New Legislation Excludes Combat Pay from Gross Income Taxation

By: Michael Mandarino, Follow South Jersey Assignment Editor

Photo: Jon Bradley | Follow South Jersey

TRENTON, N.J. — Governor Phil Murphy signed legislation on Monday that no longer allows combat pay to be taxable under New Jersey’s state income tax.

New Jersey was the only state in the country to charge taxes on combat pay, which is earned by active members of the military, before Monday’s legislation was signed. Combat pay is also not taxed by the United States’ federal government.

“Members of the military put everything on the line for our state and our country.” Gov. Murphy said in a press release. “I am happy and proud that, even in the midst of our state’s most serious fiscal crisis, we were able to find a way to make life easier for our troops and provide some long-overdue relief to the bravest among us.”

Senators Shirley Turner, Michael Testa, and Kristin Corrado were among the primary sponsors of the bill along with Assemblymembers Annette Quijano, Cleopatra Tucker, and Wayne DeAngelo.

“Previous versions of this important bill have languished in the Legislature for 10 years. When I was sworn into the Senate in January, I made this one of my priorities and began advocating for its passing and enactment on behalf of American servicemen and women,” Testa (R-1) said in a release. “I am proud that working with colleagues on both sides of the aisle, we are finally reversing the insensitive policy, and I thank the Governor for his support.”

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