New Jersey Governor Phil Murphy announced today that New Jerseyans with retirement income can now use New Jersey’s Direct File program.

DirectFile.nj.gov launched January 28, and this update makes the online tool available to roughly 400,000 more residents. Eligible New Jerseyans can benefit from this free and secure way to file federal and state individual tax returns, along with live chat support.

New Jerseyans may qualify to use Direct File this tax season if they lived in the state for all of 2024, earned all 2024 income in New Jersey, make below certain income thresholds, and plan to use the same filing status for both federal and state income tax returns. With the new update, the tool will support more filers with distributions from employer-sponsored pension and retirement accounts – like a 401(k), pension, annuity, 403(b), or governmental 457(b) – who typically receive 1099-R forms.

New Jersey Direct File is a part of the federal IRS Direct File program.

The tool’s rollout and expansion resulted from the collaboration between the State’s Department of Treasury and Office of Innovation, in partnership with the nonprofit organization Code for America.

Direct File helps minimize the taxpayer burden for filing, which is estimated by the IRS to be valued at around $160 for individual or nonbusiness filers.

Notably, eligible residents who use this tool are automatically enrolled in money-saving tax credits, like the Earned Income Tax Credit and Child Tax Credit.

The IRS Direct File pilot program was initiated successfully in 12 states last year, with 140,000 taxpayers claiming more than $90 million in refunds and saving an estimated $5.6 million in filing fees.