Starting January 1, 2017, New Jersey implemented a new tax law that allows military veterans who were honorably discharged or released under honorable circumstances from active duty to be eligible for a $3,000 exemption on their NJ income tax return.
Claiming the Exemption
You must provide official documentation showing that you were honorably discharged or released under honorable circumstances from active duty the first time you claim the exemption. http://www.state.nj.us/treasury/taxation/pdf/veteransexemptionform.pdf
The most common form of documentation provided is a copy of your Certificate of Release or Discharge from Active Duty, DD-214. The United States National Archives and Records Administration (https://www.archives.gov/veterans/military-service-records) can assist with obtaining a copy of your DD-214.
You can certify for the exemption by sending your documentation and Veteran Exemption Submission Form to the New Jersey Division of Taxation before you file your tax return, which may help process your return faster.
Copy and paste on the link for more information http://www.state.nj.us/treasury/taxation/military/vetexemption.shtml