New Jersey Property Tax Overview

Keywords: New Jersey property tax, property tax in New Jersey, New Jersey property tax rate

---

1. Key Statistics

Sources: According to the U.S. Census Bureau's American Community Survey (ACS) (5‑year estimates, 2023).

---

2. How Property Tax Is Calculated in New Jersey

1. Assessed Value: Municipal assessors determine the assessed value of a property, generally a percentage of its market value.
2. Tax Rate (Millage): Local governments (county, municipality, school districts, and special districts) set a tax rate expressed in dollars per $100 of assessed value.
3. Effective Tax Rate: The effective property tax rate is the ratio of the total annual tax bill to the market value of the property. In New Jersey the 2023 effective rate is 2.23 %.

Because the tax rate is set by multiple jurisdictions, the property tax rate can vary by county and even by municipality within the same county.

---

3. Example Tax Bills (2026)

Using the statewide effective tax rate of 2.23 %:

These figures are calculated as:

[ \text{Annual Tax} = \text{Home Value} \times 0.0223 ]

---

4. Comparison to the National Average

• Effective tax rate: New Jersey’s 2.23 % is 130.58 % higher than the national average of 0.97 %.
• Ranking: With the highest effective rate among all 50 states and U.S. territories, New Jersey ranks #52 out of 52.

The higher rate reflects New Jersey’s reliance on property taxes to fund local services, including public schools, municipal operations, and county services.

---

5. Variation by County

Property tax rates are not uniform across the state. For example:

(Exact rates differ yearly and depend on local budget decisions.) Residents should consult the county tax assessor’s office or the municipal tax collector for precise rates applicable to a specific property.

---

6. Implications for Specific Property Owners

Retirees

• Tax burden: The high effective rate means retirees may face larger property tax obligations relative to home value.
• Potential relief: Some municipalities offer senior citizen property tax exemptions or rebates subject to income and residency criteria. Eligibility varies by county and municipality.

Landlords

• Operating costs: Landlords must incorporate the higher property tax into rent calculations to maintain profitability.
• Tax deductions: Property taxes are generally deductible as a business expense on federal income tax returns for rental properties, which can offset part of the cash outlay.

Both groups should evaluate the overall tax liability in conjunction with other local taxes and fees when assessing the affordability of owning property in New Jersey.

---

7. Frequently Asked Questions

---

8. Summary

According to U.S. Census Bureau data, New Jersey’s median home value is $427,600, and the effective property tax rate stands at 2.23 %, producing a median annual tax bill of $9,541. This rate is the highest among U.S. states and territories, exceeding the national average by more than 130 %. Property tax rates are determined locally and therefore vary by county and municipality. Prospective retirees and landlords should consider the higher tax burden, as well as any available exemptions or deductions, when evaluating property ownership in New Jersey.