New Jersey Assembly Bill A4871

New Jersey 2026-2027 Regular Session

• Introduced: 5/4/26
• Refer: 5/4/26

Caption

Allows gross income tax deduction for charitable contributions made to nonprofit entities supported by State funds or subsides.

Summary

A4871 would amend New Jersey gross income tax law to allow taxpayers to deduct charitable contributions made during the taxable year to certain nonprofit entities that receive State funds or an economic development subsidy in that year. The deduction is capped at $10,000 for married taxpayers filing jointly and heads of household, and $5,000 for married individuals filing separately, single filers, and surviving spouses. The bill defines the covered nonprofits broadly as organizations not operated for private profit and not part of government, and it defines “economic development subsidy” to include a range of State financial assistance tools such as grants, loans, loan guarantees, matching funds, tax credits, bonds, and other incentives, while excluding ordinary procurement contracts. The bill would take effect immediately but apply only to charitable contributions made in taxable years beginning on or after the January 1 following enactment.

Impact

The bill would create a new gross income tax deduction in Title 54A for qualifying charitable contributions, thereby reducing taxable income for eligible New Jersey taxpayers who donate to covered nonprofit entities. It would also indirectly benefit nonprofits that receive State support or subsidies by making donations to them more tax-advantaged, potentially encouraging private giving to organizations already connected to public funding or economic development programs.

Sentiment

No committee transcripts or recorded votes were provided, so there is no documented legislative debate or voting pattern to gauge support or opposition. Based on the bill text alone, the measure appears framed as a tax incentive for charitable giving and support of nonprofits, suggesting a generally pro-charity and pro-nonprofit policy approach, but the available record does not show whether lawmakers or stakeholders expressed agreement or concern.

Contention

The main policy questions likely center on the scope of the deduction and which nonprofits qualify. Potential points of contention include whether the tax benefit should extend to nonprofits that already receive State funds or subsidies, whether the deduction could disproportionately favor certain organizations tied to economic development incentives, and the revenue impact on the State treasury. The bill’s broad definition of economic development subsidy and the inclusion of nonprofits receiving State support may also raise questions about administration and eligibility.