Provides gross income tax credit to qualified family caregivers for care and support expenses incurred for qualifying family members.

A5340

ASSEMBLY, No. 5340

STATE OF NEW JERSEY

222nd LEGISLATURE

�

INTRODUCED JUNE 28, 2026

Sponsored by:

Assemblyman� BRIAN BERGEN

District 26 (Morris and Passaic)

SYNOPSIS

���� Provides gross income tax credit to qualified family
caregivers for care and support expenses incurred for qualifying family
members.

CURRENT VERSION OF TEXT

���� As introduced.

��

An Act
providing a gross income tax credit to qualified family
caregivers for expenses paid or incurred to provide care for qualifying family
members and supplementing chapter 4 of Title 54A of the New Jersey Statutes.

����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:

���� 1.��� a.� A qualified family
caregiver shall be allowed a credit against the tax otherwise due under the
�New Jersey Gross Income Tax Act,� N.J.S.54A:1-1 et seq., in an amount equal to
the qualified care and support expenses paid or incurred by the qualified family
caregiver during the taxable year for a qualifying family member, not to exceed
$3,000 in a taxable year, or $5,000 in a taxable year if the qualifying family
member is a veteran or individual with a disability.

���� b.��� Except as otherwise
provided in subsection e. of this section, to claim the credit allowed pursuant
to this section, the qualified family caregiver shall attach documentation to
any return which the qualified family caregiver is required to file under N.J.S.54A:1-1
et seq., in a form and manner prescribed by the director, substantiating the
qualified care and support expenses paid or incurred by the qualified family
caregiver during the taxable year.� Such documentation shall include, but shall
not be limited to:

���� (1)�� itemized receipts or
invoices from service providers that clearly identify the qualifying family
member as the beneficiary;

���� (2)�� canceled checks, credit
card statements, or other proof of payment corresponding to the itemized
receipts or invoices;

���� (3)�� home modification
expenses, contracts and paid invoices detailing the nature of the modifications
and their purpose in supporting the qualifying family member;

���� (4)�� certification from a
licensed physician or licensed health care professional indicating the
necessity of assistive devices, medical equipment, or supplies for the care of
the qualifying family member;

���� (5)�� documentation that the qualifying
family member co-resides with the qualified family caregiver, which
documentation may include a caregiver log, affidavit, or other form of
verification as prescribed by the director; and

���� (6)�� any other additional
requirements and procedures the director deems necessary to prevent fraud and
ensure proper substantiation of qualified care and support expenses.

���� c.���� (1)� If a qualified family
caregiver is allowed a credit in accordance with subsection a. of this section
and, during the same taxable year, is allowed a dependent deduction in
accordance with paragraph 2 of subsection (b) of N.J.S.54A:3-1 for the
qualifying family member whose care and support is the basis for the credit
allowed in accordance with subsection a. of this section, the qualified family caregiver
shall be allowed to claim both the deduction and the credit in determining the
tax otherwise due for the taxable year under N.J.S.54A:1-1 et seq.

���� (2)�� If a qualified family caregiver
is allowed a credit in accordance with subsection a. of this section and,
during the same taxable year, is allowed a credit under N.J.S.54A:4-15 for the
qualifying family member whose care and support is the basis for the credit
allowed in accordance with subsection a. of this section, the qualified family caregiver
shall be allowed to claim both credits in determining the tax otherwise due for
the taxable year under N.J.S.54A:1-1 et seq.

���� d.��� If the credit allowed in
accordance with subsection a. of this section, together with any other payments
and any other credits, deductions, and adjustments allowed by law, reduces the
tax liability otherwise due for the taxable year under N.J.S.54A:1-1 et seq. to
zero, the amount of the credit remaining shall be paid to the qualified family
caregiver as a refund of an overpayment of tax in accordance with
N.J.S.54A:9-7; provided, however, that subsection (f) of that section,
concerning the allowance of interest, shall not apply.

���� e.���� A qualified family caregiver
who is not subject to tax in accordance with N.J.S.54A:2-4 for a taxable year
shall apply for the tax credit allowed under this section using an annual
application as shall be made available by the director, which application shall
be filed with the director on or before the date for filing annual gross income
tax returns.� The director shall determine the form and manner by which a
qualified family caregiver shall apply for a refund of an overpayment of tax,
and the time of the refund of the overpayment of tax.

���� f.���� In the event that two
or more qualified family caregivers provide care for the same qualifying family
member, the total amount of credit claimed by all qualified family caregivers
shall not exceed $3,000 in a taxable year, or $5,000 in a taxable year if the
qualifying family member is a veteran or individual with a disability.

���� g.��� As used in this section:

���� �Director� means the Director
of the Division of Taxation in the Department of the Treasury.

���� �Disability� means, with
respect to an individual, any medically documented physical or mental
impairment as defined in the federal �Americans with Disabilities Act of 1990,�
42 U.S.C. s.12101 et seq.���� �Licensed health care professional� means a
registered nurse, licensed practical nurse, advanced practical nurse, physician
assistant, physical therapist, occupational therapist, or dental hygienist
licensed pursuant to Title 45 of the Revised Statues.

���� �Licensed physician� means a
physician licensed by the State Board of Medical Examiners.

���� �Qualified care and support
expenses� means expenses paid or incurred by a qualified family caregiver for
the purchase, lease, or rental of tangible personal property and services that
are necessary to allow a qualifying family member to reside with the qualified
family caregiver, which property and services are provided: �to, or for the
benefit of, the qualifying family member; to assist the qualified family caregiver
in providing care and support to the qualifying family member; or by an
organization or an individual who is not a relative of the qualified family caregiver
or the qualifying family member.� �Qualified care and support expenses� shall
include, but shall not be limited to, expenses paid or incurred by a qualified family
caregiver for: �the purchase, lease, or rental of health care equipment or
supplies or assistive devices; home health agency services, adult day care,
companionship services, personal care attendant services, homemaker services,
respite care, or home modification services; services necessary to provide care
and support to a qualifying family member in connection with two or more activities
of daily living; or transportation services related to medical care or
obtaining qualified care and support services.� �Qualified care and support
expenses� shall not include expenses paid or incurred by a qualified family caregiver
that are reimbursed by insurance or by a program administered by the State or
federal government.

���� �Qualified family caregiver�
means a resident individual of this State who provides care and support to a
qualifying family member.

���� �Qualifying family member�
means an individual who: �is a relative of a qualified family caregiver; resides
with the qualified family caregiver as a member of the qualified family
caregiver�s household; and is 62 years of age or older, is a veteran, or is an
individual with a disability.

���� �Relative� means an individual
who is:� (1) related by blood or adoption, including a parent, grandparent,
great-grandparent, child, grandchild, great-grandchild, sibling, aunt, uncle,
niece, and nephew; (2) related through marriage, civil union, or domestic
partnership to an individual who is related by blood or adoption to one�s
spouse, including the same relationships as described in paragraph (1) of this
definition; or (3) an individual who has resided with the qualified family caregiver
as a member of the qualified family caregiver�s household for at least 12
consecutive months immediately preceding the taxable year.

���� "Veteran" means any
citizen and resident of this State honorably discharged or released under
honorable circumstances from active service in any branch of the Armed Forces
of the United States.

���� 2.��� This act shall take
effect immediately and apply to taxable years beginning on or after the January
1 next following the date of enactment.

STATEMENT

���� This bill provides a gross
income tax credit to qualified family caregivers who pay or incur qualified care
and support expenses for the care and support of a qualifying family member who
is 62 years of age or older, is a veteran, or is an individual with a
disability.

���� A qualified family caregiver
would be allowed to claim a gross income tax credit in an amount not to exceed
$3,000 in each taxable year for qualified care and support expenses paid or
incurred by the qualified family caregiver during the taxable year for the care
and support of a qualifying family member.� The maximum credit amount would be
$5,000 in each taxable year for a qualifying family member who is a veteran or
individual with a disability.� To claim the tax credit, the qualified family
caregiver would be required to provide documentation to substantiate that the
qualifying family member resides with the qualified family caregiver.� If
multiple caregivers provide care for the same individual, the total credit
cannot exceed $3,000 for all caregivers, or $5,000 for all caregivers if the
qualifying family member is a veteran or individual with a disability.

���� The credit may be claimed in
addition to the dependent deduction that may be received by the qualified
family caregiver for claiming the qualifying family member as a dependent on
the qualified family caregiver�s gross income tax return.� The credit may be
claimed in addition to the existing veteran care credit that may be available
to the qualified family caregiver under current law.� The bill also provides
that the tax credit would be refundable, meaning that if the credit reduces the
qualified family caregiver�s tax liability to an amount less than zero, the
remaining credit would be refunded to the caregiver as an overpayment of tax.�
The bill further provides that a qualified family caregiver is eligible to receive
the refundable credit, even if the caregiver has gross income below the
statutory minimum subject to tax.

���� The bill defines a �qualifying
family member� as an individual who:� (1) is a relative of a qualified family
caregiver; (2) resides with the qualified family caregiver as a member of the
qualified family caregiver�s household; and (3) is 62 years of age or older, is
a veteran, or is an individual with a disability.� A �relative� includes an individual
related by blood, adoption, marriage, civil union, or domestic partnership,
including a parent, grandparent, child, grandchild, great-grandchild, sibling,
aunt, uncle, niece, nephew, and step-relative, as well as an individual who has
resided with the caregiver for at least 12 consecutive months immediately
before the taxable year.� The bill defines �disability,� with respect to an
individual, as any medically documented physical or mental impairment as
defined in the federal �Americans with Disabilities Act.�� The bill also
defines �veteran� as any citizen and resident of this State honorably
discharged or released under honorable circumstances from active service in any
branch of the Armed Forces of the United States.

���� The bill defines �qualified
care and support expenses� as the expenses paid or incurred by a qualified
family caregiver for the purchase, lease, or rental of tangible personal
property and services that are necessary to allow a qualifying family member to
reside with the qualified family caregiver, which property and services are
provided:� to, or for the benefit of, the qualifying family member; to assist
the qualified family caregiver in providing care and support to the qualifying
family member; or by an organization or an individual who is not a relative of
the qualified family caregiver or the qualifying family member.� �Qualified
care and support expenses� also includes expenses paid or incurred by a
qualified family caregiver for:� the purchase, lease, or rental of health care
equipment or supplies or assistive devices; home health agency services, adult
day care, companionship services, personal care attendant services, homemaker
services, respite care, or home modification services; services necessary to
provide care and support to a qualifying family member in connection with two
or more activities of daily living; or transportation services related to
medical care or obtaining qualified care and support services.� However, expenses
paid or incurred by a qualified family caregiver that are reimbursed by
insurance or by a program administered by the State or federal government are
not considered �qualified care and support expenses.�