44th legislature - STATE OF NEW MEXICO - second session, 2000

RELATING TO TAXATION; AMENDING THE INCOME TAX ACT TO INCREASE THE AMOUNT OF THE LOW-INCOME COMPREHENSIVE TAX REBATE FOR CERTAIN FAMILIES AND TO PROVIDE AN ADDITIONAL TAX CREDIT TO FAMILIES WITH CHILDREN SIX YEARS OF AGE AND YOUNGER.

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

Section 1. A new section of the Income Tax Act is enacted to read:

"[NEW MATERIAL] EARLY CHILDHOOD ADVANTAGE CREDIT.--

A. A resident who files an individual New Mexico income tax return, who is not a dependent of another taxpayer and who is eligible for a low-income comprehensive tax rebate may claim a credit of two hundred twenty-five dollars ($225) for each dependent of the resident who is six years of age or younger on the first day of the taxable year, not to exceed a total credit of six hundred seventy-five dollars ($675). The credit provided in this section shall be known as the "early childhood advantage tax credit".

B. A husband and wife who file separate returns for a taxable year in which they could have filed a joint return may each claim only one-half of the early childhood advantage tax credit that would have been allowed on a joint return.

C. No claim for the tax credit provided in this section shall be filed by a resident who was an inmate of a public institution for more than six months during the taxable year for which the tax credit could be claimed or who was not physically present in New Mexico for at least six months during the taxable year for which the tax credit could be claimed.

D. The tax credit provided by this section may be deducted from the taxpayer's New Mexico income tax liability for the taxable year. If the tax credit exceeds the taxpayer's income tax liability, the excess shall be refunded to the taxpayer.

E. As used in this section: "dependent" means "dependent" as defined in Section 152 of the Internal Revenue Code, but also includes any minor child or stepchild of the resident who would be a dependent for federal income tax purposes if the public assistance contributing to the support of the child or stepchild was considered to have been contributed by the resident."

Section 2. Section 7-2-14 NMSA 1978 (being Laws 1972, Chapter 20, Section 2, as amended) is amended to read:

"7-2-14. LOW-INCOME COMPREHENSIVE TAX REBATE.--

A. Except as otherwise provided in Subsection B of this section, any resident who files an individual New Mexico income tax return and who is not a dependent of another individual may claim a tax rebate for a portion of state and local taxes to which the resident has been subject during the taxable year for which the return is filed. The tax rebate may be claimed even though the resident has no income taxable under the Income Tax Act. A husband and wife who file separate returns for a taxable year in which they could have filed a joint return may each claim only one-half of the tax rebate that would have been allowed on a joint return.

B. No claim for the tax rebate provided in this section shall be filed by a resident who was an inmate of a public institution for more than six months during the taxable year for which the tax rebate could be claimed or who was not physically present in New Mexico for at least six months during the taxable year for which the tax rebate could be claimed.

C. For the purposes of this section, the total number of exemptions for which a tax rebate may be claimed or allowed is determined by:

(1) adding the number of federal exemptions allowable for federal income tax purposes for each individual included in the return who is domiciled in New Mexico plus:

(a) two additional exemptions for each individual domiciled in New Mexico included in the return who is sixty-five years of age or older; [plus]

(b) one additional exemption for each individual domiciled in New Mexico included in the return who, for federal income tax purposes, is blind; [plus one exemption]

(c) two additional exemptions for each minor child or stepchild of the resident; and

(d) three exemptions for each minor child or stepchild of the resident who would be a dependent for federal income tax purposes if the public assistance contributing to the support of the child or stepchild was considered to have been contributed by the resident; and

(2) subtracting from the number determined in Paragraph (1) of this subsection the number of exemptions for each individual included in the return who was an inmate of a public institution for more than six months during the taxable year, plus, if included in the calculation set forth in Paragraph (1) of this subsection, two exemptions for each such individual who was aged sixty-five years or older.

D. The tax rebate provided for in this section may be claimed in the amount shown in the following table:

Modified gross And the total number

income is: of exemptions is:

But Not 6 or

Over Over 1 2 3 4 5 More

[$ 0 $ 500 $ 120 $ 160 $ 200 $ 240 $ 280 $ 320

500 1,000 135 195 250 310 350 415

1,000 1,500 135 195 250 310 350 435

1,500 2,000 135 195 250 310 350 450

2,000 2,500 135 195 250 310 350 450

2,500 3,000 135 195 250 310 350 450

3,000 3,500 135 195 250 310 350 450

3,500 4,000 135 195 250 310 355 450

4,000 4,500 135 195 250 310 355 450

4,500 5,000 125 190 240 305 355 450

5,000 5,500 115 175 230 295 355 430

5,500 6,000 105 155 210 260 315 410

6,000 7,000 90 130 170 220 275 370

7,000 8,000 80 115 145 180 225 295

8,000 9,000 70 105 135 170 195 240

9,000 10,000 65 95 115 145 175 205

10,000 11,000 60 80 100 130 155 185

11,000 12,000 55 70 90 110 135 160

12,000 13,000 50 65 85 100 115 140

13,000 14,000 50 65 85 100 115 140

14,000 15,000 45 60 75 90 105 120

15,000 16,000 40 55 70 85 95 110

16,000 17,000 35 50 65 80 85 105

17,000 18,000 30 45 60 70 80 95

18,000 19,000 25 35 50 60 70 80

19,000 20,000 20 30 40 50 60 65

20,000 21,000 15 25 30 40 50 55

21,000 22,000 10 20 25 35 40 45]

$ 0 $ 500 $ 120 $ 160 $ 200 $ 240 $ 280 $ 320

500 1,000 135 195 250 310 350 415

1,000 1,500 135 195 250 310 350 435

1,500 3,500 135 195 250 310 350 450

3,500 4,500 135 234 300 372 426 540

4,500 5,000 125 228 288 366 426 540

5,000 5,500 115 210 276 354 426 516

5,500 6,000 105 186 252 312 378 492

6,000 7,000 90 156 204 264 330 444

7,000 8,000 80 138 174 216 270 354

8,000 9,000 70 126 162 204 234 288

9,000 10,000 65 114 138 174 210 246

10,000 11,000 60 96 120 156 186 222

11,000 12,000 55 84 108 132 162 192

12,000 14,000 50 78 102 120 138 168

14,000 15,000 45 72 90 108 126 144

15,000 16,000 40 66 84 102 114 132

16,000 17,000 35 60 78 96 102 126

17,000 18,000 30 54 72 84 96 114

18,000 19,000 25 42 60 72 84 96

19,000 20,000 20 36 48 60 72 78

20,000 21,000 15 30 36 48 60 66

21,000 22,000 10 24 30 42 48 54.

E. If a taxpayer's modified gross income is zero, the taxpayer may claim a credit in the amount shown in the first row of the table appropriate for the taxpayer's number of exemptions.

F. The tax rebates provided for in this section may be deducted from the taxpayer's New Mexico income tax liability for the taxable year. If the tax rebates exceed the taxpayer's income tax liability, the excess shall be refunded to the taxpayer.

G. For purposes of this section, "dependent" means "dependent" as defined by Section 152 of the Internal Revenue Code [of 1986], as that section may be amended or renumbered, but also includes any minor child or stepchild of the resident who would be a dependent for federal income tax purposes if the public assistance contributing to the support of the child or stepchild was considered to have been contributed by the resident."

Section 3. APPLICABILITY.--The provisions of this act apply to taxable years beginning on or after January 1, 2000.