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Will we lose the retiree tax break?

Will we lose the retiree tax break?

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How does the New Jersey pension exclusion tax break apply? Tradition’s Michael Ciccone, CFP answers this question on NJ.com.

Q. Both my wife and I own a home in New Jersey and are quasi-government employees. Her pension is New Jersey and mine is New York. We are planning to move to Puerto Rico, where my wife owns a home, for retirement, and we plan to claim our residency there. Do we qualify for the tax break?
— Adios New Jersey!

A. Congrats on your retirement plans, but we’ve got some bad news for you.

You would not be able to use the New Jersey pension exclusion tax break as Puerto Rico residents, said Michael Ciccone, a certified financial planner with Tradition Capital Management in Summit.

“That law was passed in 2016 with the intent to help stem the exodus of retirees from New Jersey to states with more retiree-friendly tax codes,” Ciccone said. “The pension exclusion tax break is only available to New Jersey residents – these readers specify that they plan to become residents of Puerto Rico.”

But, Ciccone said, not all is lost.

Read the entire answer at NJ.com.

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