New Jersey experienced a net outflow of nearly $2.8 billion in Individual Tax Return Adjusted Gross Income (AGI) for the tax year 2022-2023, according to data released by the Internal Revenue Service and announced on Apr. 10.
The shift in AGI is significant because it reflects the amount of taxable income leaving or entering the state, which has direct implications for New Jersey’s tax base and economic health. Policymakers are being urged to consider these trends as they address ongoing concerns about affordability and business climate.
NJBIA President and CEO Michele Siekerka said, “While there are always different outlooks on New Jersey’s broader population trends, New Jersey’s net loss of AGI continues to be a concern.” Siekerka also said, “The downstream economic effects of migration are not quite as simple as AGI-in versus AGI-out. But the potential loss of taxable income and available spending power in the state should very much be considered by policymakers as New Jersey continues to struggle with a lack of affordability, extremely high costs of living and business policies that make it more challenging for our job creators to thrive and provide careers.”
IRS figures show that from 2022-2023, approximately $14 billion in U.S. and foreign adjusted gross income left New Jersey while about $11.2 billion came into the state. This is an improvement over the previous year when outflows reached a record $17.6 billion against an inflow of $12.4 billion.
Former residents from New York contributed most positively to New Jersey’s AGI inflow at $5.11 billion during this period, followed by Pennsylvania ($1.39 billion), Florida ($785 million), California ($668 million), and Massachusetts ($318 million). The largest losses were seen with residents moving to New York (-$2.97 billion), Florida (-$2.96 billion), Pennsylvania (-$1.56 billion), California (-$821 million), and Texas (-$679 million).
NJBIA Research Analyst Jack Ramirez said, “Despite some broader losses, the New York pipeline is an overall net win for New Jersey,” noting that more than 73,000 people moved from New York into New Jersey compared with about 39,000 moving in the opposite direction: “Notably, New Jersey gained $5.1 billion in AGI from New York while losing nearly $3 billion. This $2.15 billion net gain reinforces New Jersey’s role as a key extension of the New York metro economy.” Ramirez added that Florida remains a top destination for those leaving: “Nearly 35,000 New Jersey residents relocated there, compared to just 14,000 moving north,” adding that Florida alone accounts for over 16% of total population loss due to its lower taxes and warmer weather.
The New Jersey Business and Industry Association serves as one of the nation’s largest statewide employer associations representing private-sector employers throughout all sectors across the state; it advances competitive excellence among members while delivering essential information services such as advocacy programs facilitating partnerships between businesses government entities academic institutions along with practical cost-saving benefits.
