SENATE COMMITTEE SUBSTITUTE FOR

SENATE, No. 580

STATE OF NEW JERSEY

222nd LEGISLATURE

ADOPTED MAY 18, 2026

Sponsored by:

Senator  JAMES BEACH

District 6 (Burlington and Camden)

Senator  ROBERT W. SINGER

District 30 (Monmouth and Ocean)

Co-Sponsored by:

Senator Amato

SYNOPSIS

     Allows gross income tax deduction for certain student loan interest.

CURRENT VERSION OF TEXT

     Substitute as adopted by the Senate Higher Education Committee.

An Act allowing a gross income tax deduction for interest paid on certain student loans and supplementing chapter 3 of Title 54A of the New Jersey Statutes.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

     1.    a.  A taxpayer with gross income of $85,000 or less shall be allowed a deduction, not to exceed $2,500, from the taxpayer’s gross income for the taxable year in the amount of interest payments paid on a qualified education loan, other than interest paid on a student loan under the New Jersey College Loans to Assist State Students Program for which a deduction is allowed pursuant to section 4 of P.L.2021, c.128 (C.54A:3-13).

     b.  As used in this section, “qualified education loan” means any indebtedness incurred by the taxpayer solely to pay higher education expenses which are incurred on behalf of the taxpayer, the taxpayer’s spouse, or any dependent of the taxpayer at the time the indebtedness occurred.

     2.    This act shall take effect immediately and shall apply to taxable years beginning on or after the January 1 next following the date of enactment.