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New Jersey Tax Law Questions & Answers
3 Answers | Asked in Tax Law and Real Estate Law for New Jersey on
Q: Do I have to pay capital gains tax on co-owned townhouse sale profit?

My daughter and I co-own a townhouse in New Jersey that has been her primary residence for the past four years. I contributed $170,000 towards the purchase price, and we are both listed on the deed. There is no mortgage, and my daughter has covered 100% of all expenses over the years. We are... View More

Leonard R. Boyer
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answered on May 18, 2025

Your plan after the sale to take back only what you put in is a personal decision. The profits will be subject to capital gains unless as a single person, when you file your tax return you have a $250,000 tax exemption.

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2 Answers | Asked in Consumer Law, Civil Litigation and Tax Law for New Jersey on
Q: Insurance agent facing high loan interest rates, considering legal action for usury.

I am an insurance agent in New Jersey and purchased a book of business in 2020, financing it through a loan from a company owned by my insurance carrier. The loan's interest rate started at 11% and has risen to 14.83%, yet my monthly payments predominantly cover interest rather than principal.... View More

Tim Akpinar
Tim Akpinar
answered on May 18, 2025

While New Jersey attorneys who work in credit/lending/banking could advise best here as to exact percentage figures, it might not hurt to review the overall contract language and provisions, in terms of its accuracy with representations about the book of business or other features, such as... View More

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1 Answer | Asked in Tax Law and Gov & Administrative Law for New Jersey on
Q: Are commercial truck repairs for a solid waste fleet tax-exempt in NJ?

I own a solid waste hauling business in New Jersey, operating exclusively within the state with a fleet of six trucks, each weighing over 80,000 lbs. I've been paying taxes on commercial truck repairs but was informed that they might be exempt due to the fleet size and truck weight. I... View More

James L. Arrasmith
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answered on May 15, 2025

Yes, commercial truck repairs may be tax-exempt in New Jersey under certain conditions, especially when the trucks are part of a qualified solid waste or commercial motor vehicle fleet. According to New Jersey tax regulations, repairs and replacement parts for certain motor vehicles—such as those... View More

1 Answer | Asked in Tax Law, Contracts and Civil Litigation for New Jersey on
Q: Can I sue a tax preparer for not completing my taxes after payment in New Jersey?

I hired a tax preparer, paid them $70, and was promised that my tax filing would be completed before the deadline. However, they failed to complete the service, and I was never informed that it was done. Can I take legal action against them, and what claims might I have in this situation?

James L. Arrasmith
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answered on May 15, 2025

Yes, you can take legal action against the tax preparer in New Jersey if they failed to perform the service you paid for. This falls under a basic breach of contract—when one party pays for a service and the other party does not deliver as agreed. Even though the amount is relatively small, you... View More

1 Answer | Asked in Estate Planning and Tax Law for New Jersey on
Q: Is an Arizona revocable trust valid in New Jersey for tax purposes?

I created a revocable trust in Arizona in 2019, and I am now a resident of New Jersey with no change in residency since its creation. My main concern is whether this trust remains valid in New Jersey, especially for tax purposes, and if there are any implications or actions needed to ensure its... View More

James L. Arrasmith
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answered on Apr 12, 2025

Your revocable trust created in Arizona should remain valid in New Jersey, as long as it was properly established in accordance with Arizona laws. The primary concern is whether your trust complies with New Jersey's tax rules, particularly regarding how it treats income, property, and estate... View More

1 Answer | Asked in Tax Law and Real Estate Law for New Jersey on
Q: What does removed taxation board judgment mean?

In 2021, I received a judgment from the taxation board regarding the assessment of my property. Recently, the tax assessor informed me that this judgment has been removed. There was no explanation provided, and there are no pending appeals or disputes related to this assessment. What does it mean... View More

James L. Arrasmith
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answered on Apr 12, 2025

When a taxation board judgment is removed, it usually means that the ruling or decision made by the board regarding the property assessment has been reversed, vacated, or no longer applies. This could happen for several reasons, such as a settlement, an administrative error, or a decision by the... View More

2 Answers | Asked in Tax Law, Social Security, Business Formation, Public Benefits and Business Law for New Jersey on
Q: What to do about not filing income taxes for three years in NJ?

I have not filed my income taxes for the past three years due to personal circumstances, including dealing with addiction and caring for my ill wife. I collect Social Security benefits and have a small business but have kept no records of income or expenses. I have received notices from the IRS... View More

Leonard R. Boyer
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answered on Mar 26, 2025

You need to retain either an experienced tax law attorney or a CPA who practices tax accounting. You have a reasonable explanation for why you did not file. Either the attorney or CPA can work out an offer and compromise. I do not think there will be any problem to work an offer and compromise with... View More

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1 Answer | Asked in Tax Law for New Jersey on
Q: Can I file a 2022 NJ tax return for a refund without late penalty if I wasn't required to file?

I was not required to file a tax return for New Jersey in 2022 due to my income level. I have not received any communication from New Jersey tax authorities about filing a return. I realized a few months ago that I might be eligible for a refund. Can I file my return now to claim a refund without... View More

James L. Arrasmith
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answered on Apr 12, 2025

Yes, you can file your 2022 New Jersey tax return now to claim a refund without incurring a late filing penalty. Since you were not required to file a return due to your income level, and no tax was due, there is no penalty for filing late when seeking a refund. New Jersey law allows taxpayers to... View More

1 Answer | Asked in Foreclosure and Tax Law for New Jersey on
Q: Is foreclosure legal after tax certificate redemption before filing?

I received a notice from a tax lien holder's lawyer with a 30-day deadline to redeem a tax certificate or face foreclosure. I redeemed the certificate at the tax collector's office within 24 days and received a receipt, but this was after the 2-year redemption period had ended. However,... View More

Leonard R. Boyer
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answered on Mar 9, 2025

Unless you have a consultation with an experienced mortgage foreclosure defense attorney, it is impossible to know if you are correctly stating what the legal pleading you received actually is. If the two year redemption period has ended then it was too late to redeem the tax lien certificate.... View More

1 Answer | Asked in Foreclosure, Tax Law, Real Estate Law and Consumer Law for New Jersey on
Q: Can a lien holder charge a foreclosure fee if property isn't in foreclosure?

I had a tax lien on my property, and the lien holder sent me a notice to pay within 30 days to avoid foreclosure. I paid before the deadline and have proof of the payment date, but the lien holder charged me a foreclosure fee anyway, which was added to the redemption amount at the tax office. The... View More

Leonard R. Boyer
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answered on Mar 4, 2025

No! That is not a valid charge. You need to consult an experienced mortgage foreclosure defense attorney and have the entire loan record. Good luck.

1 Answer | Asked in Divorce, Real Estate Law and Tax Law for New Jersey on
Q: Can my ex husband's future creditors put a lien on our former home that is in my name only?

If my ex husband is taken off the deed to the house in our divorce, but the agreement reads he is entitled to a portion of the proceeds if and when i decide to sell, can a lien be put on the house in the future from his creditors?

Anthony M. Avery
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answered on Jan 23, 2025

If there is no deed recorded from him to you, then both it. The divorce has nothing to do with third parties. Creditors could get a judgment against him, then collect against any asset he has including the divorce term to share in sale proceeds without a filed judgment lien.

2 Answers | Asked in Tax Law for New Jersey on
Q: does the extra 20% trustee commission in NJ have to be split if there are 2 trustees
Leonard R. Boyer
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answered on Jan 21, 2025

No one can understand what you are talking about. You put this under Tax Law, but without more facts, this does not make any sense.

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1 Answer | Asked in Tax Law for New Jersey on
Q: In NJ, Can an unclaimed property check for an LLC be intercepted by the state if a member of LLC owned back state tax?

I have IRS and State tax debt and property liens that I'm working through. I found $5000 in unclaimed property funds with the State of NJ. I followed the process, and they sent the check, but it was intercepted by "SOIL", and kept due to the back taxes owed.

I have 5+... View More

James L. Arrasmith
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answered on Dec 21, 2024

In New Jersey, the state can intercept unclaimed property checks if the claimant has outstanding tax debts. Since you are a member of the LLC, especially if you are the sole member, your personal tax liabilities might be linked to the business funds, increasing the chance of interception.... View More

1 Answer | Asked in Business Law and Tax Law for New Jersey on
Q: I own six e-commerce stores that run themselves. I rent them out. is this unearned passive income?

The people who rent them out. Order all the products and they ship out all the orders. I host the website and every 4 years I pay for the hosting fee. I do not do any work on the sites. They stay the same.

James L. Arrasmith
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answered on Oct 14, 2024

Yes, the income you receive from renting out your e-commerce stores is generally considered unearned passive income. Since you’re not actively involved in the daily operations, managing orders, or shipping products, your role is limited to owning the assets and handling minimal tasks like hosting... View More

1 Answer | Asked in Tax Law for New Jersey on
Q: How does NJ treats In-Plan ROTH conversion?

Hello,

I have an active 403(b) retirement account to which I am still contributing. All new contributions are ROTH. Previously I had tax deferred (non ROTH) contribution to this account.

Let us say, total tax deferred contribution over several years in the past is $25,000.00 and... View More

James L. Arrasmith
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answered on Oct 7, 2024

When you convert your tax-deferred portion of the 403(b) to a Roth in New Jersey, the growth of $15,000 will generally be considered taxable income for NJ in the year of conversion. This is because, while you have already paid NJ taxes on your contributions, you haven’t paid tax on the growth,... View More

1 Answer | Asked in Tax Law, Entertainment / Sports and Gaming for New Jersey on
Q: I need legal guidance on prize distribution and tax compliance for U.S. players in an skill based esport tournament

I'm developing a battle royale game similar to PUBG or Fortnite with Free-to-Play and Pay-to-Play tournament modes. In the Pay-to-Play mode, players pay a $50 registration fee, creating a $5,000 prize pool. Prizes include $1,000 for the winner, and $25 per kill and $30 per headshot, awarded... View More

James L. Arrasmith
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answered on Sep 25, 2024

In the U.S., you are generally required to issue a 1099-MISC form to players who earn $600 or more in a calendar year from your tournament. While you can include a disclaimer in your terms making players responsible for reporting and paying their taxes, the burden of reporting still falls on you... View More

1 Answer | Asked in Tax Law for New Jersey on
Q: Noticed our property tax card has a second story listed twice and a fireplace listed which we don't have either

On the residential cost approach section of our property card their is a half story and unfinished half story listed however we only have an attic. We also noticed their is a fireplace listed which we also don't have. Our story height is listed as 1.5 story however the building description is... View More

James L. Arrasmith
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answered on Aug 13, 2024

It sounds like your property card has some discrepancies that could be affecting your tax assessment. If your property card incorrectly lists a second story, unfinished half-story, and a fireplace that you don't have, you should address this with your local tax assessor's office. These... View More

1 Answer | Asked in Tax Law for New Jersey on
Q: How Do You Account For Art As A Nonprofit If The Donor Chooses Not To Deduct It?

I own a nonprofit and a friend of mine will be donating 4 paintings he made that are worth over 50k, and he's choosing not to deduct them. I know to put this under schedule M of the 990, but because he's choosing not to deduct them, I'm not sure if I should go get them appraised or... View More

James L. Arrasmith
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answered on May 5, 2024

Even if the donor chooses not to claim a tax deduction for the donated artwork, it's still a good practice for your nonprofit to properly document and record the donation. Here's what you should consider:

1. Acknowledgment: Provide the donor with a written acknowledgment of the...
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1 Answer | Asked in Tax Law for New Jersey on
Q: For nonprofits, is there any special tax procedure in regard to very high-value In-kind donations?

I own a nonprofit and a friend of mine will be donating 4 paintings he made that are worth over 50k, and he's choosing not to deduct them. I know to put this under schedule M of the 990, but because he's choosing not to deduct them, I'm not sure if I should go get them appraised or... View More

James L. Arrasmith
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answered on May 5, 2024

For nonprofits receiving high-value non-cash (in-kind) donations, there are some special considerations and procedures to follow:

1. Acknowledgment: The nonprofit should provide a written acknowledgment to the donor, describing the donated property and specifying whether any goods or...
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1 Answer | Asked in Tax Law for New Jersey on
Q: Tax Filing as F-1 Student

I am F-1 student in the US since 2022. I have been working full time on my CPT. While filing my returns, what occupation should I put? Please guide in this regards. Thank you!

James L. Arrasmith
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answered on Apr 13, 2024

As an F-1 student working on Curricular Practical Training (CPT), your occupation for tax purposes should reflect the nature of your work rather than your student status. Here's what you should consider:

1. Occupation: Choose the occupation that best describes the work you performed...
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