NJ families getting $500 rebate checks. Here's who gets them, and when they arrive

“About 760,000 middle class families are expected to receive rebate checks of up to $500 as part of the deal lawmakers and Gov. Phil Murphy reached last year to raise taxes on people who make more than $1 million a year.”

About 760,000 middle class families are expected to receive rebate checks of up to $500 as part of the deal lawmakers and Gov. Phil Murphy reached last year to raise taxes on people who make more than $1 million a year.

The checks go out soon, just months before Murphy and all 120 state lawmakers are up for election in November and hoping to maintain Democratic control of the state. The rebates are funded in the $46.4 billion state budget Murphy is expected to sign into law this week.

Here's what you need to know about the rebates, who gets them and when they'll arrive.

How do I get a rebate check?

Taxpayers who live in New Jersey are eligible if they meet the following criteria:

  • have at least one child claimed as a dependent
  • had a gross income under $150,000 for married couples filing jointly, surviving spouses or heads of households; or $75,000 for single taxpayers or married couples who file taxes individually
  • paid at least $1 in income taxes in 2020

Do I need to apply?

No. The rebates will be automatically calculated and distributed based on your 2020 taxes.


When will I get the rebate?

The state will begin sending out checks on July 1. They will be cut separately from regular income tax refunds.

Where does my check go?

The checks will be sent to the address on your NJ-1040 income tax return.

Does everyone get $500?


Residents who paid less than $500 in income tax will receive an amount equal to what they paid. For example, if an eligible family paid $250 in taxes, they would get a $250 rebate check. The most anyone can get back is $500.

The rebate will also be prorated for part-time residents based on the number of months they lived in New Jersey.


Do I pay taxes on the rebate?


How much does this cost New Jersey?

Sending out the rebates is expected to cost the state about $319 million, roughly what the state Treasury estimated millionaires would contribute under the higher tax rate.


Where did this rebate plan come from?

Murphy, a Democrat, pledged during his first campaign for governor that he would increase taxes on millionaire earners, painting it as an equity issue.

But when he sought approval from Senate President Stephen Sweeney and Assembly Speaker Craig Coughlin, both Democrats balked. It was an about-face — the Legislature had previously approved a higher tax rate multiple times, but it was vetoed by Gov. Chris Christie.

After the COVID pandemic struck, Coughlin convinced Sweeney to support the tax hike if the proceeds went to help middle-class residents.

Now incomes over $1 million are taxed at a rate of 10.75%, up from the previous top rate of 8.97%.

Murphy said last year that the rebate would "spur resiliency and economic growth in our state." The rebate, Sweeney said last week, would "be spent in the local economy, generating jobs and business activity in communities across the state."

Stacey Barchenger is a reporter in the New Jersey Statehouse. For unlimited access to her work covering New Jersey’s policymakers and political power structure, please subscribe or activate your digital account today.

Email: [email protected] 

Twitter: @sbarchenger