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Home Energy Tax Credit in New Jersey 2026

Calculate your home energy tax credit tax savings in New Jersey. With New Jersey's 10.75% top state tax rate, your combined savings are higher.

New Jersey Tax Overview

State Income Tax
10.75%
progressive
Sales Tax
6.625%
avg combined: 6.6%
Property Tax Rate
2.23%
Median Income
$93,851

Highest property taxes (2.23%). Top rate 10.75%. Both estate AND inheritance tax. No standard deduction.

New Jersey Income Tax Brackets (Single)

1.4%
$0 - $20,000
1.75%
$20,000 - $35,000
3.5%
$35,000 - $40,000
5.525%
$40,000 - $75,000
Your bracket
6.37%
$75,000 - $500,000
Your bracket
8.97%
$500,000 - $1,000,000
10.75%
$1,000,000 +
$3,200
Est. Total Savings
$3,200
Max Deduction
Tax Credit
Deduction Type
28.4%
Combined Tax Rate

Home Energy Tax Credit Savings Calculator for New Jersey

$
$

Federal Savings

$3,200

22% bracket

New Jersey State

$0

6.37% rate

Total Savings

$3,200

28.4% combined

Tax credits reduce your tax bill dollar-for-dollar, regardless of your tax bracket.

Savings by Tax Bracket in New Jersey

10%
$5,000
12%
$5,000
22%
$5,000
24%
$5,000
32%
$5,000
35%
$5,000
37%
$5,000

Includes 6.37% New Jersey state tax on top of federal savings.

Eligibility Requirements

Homeowners who install energy-efficient improvements

  • 1Must be primary residence
  • 2Qualifying improvements only
  • 3Keep receipts

New Jersey residents should verify that this deduction is also recognized on their state tax return for additional savings of up to 10.75%.

Common Mistakes to Avoid

  • !Claiming for rental properties
  • !Missing manufacturer certifications
  • !Forgetting to claim the deduction on your New Jersey state return (missing up to 10.75% additional savings)

New Jersey Filing Tips

No standard deduction. Property taxes average over $9,000 annually. Both estate and inheritance taxes apply. NJ offers FAIR rebate for property tax relief.

Required Tax Forms

Form 5695

File these forms with your federal tax return to claim the home energy tax credit. New Jersey may require additional state-specific forms.

Other Tax Deductions in New Jersey

Mortgage Interest Deduction

Housing

~$4,513
est. savings

Property Tax Deduction

Housing

~$2,837
est. savings

Home Office Deduction

Housing

~$1,547
est. savings

Residential Solar Tax Credit

Housing

~$7,500
est. savings

Military Moving Expenses

Housing

~$5,158
est. savings

PMI Premium Deduction

Housing

~$1,419
est. savings

Mortgage Points Deduction

Housing

~$2,579
est. savings

Casualty & Theft Loss Deduction

Housing

~$6,448
est. savings

Home Energy Tax Credit in Neighboring States

New York

10.9% top rate (progressive)

~$1,800
-1,400 vs New Jersey

Pennsylvania

3.07% top rate (flat)

~$1,800
-1,400 vs New Jersey

Delaware

6.6% top rate (progressive)

~$1,800
-1,400 vs New Jersey

Tax Calculators for New Jersey Cities

NewarkJersey CityPatersonElizabethEdisonLakewoodWoodbridgeToms RiverTrentonClifton

Calculate Your Full Tax Savings in New Jersey

Use our free tax calculators to optimize your entire tax return for New Jersey.

Income Tax CalculatorNew Jersey Income TaxFull Home Energy Tax Credit Guide

Frequently Asked Questions

How much can I save with the Home Energy Tax Credit in New Jersey?

In New Jersey, the home energy tax credit can save you an estimated $3,200 per year on a $5,000 deduction. This includes $3,200 in federal tax savings and $0 in New Jersey state tax savings at the 6.37% marginal rate. The national average savings is $1,800/year.

What is the New Jersey state income tax rate?

New Jersey has a progressive income tax system with a top rate of 10.75%. Highest property taxes (2.23%). Top rate 10.75%. Both estate AND inheritance tax. No standard deduction.

Who qualifies for the Home Energy Tax Credit in New Jersey?

Homeowners who install energy-efficient improvements. The eligibility requirements are the same whether you live in New Jersey or another state, as this is a federal tax credit. However, your total savings will vary based on New Jersey's 10.75% top state tax rate.

What tax forms do I need to claim the Home Energy Tax Credit in New Jersey?

To claim the home energy tax credit, you need to file Form 5695 with your federal return. New Jersey residents should also check if the state allows this deduction on their state return for additional savings of up to 10.75%. Filing status affects your deduction limits and tax bracket.

Is the Home Energy Tax Credit better in New Jersey than in states without income tax?

Yes, New Jersey residents benefit more because the state's 10.75% top income tax rate means the deduction reduces both your federal AND state tax liability. In states with no income tax (like Texas, Florida, or Nevada), this deduction only reduces federal taxes. Your combined rate of 28.4% means more savings per dollar deducted.

What is the standard deduction in New Jersey for 2026?

New Jersey's standard deduction is $0 for single filers and $0 for married filing jointly. No standard deduction. Property taxes average over $9,000 annually. Both estate and inheritance taxes apply. NJ offers FAIR rebate for property tax relief.

Related Calculators

Mortgage Interest Deduction in New Jersey

Avg savings: $3,500/year

Property Tax Deduction in New Jersey

Avg savings: $2,200/year

Home Office Deduction in New Jersey

Avg savings: $1,200/year

Residential Solar Tax Credit in New Jersey

Avg savings: $7,500/year

Military Moving Expenses in New Jersey

Avg savings: $4,000/year

PMI Premium Deduction in New Jersey

Avg savings: $1,100/year