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Division of Taxation

Help for Individuals and Businesses with State Taxes Owed to New Jersey

We are taking a number of steps to help financially distressed taxpayers meet their tax obligations. We wants to be certain that struggling taxpayers are aware of the available options.

If You or Your Business Owe Taxes

With many individuals and businesses facing financial difficulties, we are ready to help those who owe back taxes. We recognize that we must balance our responsibility to enforce the tax laws with the economic realities and hardships facing New Jersey businesses and individuals.

Our employees have flexibility to work with struggling taxpayers to assist them with their particular situations. Depending on the circumstances, taxpayers may be able to establish a payment plan for back taxes, adjust the payment terms and avoid defaulting on an existing payment agreement, or qualify for waiver of penalties. Taxpayers who are behind on their tax payments and need assistance should contact the phone number listed on the bill or correspondence they received from us. There could be additional help available if they are facing unusual hardship situations.

How to Minimize Your Future Income Tax Debt

Areas Where the Division can Provide Assistance

Payment Plans – Individuals and businesses experiencing financial difficulty may initiate the process of establishing payment arrangements for back taxes by reviewing the Payment Plan Request Guidelines and submitting the Payment Request Form.

Added Flexibility for Missed Installment Payments – We are allowing more flexibility for previously compliant individuals or businesses with existing Installment Payment Agreements. Taxpayers in a difficult financial situation should contact their assigned representative at the phone number shown on the installment proposal to discuss their circumstances.

Additional Review of Home Values – Certain Division programs require financial disclosure by the taxpayer. The equity taxpayers have in real property can be a barrier to an offer being accepted. With the uncertainty in the housing market, we recognize that the real estate valuations used to assess ability to pay may not be accurate. So in instances where the accuracy of local real estate valuations is in question or other unusual hardships exist, upon request, we will perform a second review of the real estate equity information to determine if accepting the offer is appropriate.

Expedited Levy Releases – Upon receipt of documentation supporting hardship reasons, we will speed the delivery of levy releases to the financial institution. Taxpayers seeking an expedited release for levies should contact their assigned representative at the phone number shown on the notice of levy to discuss available options.

Federal Treasury Offset Program (TOP) The TOP program is based on a reciprocal agreement between New Jersey and the federal government (FMS). FMS and New Jersey match debts (both tax and non-tax) against payments due to contract vendors. Ninety (90) days after we bill the taxpayer, we issue a Notice of Federal Set-Off to the taxpayer for unresolved debt, providing an additional 60 days to resolve it and prevent an offset. If after the sixty day time period the debt remains, the taxpayer’s federal refund will be offset to pay the New Jersey tax debt. Currently, the federal government imposes a $15 processing fee per transaction that is deducted from the refund amount.

State Reciprocal Set-Off We currently have reciprocal agreements with the States of Maryland, New York, and Connecticut whereby individual Income Tax refunds are set-off and sent to the state with an outstanding Income Tax liability for the taxpayer.

Release or Subordination of Tax Lien for Refinance or Foreclosure of Real Estate – Upon receipt of documentation supporting hardship reasons, we will speed the delivery of a Release of Lien or a Subordination of Lien. Taxpayers seeking such consideration should contact their assigned representative.

Last Updated: Tuesday, 06/16/20