New Jersey paycheck guide
How New Jersey calculates income tax in 2026
New Jersey does not start from federal adjusted gross income. It builds its own gross income figure from wages, then subtracts personal exemptions: $1,000 for a single filer and $2,000 for a married couple filing jointly. There is no standard deduction, so the low starting rates do the work that a deduction does elsewhere.
Single filers pay 1.4% on the first $20,000 of taxable income, 1.75% up to $35,000, 3.5% up to $40,000, and 5.53% up to $75,000. From $75,000 to $500,000 the rate is 6.37%, then 8.97% up to $1 million and 10.75% above that. Married couples get wider brackets, including an extra 2.45% band, so the 6.37% rate does not start until their taxable income passes $150,000.
Because New Jersey writes its own definition of income, retirement plans are treated differently than on your federal return. Traditional 401(k) deferrals are excluded from New Jersey wages, but contributions to a 403(b) or 457 plan are not, which means teachers, nurses, and government workers pay New Jersey tax on money they set aside.
Worked example: a $75,000 salary in New Jersey
Start with $75,000 of wages and subtract the $1,000 exemption, leaving $74,000 of taxable income. The first $20,000 is taxed at 1.4% ($280), the next $15,000 at 1.75% ($263), the next $5,000 at 3.5% ($175), and the last $34,000 at 5.53% ($1,880). New Jersey tax totals $2,598, an effective rate of 3.46%.
Federal tax is $7,670 after the $16,100 standard deduction: $12,400 at 10%, $38,000 at 12%, and $8,500 at 22%. Social Security takes $4,650 and Medicare $1,088, leaving $58,994, about $4,916 a month. The New Jersey $75,000 salary page breaks it down by pay period.
The next dollar you earn crosses into the 6.37% bracket. At $150,000, $74,000 of income is taxed at that rate, adding $4,714, and the state bill reaches $7,367, an effective rate of 4.91%. Take-home at that salary is $106,424.
Disability, family leave, and unemployment deductions
New Jersey is one of the few states where employees pay into unemployment insurance, and workers also contribute to state temporary disability insurance and family leave insurance. All three come out of each paycheck as separate lines on your stub, and each is capped at an annual wage base set by the Department of Labor.
This calculator leaves those contributions out, so your actual take-home will be a little lower than the figures on this page. There is no city or county income tax in New Jersey. Newark and Jersey City do levy payroll taxes, but those are charged to employers rather than withheld from your wages.
Form NJ-W4, Pennsylvania reciprocity, and New York commuters
New Jersey withholding is set by Form NJ-W4, not the federal W-4. Besides filing status and allowances, the NJ-W4 lets two-earner households pick a rate table, A through E, so combined withholding comes closer to what the couple will actually owe. Without it, two salaries taxed separately at the low brackets often under-withhold.
New Jersey and Pennsylvania have a reciprocity agreement. A Pennsylvania resident working in Camden or Trenton gives the employer Form NJ-165 and pays state tax only to Pennsylvania. A New Jersey resident working in Pennsylvania files Form REV-419 with the employer to stop Pennsylvania withholding. The agreement covers state tax only, so Philadelphia's own wage tax still applies to work done in the city.
There is no reciprocity with New York. If you live in Hoboken or Montclair and work in Manhattan, New York taxes those wages as a nonresident, and New Jersey gives a credit for that tax against the New Jersey tax on the same income. New York City's own income tax applies to residents only, so it does not touch New Jersey commuters. If your New Jersey tax on those wages would exceed the New York credit, ask payroll to withhold the difference for New Jersey.
How New Jersey compares with New York, Pennsylvania, and Delaware
At $75,000, New Jersey sits in the middle of the pack, 28th of 51 for single-filer take-home pay. A New Jersey worker keeps $855 more than in New York and $1,011 more than in Delaware, but $296 less than in Pennsylvania, whose 3.07% flat rate is lower at this salary. See New Jersey vs Pennsylvania for the side-by-side numbers.
The ranking slips at higher pay, because the 6.37% bracket begins at $75,000 for single filers. At $150,000 New Jersey ranks 39th. Compared with a state with no income tax, New Jersey costs a $75,000 earner $2,598 a year; the New Jersey vs New York comparison shows how close the two get for commuters.
What to expect at your income
Earning under $50,000
Under $50,000, New Jersey's 1.4% and 1.75% brackets keep the state bill small. A single filer earning $30,000 pays $438, and at $50,000 the tax is $1,215, an effective rate of 2.43%, leaving $41,140 to take home. A full-time hourly job paying $41,600 a year leaves about $34,855 after $751 of state tax. Disability, family leave, and unemployment contributions are excluded from these figures, so expect slightly less on each stub, and check New Jersey's earned income tax credit when you file.
Earning $50,000 to $150,000
In this range each extra dollar is taxed at 5.53% until taxable income reaches $75,000, then 6.37%. A single filer earning $100,000 pays $4,182 to New Jersey and takes home $74,998, or $6,250 a month. Married couples fare better: at the same $100,000 joint income the state bill is $2,640. A traditional 401(k) lowers New Jersey tax, but a 403(b) or 457 deferral does not, so public-sector workers should not count on state savings.
Earning over $150,000
Above $150,000, New Jersey's 6.37% rate applies to every taxable dollar up to $500,000, then 8.97%, and 10.75% beyond $1 million. At $250,000, New Jersey takes $13,737, or 5.49% of salary, and a single filer keeps $169,445. High earners who commute to New York should make sure New York withholding plus New Jersey withholding covers the combined bill, since the credit only offsets New Jersey tax on the same wages.
New Jersey paycheck tips
Pick a rate table on the NJ-W4
If both spouses work, choose the NJ-W4 rate table that matches your combined income. It is the simplest fix for a balance due on the NJ-1040.
Pennsylvania residents: file NJ-165
Living in Pennsylvania and working in New Jersey? Give your employer Form NJ-165 so New Jersey tax is not withheld, and pay state tax only to Pennsylvania.
Favor the 401(k) over a 403(b) for state savings
If your employer offers both, only 401(k) deferrals reduce New Jersey taxable wages. The federal savings are the same either way.
Claim the property tax deduction or credit
Homeowners and renters can deduct property taxes, or the share of rent treated as property tax, on the New Jersey return up to a limit, or take a small credit instead. It affects your refund, not your paycheck.
Budget for the payroll contributions
Subtract the disability, family leave, and unemployment lines on your stub from our take-home figure to get your true net pay.
Common mistakes
Assuming your W-2 box 16 matches box 1
New Jersey wages often exceed federal wages, because 403(b) and 457 deferrals stay taxable for the state. Check box 16 before you file.
Expecting reciprocity with New York
Only Pennsylvania has a reciprocity agreement with New Jersey. New York commuters pay New York tax and claim a credit at home on the NJ-1040.
Under-withholding as a two-earner couple
Each employer withholds as if your salary were the only one, so two incomes can land in the 5.53% or 6.37% bracket with too little withheld. The NJ-W4 rate tables exist for this.
Moving to or from New Jersey
Moving to New Jersey
Moving to New Jersey from New York usually lowers state tax at $75,000 by $855 and removes New York City tax if you lived in the boroughs. Coming from Pennsylvania costs $296 more at that salary. Either way, file an NJ-W4 with your employer and expect disability, family leave, and unemployment contributions on every paycheck, which this estimate leaves out.
Leaving New Jersey
Leaving New Jersey for a state with no income tax saves a $75,000 earner $2,598 a year, plus the state's payroll contributions. A move across the Delaware River to Pennsylvania saves $296 at the state level, but check local wage taxes there. If you keep a New Jersey job after moving, you will file a nonresident return, and part-year residents report income earned while they lived in the state.