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Division of Taxation

New Jersey College Affordability Act

Beginning with Tax Year 2022 (filed in 2023), the New Jersey College Affordability Act allows for three Income Tax deductions on New Jersey returns with a gross income of $200,000 or less. These deductions include contributions to NJBEST, payments made under NJCLASS, and tuition costs for New Jersey colleges and universities.

Contributions to a New Jersey Better Educational Savings Trust (NJBEST)

You can deduct up to $10,000 of contributions made during the year into an NJBEST account.

Example: You contribute $1,000 per month, beginning in January, and your gross income is $200,000 or less, you can deduct the maximum amount of $10,000.

Principal and Interest Paid on Student Loans under New Jersey College Loans to Assist State Students (NJCLASS)

You can deduct up to $2,500 of principal and interest paid on student loans during the year under NJCLASS if your gross income is $200,000 or less.

New Jersey Higher Education Institution Tuition Costs

If you, your spouse, or your dependent enroll in and attend a New Jersey institution of higher education, you can deduct up to $10,000 for tuition costs.

Applicable Laws and Rules

P.L. 2021, c.128


Last Updated: Wednesday, 04/20/22