{"id":544,"date":"2012-06-10T20:21:23","date_gmt":"2012-06-10T20:21:23","guid":{"rendered":"http:\/\/ua-cpas.com\/blog\/?p=544"},"modified":"2012-06-10T20:21:23","modified_gmt":"2012-06-10T20:21:23","slug":"selling-investment-real-estate-in-new-jersey-beware-of-the-exit-tax","status":"publish","type":"post","link":"https:\/\/www.ua-cpas.com\/blog\/index.php\/2012\/06\/10\/selling-investment-real-estate-in-new-jersey-beware-of-the-exit-tax\/","title":{"rendered":"Selling Investment Real Estate in New Jersey? Beware of the \u201cExit Tax”"},"content":{"rendered":"

If you\u2019re a non-resident selling investment real estate in New Jersey, there\u2019s a unique NJ withholding tax you should be aware of. Both residents and non-residents always had to pay income tax on the gain upon the sale of real estate. This tax is required to be withheld for non-residents. \u00a0The \u201cExit Tax\u201d, which came into law six years ago, requires the seller to file a GIT\/REP form (Gross Income Tax form) in order to record a Deed for the transfer of his property. When a non-resident sells the property, New Jersey will withhold this income tax in the amount of either 8.97 percent of the profit or 2 percent of the total selling price, whichever is higher. Therefore, even if the property is sold at a loss<\/span>, tax must be withheld to fulfill the two percent requirement. When such a seller eventually files his NJ tax return he is refunded the difference between what was withheld and what was owed. <\/p>\n

So who\u2019s considered a \u201cresident\u201d and who\u2019s a \u201cnon-resident\u201d with regard to this tax? The law defines a resident taxpayer as one of the following:<\/p>\n