0001| SENATE BILL 871 | 0002| 43rd legislature - STATE OF NEW MEXICO - first session, 1997 | 0003| INTRODUCED BY | 0004| CYNTHIA NAVA | 0005| | 0006| | 0007| | 0008| FOR THE LEGISLATIVE HEALTH AND HUMAN SERVICES COMMITTEE | 0009| | 0010| AN ACT | 0011| RELATING TO TAXATION; EXPANDING ELIGIBILITY FOR AND INCREASING | 0012| THE AMOUNT OF THE INCOME TAX CREDIT FOR EXPENSES INCURRED FOR | 0013| CHILD DAY CARE. | 0014| | 0015| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO: | 0016| Section 1. Section 7-2-18.1 NMSA 1978 (being Laws 1981, | 0017| Chapter 170, Section 1, as amended) is amended to read: | 0018| "7-2-18.1. CREDIT FOR EXPENSES FOR DEPENDENT CHILD DAY | 0019| CARE NECESSARY TO ENABLE GAINFUL EMPLOYMENT TO PREVENT | 0020| INDIGENCY.-- | 0021| A. As used in this section: | 0022| (1) "caregiver" means a corporation or an | 0023| individual eighteen years of age or over who receives | 0024| compensation from the resident for providing direct care, | 0025| supervision and guidance to a qualifying dependent of the | 0001| resident for less than twenty-four hours daily and includes | 0002| related individuals of the resident but does not include a | 0003| dependent of the resident; | 0004| (2) "cost of maintaining a household" means | 0005| the expenses incurred for the mutual benefit of the occupants | 0006| thereof by reason of its operation as the principal place of | 0007| abode of such occupants, including property taxes, mortgage | 0008| interest, rent, utility charges, upkeep and repairs, property | 0009| insurance and food consumed on the premises. "Cost of | 0010| maintaining a household" shall not include expenses otherwise | 0011| incurred, including cost of clothing, education, medical | 0012| treatment, vacations, life insurance, transportation and | 0013| mortgages; | 0014| (3) "dependent" means "dependent" as defined | 0015| by Section 152 of the Internal Revenue Code, as that section | 0016| may be amended or renumbered, but also includes any minor child | 0017| or stepchild of the resident who would be a dependent for | 0018| federal income tax purposes if the public assistance | 0019| contributing to the support of the child or stepchild was | 0020| considered to have been contributed by the resident; | 0021| (4) "disabled person" means a person who has a | 0022| medically determinable physical or mental impairment, as | 0023| certified by a licensed physician, that renders such person | 0024| unable to engage in gainful employment; | 0025| (5) "gainfully employed" means working for | 0001| remuneration for others, either full time or part time, or | 0002| self-employment in a business or partnership; and | 0003| (6) "qualifying dependent" means a dependent | 0004| under the age of fifteen at the end of the taxable year who | 0005| receives the services of a caregiver. | 0006| B. Any resident who files an individual New Mexico | 0007| income tax return and who is not a dependent of another | 0008| taxpayer may claim a credit for child day care expenses | 0009| incurred and paid to a caregiver in New Mexico during the | 0010| taxable year by such resident if the resident: | 0011| (1) singly or together with a spouse furnishes | 0012| over half the cost of maintaining the household for one or more | 0013| qualifying dependents for any period in the taxable year for | 0014| which the credit is claimed; | 0015| (2) is gainfully employed for any period for | 0016| which the credit is claimed or, if a joint return is filed, | 0017| both spouses are gainfully employed or one is disabled for any | 0018| period for which the credit is claimed; | 0019| (3) compensates a caregiver for child | 0020| day care for a qualifying dependent to enable such resident | 0021| together with his spouse, if any and if not disabled, to be | 0022| gainfully employed; | 0023| (4) is not a recipient of public assistance | 0024| under a program of [aid to families with dependent children] | 0025| temporary assistance to needy families during any period for | 0001| which the credit provided by this section is claimed; and | 0002| (5) has a modified gross income, including | 0003| child support payments, if any, of not more than the annual | 0004| income that would be derived from earnings at [double] | 0005| triple the federal minimum wage. | 0006| C. The credit provided for in this section shall be | 0007| forty percent of the actual compensation paid to a caregiver by | 0008| the resident for a qualifying dependent not to exceed [four | 0009| hundred eighty dollars ($480)] six hundred dollars ($600) | 0010| for each qualifying dependent or a total of [one thousand two | 0011| hundred dollars ($1,200)] one thousand five hundred dollars | 0012| ($1,500) for all qualifying dependents for a taxable year. | 0013| For the purposes of computing the credit, actual compensation | 0014| shall not exceed [eight dollars ($8.00)] ten dollars | 0015| ($10.00) per day for each qualifying dependent. | 0016| D. The caregiver shall furnish the resident with a | 0017| signed statement of compensation paid by the resident to the | 0018| caregiver for day care services. Such statements shall specify | 0019| the dates and the total number of days for which payment has | 0020| been made. | 0021| E. If the resident taxpayer has a federal tax | 0022| liability, the taxpayer shall claim from the state not more | 0023| than the difference between the amount of the state child care | 0024| credit for which the taxpayer is eligible and the federal | 0025| credit for child and dependent care expenses the taxpayer is | 0001| able to deduct from federal tax liability for the same taxable | 0002| year; provided, for first-year residents only, the amount of | 0003| the federal credit for child and dependent care expenses may be | 0004| reduced to an amount equal to the amount of federal credit for | 0005| child and dependent care expenses the resident is able to | 0006| deduct from federal tax liability multiplied by the ratio of | 0007| the number of days of residence in New Mexico during the | 0008| resident's taxable year to the total number of days in the | 0009| resident's taxable year. | 0010| F. The credit provided for in this section may be | 0011| deducted from the taxpayer's New Mexico income tax liability | 0012| for the taxable year. If the credit exceeds the taxpayer's | 0013| income tax liability, the excess shall be refunded to the | 0014| taxpayer. | 0015| G. A husband and wife maintaining a household for | 0016| one or more qualifying dependents and filing separate returns | 0017| for a taxable year for which they could have filed a joint | 0018| return: | 0019| (1) may each claim only one-half of the credit | 0020| that would have been claimed on a joint return; and | 0021| (2) are eligible for the credit provided in | 0022| this section only if their joint modified gross income, | 0023| including child support payments, if any, is not more than the | 0024| annual income that would be derived from earnings at [double] | 0025| triple the federal minimum wage." | 0001| Section 2. APPLICABILITY.--The provisions of this act | 0002| apply to taxable years beginning on or after January 1, 1997. | 0003| | 0004| FORTY-THIRD LEGISLATURE | 0005| FIRST SESSION, 1997 | 0006| | 0007| | 0008| March 14, 1997 | 0009| | 0010| Mr. President: | 0011| | 0012| Your WAYS AND MEANS COMMITTEE, to whom has been | 0013| referred | 0014| | 0015| SENATE BILL 871 | 0016| | 0017| has had it under consideration and reports same with | 0018| recommendation that it DO PASS, and thence referred to the | 0019| FINANCE COMMITTEE. | 0020| | 0021| Respectfully submitted, | 0022| | 0023| | 0024| | 0025| | 0001| __________________________________ | 0002| Carlos R. Cisneros, Chairman | 0003| | 0004| | 0005| | 0006| Adopted_______________________ Not | 0007| Adopted_______________________ | 0008| (Chief Clerk) (Chief Clerk) | 0009| | 0010| | 0011| Date ________________________ | 0012| | 0013| | 0014| The roll call vote was 5 For 0 Against | 0015| Yes: 5 | 0016| No: 0 | 0017| Excused: Duran, Jennings, McSorley, Wilson | 0018| Absent: None | 0019| | 0020| | 0021| S0871WM1 | 0022| | 0023| | 0024| | 0025| FORTY-THIRD LEGISLATURE | 0001| FIRST SESSION, 1997 | 0002| | 0003| | 0004| March 17, 1997 | 0005| | 0006| Mr. President: | 0007| | 0008| Your FINANCE COMMITTEE, to whom has been referred | 0009| | 0010| SENATE BILL 871 | 0011| | 0012| has had it under consideration and reports same with | 0013| recommendation that it DO PASS. | 0014| | 0015| Respectfully submitted, | 0016| | 0017| | 0018| | 0019| | 0020| __________________________________ | 0021| Ben D. Altamirano, Chairman | 0022| | 0023| | 0024| | 0025| Adopted_______________________ Not | 0001| Adopted_______________________ | 0002| (Chief Clerk) (Chief Clerk) | 0003| | 0004| | 0005| | 0006| Date ________________________ | 0007| | 0008| | 0009| The roll call vote was 6 For 0 Against | 0010| Yes: 6 | 0011| No: None | 0012| Excused: Aragon, Ingle, Lyons, McKibben, Smith | 0013| Absent: None | 0014| | 0015| | 0016| S0871FC1 |