diff --git a/changelog_entry.yaml b/changelog_entry.yaml
index e69de29bb2d..9bcccf34797 100644
--- a/changelog_entry.yaml
+++ b/changelog_entry.yaml
@@ -0,0 +1,4 @@
+- bump: minor
+  changes:
+    added:
+    - New Jersey TANF income eligibility.
diff --git a/policyengine_us/tests/policy/baseline/gov/states/nj/njdhs/tanf/nj_tanf_income_eligible.yaml b/policyengine_us/tests/policy/baseline/gov/states/nj/njdhs/tanf/nj_tanf_income_eligible.yaml
new file mode 100644
index 00000000000..fe03996a410
--- /dev/null
+++ b/policyengine_us/tests/policy/baseline/gov/states/nj/njdhs/tanf/nj_tanf_income_eligible.yaml
@@ -0,0 +1,54 @@
+- name: Household with no income is eligible. (0+0<1)
+  period: 2023
+  input:
+    state_code: NJ
+    nj_tanf_maximum_allowable_income: 1
+    nj_tanf_countable_earned_income: 0
+    nj_tanf_countable_gross_unearned_income: 0
+  output:
+    nj_tanf_income_eligible: true
+
+
+- name: Household with income exceeding maximum allowable income is ineligible. (1+1>1)
+  period: 2023
+  input:
+    state_code: NJ
+    nj_tanf_maximum_allowable_income: 1
+    nj_tanf_countable_earned_income: 1
+    nj_tanf_countable_gross_unearned_income: 1
+  output:
+    nj_tanf_income_eligible: false
+
+
+- name: Household with income equals maximum allowable income is eligible. (1+0=1)
+  period: 2023
+  input:
+    state_code: NJ
+    nj_tanf_maximum_allowable_income: 1
+    nj_tanf_countable_earned_income: 1
+    nj_tanf_countable_gross_unearned_income: 0
+  output:
+    nj_tanf_income_eligible: true
+
+- name: Household with income equals maximum allowable income and income equals maximum benefit is ineligible.
+  period: 2023
+  input:
+    state_code: NJ
+    nj_tanf_maximum_allowable_income: 1
+    nj_tanf_maximum_benefit: 1
+    nj_tanf_countable_earned_income: 1
+    nj_tanf_countable_gross_unearned_income: 0
+  output:
+    nj_tanf_income_eligible: false
+
+
+- name: Household with income less than maximum allowable income and income less than maximum benefit is eligible. 
+  period: 2023
+  input:
+    state_code: NJ
+    nj_tanf_maximum_allowable_income: 3
+    nj_tanf_maximum_benefit: 2
+    nj_tanf_countable_earned_income: 1
+    nj_tanf_countable_gross_unearned_income: 0
+  output:
+    nj_tanf_income_eligible: true
diff --git a/policyengine_us/variables/gov/states/nj/njdhs/tanf/nj_tanf_income_eligible.py b/policyengine_us/variables/gov/states/nj/njdhs/tanf/nj_tanf_income_eligible.py
new file mode 100644
index 00000000000..c7d2c7230a1
--- /dev/null
+++ b/policyengine_us/variables/gov/states/nj/njdhs/tanf/nj_tanf_income_eligible.py
@@ -0,0 +1,27 @@
+from policyengine_us.model_api import *
+
+
+class nj_tanf_income_eligible(Variable):
+    value_type = bool
+    entity = SPMUnit
+    label = "New Jersey TANF income eligible"
+    definition_period = YEAR
+    defined_for = StateCode.NJ
+
+    def formula(spm_unit, period, parameters):
+        income = add(
+            spm_unit,
+            period,
+            [
+                "nj_tanf_countable_earned_income",
+                "nj_tanf_countable_gross_unearned_income",
+            ],
+        )
+        maximum_allowable_income = spm_unit(
+            "nj_tanf_maximum_allowable_income", period
+        )
+        maximum_benefit = spm_unit("nj_tanf_maximum_benefit", period)
+        # New Jersey Administrative Code 10:90-3.1
+        return (income <= maximum_allowable_income) & (
+            income < maximum_benefit
+        )