not over $50,000	$840.00 plus 3.4% of excess over $40,000
Over $50,000 but not over $60,000	$1,180.00 plus 4.3% of excess over $50,000
Over $60,000 but not over $150,000	$1,610.00 plus 5.6% of excess over $60,000
Over $150,000 but not over $500,000	$6,650.00 plus 6.5% of excess over $150,000
Over $500,000 but not over $5,000,000	$29,400.00 plus 9.9% of excess over $500,000
Over $5,000,000	$474,900.00 plus 15.6% of excess over $5,000,000

Optional Rate Table E

If the Amount of Taxable Income Is:	The Amount of New Jersey Tax Withholding Should Be:
Over $0 but not over $20,000	1.5%
Over $20,000 but not over $35,000	$300.00 plus 2.0% of excess over $20,000
Over $35,000 but not over $100,000	$600.00 plus 5.8% of excess over $35,000
Over $100,000 but not over $500,000	$4,370.00 plus 6.5% of excess over $100,000
Over $500,000 but not over $5,000,000	$30,370.00 plus 9.9% of excess over $500,000
Over $5,000,000	$475,870.00 plus 15.6% of excess over $5,000,000

Divide the annual New Jersey tax withholding calculated in step 4 by the number of pay dates in the tax year to obtain the biweekly New Jersey tax withholding.

Resources

To view the updated tax formula, go to the HR and Payroll Clients page from the MyNFC drop-down menu on the National Finance Center (NFC) homepage. Select the Publications tab and select U.S. Income Tax Formulas from the Publications menu to launch the tax map. Select the desired State from the map provided for the formula.

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