Increases amount of child tax credit in taxable years 2026, 2027, and 2028.

S4531 FISCAL NOTE

FISCAL NOTE

SENATE, No. 4531

STATE OF NEW JERSEY

222nd LEGISLATURE

DATED: JULY 6, 2026

SUMMARY

Synopsis:

Increases amount of child tax credit in taxable years
2026, 2027, and 2028.�

Type of Impact:

A three-year State revenue decrease to the Property Tax
Relief Fund

Agency Affected:

Department of the Treasury

Executive
Estimate

Fiscal Impact

Fiscal Year 2027�

State Revenue Decrease

$50.0 million

Office of
Legislative Services Estimate

Fiscal Impact

FY 2027

FY 2028

FY 2029

FY 2030

State Revenue Decrease

$51.9 million

$50.3 million

$48.7 million

$0

�

The Office of Legislative Services (OLS)
generally agrees

with the Executive estimate that expanding child tax credit amounts by 25
percent will lower State revenue collections by $50.0 million in FY 2027.� The
OLS only projects a slightly larger impact in FY 2027 and extends its forecast
to the two additional fiscal years in which the tax credit expansion will be in
effect.

BILL DESCRIPTION

����� This bill increases by 25 percent the child tax credit
amounts under the gross income tax in tax years 2026, 2027, and 2028. �The refundable
credit is available to taxpayers with incomes of $80,000 or less and may be
claimed for each dependent child under age six.

Taxable Income

Current Credit

Credit Under Bill

$30,000 or under

$1,000

$1,250

over $30,000 but not over $40,000

$800

$1,000

over $40,000 but not over $50,000

$600

$750

over $50,000 but not over $60,000

$400

$500

over $60,000 but not over $80,000

$200

$250

FISCAL ANALYSIS

EXECUTIVE BRANCH

����� The Department of the Treasury estimates that this
bill will decrease State gross income tax collections by $50.0 million in FY
2027.

OFFICE OF LEGISLATIVE SERVICES

����� The OLS generally agrees with the Executive estimate
that expanding child tax credit amounts by 25 percent will lower State revenue
collections by $50.0 million in FY 2027.� The OLS only projects a slightly
larger impact in FY 2027 and extends its forecast to the two additional fiscal
years in which the tax credit expansion will be in effect.�

����� Specifically, the OLS estimates that the bill will
decrease State revenue collections by $51.9 million in FY 2027, $50.3 million
in FY 2028, and $48.7 million in FY 2029.

����� The OLS bases its estimate on data in the Department
of the Treasury�s FY 2027 Tax Expenditure Report.� In that publication,
Treasury states that 232,500 child tax credits were claimed for tax year 2024,
representing an FY 2025 State revenue loss of $220.7 million.� Treasury then projects
the revenue loss at $216.1 million for FY 2026 and $207.4 million for FY 2027.�

����� The OLS estimate of the bill�s FY 2027 revenue reduction
represents 25 percent of Treasury�s projection of the FY 2027 State revenue
loss from the child tax credit under current law parameters.� For FY 2028 and
FY 2029, the OLS deflates its estimate in line with recent utilization trends.�

Section:

Legislative Budget and Finance Office

Analyst:

Oscar Mendez

Revenue and Economic Policy Analyst

Approved:

Thomas Koenig

Legislative Budget and Finance Officer

This fiscal estimate has been prepared pursuant to P.L.1980,
c.67 (C.52:13B-6 et seq.).