SENATE BILL 6

49th legislature - STATE OF NEW MEXICO - second special session, 2010

INTRODUCED BY

Bernadette M. Sanchez

AN ACT

RELATING TO REVENUE; IMPOSING A SURTAX OF ONE PERCENT ON HIGH-INCOME NEW MEXICO TAXPAYERS.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

     Section 1. Section 7-2-7 NMSA 1978 (being Laws 2005, Chapter 104, Section 4) is amended to read:

     "7-2-7. INDIVIDUAL INCOME TAX RATES.--The tax imposed by Section 7-2-3 NMSA 1978 shall be at the following rates for any taxable year beginning on or after January 1, 2008:

          A. For married individuals filing separate returns:

     If the taxable income is:       The tax shall be:

Not over $4,000                       1.7% of taxable income

Over $ 4,000 but not over $ 8,000   $ 68.00 plus 3.2% of excess over $ 4,000

Over $ 8,000 but not over $ 12,000   $ 196 plus 4.7% of  excess over $ 8,000

Over $ 12,000                         $ 384 plus 4.9% of  excess over $ 12,000.

          B. For heads of household, surviving spouses and married individuals filing joint returns:

     If the taxable income is:       The tax shall be:

Not over $8,000                       1.7% of taxable income

Over $ 8,000 but not over $ 16,000   $ 136 plus 3.2% of                                        excess over $ 8,000

Over $ 16,000 but not over $ 24,000   $ 392 plus 4.7% of                                        excess over $ 16,000

Over $ 24,000                         $ 768 plus 4.9% of  excess over $ 24,000.

          C. For single individuals and for estates and trusts:

     If the taxable income is:       The tax shall be:

Not over $5,500                       1.7% of taxable income

Over $ 5,500 but not over $ 11,000   $ 93.50 plus 3.2% of excess over $ 5,500

Over $ 11,000 but not over $ 16,000   $ 269.50 plus 4.7% of excess over $ 11,000

Over $ 16,000                         $ 504.50 plus 4.9% of excess over $ 16,000.

          D. The tax on the sum of any lump-sum amounts included in net income is an amount equal to five multiplied by the difference between:

                (1) the amount of tax due on the taxpayer's taxable income; and

                (2) the amount of tax that would be due on an amount equal to the taxpayer's taxable income and twenty percent of the taxpayer's lump-sum amounts included in net income.

          E. The tax imposed by Section 7-2-3 NMSA 1978 is increased by a surtax imposed at the rate of one percent on taxable income in excess of:

                (1) eighty thousand dollars ($80,000) for married individuals filing separate returns;

                (2) one hundred sixty thousand dollars ($160,000) for heads of household, surviving spouses and married individuals filing joint returns; or

                (3) one hundred thousand dollars ($100,000) for single individuals and for estates and trusts."

     Section 2. TEMPORARY PROVISION.--For the taxable year 2010, a taxpayer is deemed to have complied with the provisions of Section 7-2-12.2 NMSA 1978 if the taxpayer has made the first required annual payment of estimated taxes due for taxable year 2010 based on the provisions of the version of Section 7-2-7 NMSA 1978 applicable on January 1, 2009 through December 31, 2010.

     Section 3. APPLICABILITY.--The provisions of this act apply to any taxable year beginning on or after 2010.

- 4 -