New Jersey · Casualty and Theft Losses
Casualty and Theft Losses in New Jersey (2026)
Casualty and theft losses from federally declared disasters are deductible after reducing by $100 per event and 10% of AGI. Business casualty losses remain fully deductible regardless of disaster declaration. New Jersey has a progressive income tax with a top rate of 10.75%, so a New Jersey filer's combined marginal rate on the next dollar at $93,851 of income is about 28.37% (22% federal + 6.37% NJ).
2026 savings example for New Jersey
Planning estimate for a single filer earning $93,851 (New Jersey median household income in LevyIO's state dataset) who removes $5,000 from taxable income. Federal tax uses the 2026 IRS brackets after the $16,100 standard deduction; NJ tax uses the state brackets in LevyIO's dataset and assumes the state follows the federal treatment.
Estimated total savings
$1,419
Federal savings
$1,100
$11,817 → $10,717 · 22% bracket
NJ state savings
$319
$3,852 → $3,534 · 6.37% marginal
Combined marginal rate
28.37%
≈ $284 saved per $1,000 deducted
Federal × New Jersey marginal rates (2026, single)
Gross-income ranges include the federal standard deduction. The NJ column is the state marginal rate at the midpoint of each range. The last column is the tax saved per $1,000 deducted at that combined rate.
| Federal bracket | Gross income (single) | NJ marginal | Combined | Per $1,000 |
|---|---|---|---|---|
| 10% | $16,100 - $28,500 | 1.75% | 11.75% | $118 |
| 12% | $28,500 - $66,500 | 5.53% | 17.52% | $175 |
| 22% | $66,500 - $121,800 | 6.37% | 28.37% | $284 |
| 24% | $121,800 - $217,875 | 6.37% | 30.37% | $304 |
| 32% | $217,875 - $272,325 | 6.37% | 38.37% | $384 |
| 35% | $272,325 - $656,700 | 6.37% | 41.37% | $414 |
| 37% | Over $656,700 | 8.97% | 45.97% | $460 |
Eligibility & forms
Available to individuals who suffer losses from federally declared disasters. Since 2018, personal casualty losses are only deductible if attributable to a federally declared disaster.
- Loss must result from a federally declared disaster
- Must reduce loss by insurance reimbursements
- Each casualty loss must exceed $100
- Total losses must exceed 10% of AGI
Federal forms: Form 4684, Schedule A
New Jersey filing notes
No standard deduction. Property taxes average over $9,000 annually for many homeowners, so ANCHOR, Senior Freeze, and Stay NJ property tax relief can matter more than small income tax changes. Social Security is not taxed by New Jersey, and retirement income exclusions may apply if income is below state thresholds.
Common mistakes: Claiming losses not from federally declared disasters; Not filing insurance claims before taking deduction; Incorrect valuation of damaged property; Missing the deadline to amend returns for disaster losses.
Frequently asked questions
How much can the Casualty and Theft Losses save a New Jersey taxpayer in 2026?
In LevyIO's example, a single filer with $93,851 of income (the New Jersey median household income in our state dataset) who removes $5,000 from taxable income saves about $1,100 in 2026 federal tax (22% marginal bracket) plus about $319 in New Jersey tax (6.37% state marginal rate), roughly $1,419 combined. It is a planning estimate computed from the 2026 IRS brackets and LevyIO's NJ bracket data, not a survey figure.
What is the New Jersey income tax rate for 2026?
New Jersey has a progressive income tax with a top rate of 10.75%. The NJ standard deduction in LevyIO's dataset is $0 single / $0 married. Highest property taxes (2.23%). Top rate 10.75%. Inheritance tax still applies to some beneficiaries, but the state estate tax no longer applies to recent deaths. No standard deduction.
Who qualifies for the Casualty and Theft Losses in New Jersey?
Available to individuals who suffer losses from federally declared disasters. Since 2018, personal casualty losses are only deductible if attributable to a federally declared disaster.. The federal rules are the same in every state; the requirements are: Loss must result from a federally declared disaster; Must reduce loss by insurance reimbursements; Each casualty loss must exceed $100; Total losses must exceed 10% of AGI. New Jersey filers should confirm on the NJ return whether the state follows the federal treatment.
Which forms do I file to claim the Casualty and Theft Losses?
Federal: Form 4684, Schedule A. New Jersey: check the New Jersey Division of Taxation instructions for the matching state schedule. Common mistakes: Claiming losses not from federally declared disasters; Not filing insurance claims before taking deduction; Incorrect valuation of damaged property; Missing the deadline to amend returns for disaster losses.
Casualty and Theft Losses in other states
Sources
Reviewed 2026-09-17. Estimates are educational planning figures computed from the IRS 2026 inflation adjustments and LevyIO's state bracket dataset; they are not tax advice.