The Internal Revenue Service (IRS) said it will not tax the inflation relief payments some received as a check or refund in New Jersey in 2022.
The IRS had at first asked residents of New Jersey and multiple other states to hold off on filing their tax returns until it determined whether it will tax inflation relief payments as taxable income.
Such payments in New Jersey included the Middle Class Tax Rebate and the Individual Taxpayer Identification Number (ITIN) Direct Assistance Program.
Following a review, the agency made it official that it would not tax the payments made in New Jersey, California, Colorado, Connecticut, Delaware, Florida, Hawaii, Idaho, Illinois, Indiana, Maine, New Mexico, New York, Oregon, Pennsylvania, and Rhode Island.
Those payments will not be taxed because, as the IRS explains, they were made “for the promotion of the general welfare or as a disaster relief payment.”