Last year, the State of New Jersey introduced a pilot program to improve the convenience of paying taxes; through the NJ Tax Portal, a new service allows users to file directly with the state’s division of taxation. Due to the initial success of the pilot, the tax portal will soon undergo maintenance updates to advance the program for state-wide use. The phases of implementation will progressively allow more types of state taxes to be paid through the tax portal as the updates are completed. The State has also issued notices that outline when filing services will be unavailable during these implementation periods.
Who Qualifies to File Directly Through the Tax Portal
Both individuals and corporations will be eligible to file directly. Direct individual tax filing will not be possible until phase three of the tax portal’s updates are complete. As an individual, you must have lived in the state of New Jersey for the entire duration of the filing tax year, earned your entire income in the State of NJ, and plan to use the same filing status for both state and federal tax returns. Additionally, you may not be eligible to file directly as an individual if portions of your income are from certain unsupported sources, such as gig work or unreported cash income, alimony, or more. To check eligibility, use this link posted on the NJ Treasury Department’s website (directs to the IRS’ website).
The creation of an account in the improved NJ tax portal is not a requirement to file taxes directly. However, it is highly recommended to create an account to have access to account history, secure storage of documentation, and expedited processing and assistance. Tax preparers – such as Bowman & Company LLP – must have separate NJ tax portal accounts than the individuals and businesses that are filing state taxes. Filers must grant “delegate” access to their tax preparers. Once this has occurred, tax preparers will be qualified to utilize NJ tax portal services on behalf of their clients.
While this tool is useful especially for individuals with basic filing, it is in your best interest to investigate the eligibility requirements, to review your income sources, and to speak with your accountant before filing directly with complete independence. Additionally, the state will issue user guides, FAQ’s, and videos related to all changes made to the improved NJ tax portal features.
What Phases Are Planned?
Phase one of the direct file modernization project is entirely comprised of 20 different state business taxes, and does not include individual state income tax. The full list of state taxes involved are listed on the NJ Division of Taxation’s website, as well as a detailed breakdown of all other planned phases. In total, there are 5 phases of implementation.
Scheduled Maintenance and Timeline
As of now, the only phase with a designated date of implementation is phase one. Starting April 26 2025, online filing and payment systems will be temporarily unavailable, and the telephone-based NJ sales tax filing system will be permanently discontinued. Direct filing services for returns and payment types outlined in Phase one will be available on May 14 2025. All returns and payment types due during the month of May – affected by the maintenance of phase one – will be granted a 30 day extension (from the original due date) without penalty or interest. An overview of the information above can be found here on the NJ Division of Taxation website.
Sources & More Information
- New Jersey Division of Taxation: “Direct File” – https://www.nj.gov/treasury/taxation/direct-file-nj.shtml
- New Jersey Division of Taxation: “Major Upgrades to the NJ Tax-Filing System” – https://www.nj.gov/treasury/taxation/taxportal/index.shtml
- United States Internal Revenue Service: “Direct File” – https://directfile.irs.gov/