New Jersey retirement taxes in 2026: what retirees pay

New Jersey taxes income on a graduated scale, but it treats retirees more gently than its reputation might suggest. Social Security is left out of state income entirely. For people of a certain age whose total income stays under a set limit, a generous exclusion can take much of their pension, annuity and other retirement income out of the tax picture too. That exclusion gets smaller as income goes up and then ends, so the size of the household's total income matters a great deal here.

New Jersey retirement taxes at a glance (2026)

New Jersey income tax rates for 2026

Single filers 1:

Married couples filing jointly 1:

How New Jersey treats retirement income

At 62 or older, with total income up to $100,000, New Jersey excludes up to $100,000 of retirement income on a joint return ($75,000 single). Above that a smaller share is excluded, and above $150,000 of income none is. 3

What three retirees would pay in New Jersey

These are estimates from Monte Climb's planner on 2026 law, for three example households. They start, as the app does, from federal taxable income: the 2026 standard deduction plus the extra amount at 65 4, the taxable part of Social Security 5 and the senior deduction 6. Those federal deductions are already taken off, and most states allow less of their own, so New Jersey's real bill can be higher than shown.

• A single retiree, 67 with $54,000 of income would owe about $0 to New Jersey, after $75,000 of retirement income is excluded and $11,300 of taxable Social Security is left out.
• A married couple, both 67 with $106,000 of income would owe about $0 to New Jersey, after $100,000 of retirement income is excluded and $35,700 of taxable Social Security is left out.
• A married couple, both 62, before Social Security with $76,000 of income would owe about $0 to New Jersey, after $100,000 of retirement income is excluded.

The same couple next door

The married couple, both 67, with $106,000 of income, in New Jersey and the states around it:

Every figure here starts from federal taxable income, as above, so a state whose own deductions are smaller can tax more than shown.

What these estimates leave out

• New Jersey's own standard deduction, exemptions and credits: the estimate starts from federal taxable income instead, which takes off the larger federal deductions.
• City income taxes, and capital gains rules a state applies apart from its rate.
• Rules for military and public-employee pensions that some states treat separately.

What this means for your plan

In New Jersey, the most important thing is where your total income falls compared with the exclusion's limits. A household just under a limit and one just over it can owe quite different amounts of state tax on similar retirement savings. When you take withdrawals, how you mix income sources and whether you file jointly or single all shape the result. Monte Climb runs these New Jersey rules on your own plan year by year, so you can see how the exclusion applies to your income.

Sources

1. New Jersey income tax for 2026 (Monte Climb's audit grades it high)
2. New Jersey: a further official source for the 2026 tables
3. New Jersey's retirement-income rule: N.J.S.A. 54A:6-10
4. Rev. Proc. 2025-32 §4.14(1) and §4.14(3): the 2026 standard deduction and the additional amount at 65
5. IRC §86 and IRS Publication 915: how much of Social Security is taxable (thresholds set by statute, not indexed)
6. P.L. 119-21 (One Big Beautiful Bill Act) §70103: the $6,000 deduction for each person 65 or older, 2025–2028

Figures computed by code from Monte Climb's 2026 state tables (snapshot f024e17). An illustration, not tax advice.

Frequently asked questions

Does New Jersey tax Social Security?

In 2026, Social Security is not taxed in New Jersey.

What is New Jersey's income tax rate in 2026?

New Jersey has 7 brackets from 1.4% to 10.75% for 2026.

How much state tax would a retired couple pay in New Jersey?

A married couple, both 67, with $106,000 of Social Security, pension and IRA income would owe about $0 to New Jersey in 2026, by Monte Climb's estimate.