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F I S C A
L I M P A C T R E P O R T
SPONSOR:
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Crook
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DATE TYPED:
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3/09/03
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HB
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282/aHTRC
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SHORT TITLE:
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Amend Income Tax Act
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SB
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ANALYST:
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Smith
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REVENUE
Estimated Revenue
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Subsequent
Years Impact
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Recurring
or
Non-Rec
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Fund
Affected
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FY03
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FY04
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|
|
|
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NFI
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(Parenthesis ( ) Indicate Revenue Decreases)
SOURCES
OF INFORMATION
Responses
Received From
Taxation
and Revenue Department (TRD)
SUMMARY
Synopsis of HTRC Amendment
The House Taxation and Revenue Committee amendments
are primarily technical in nature. The
amendment also modifies the definition of “base income” to include Education
Trust Act deductions made in a prior year that would, due to requirements under
the Education Trust Fund Act, become taxable. This material is currently in
Section 7-2-33B. The HTRC amendment would repeal Section 7-2-33B, however, to
make it conform with drafting conventions currently employed in the Income Tax
Act.
Synopsis
of Original Bill
House Bill 282 makes changes a variety of changes to
the Income Tax Act (Chapter 7, Article 2 NMSA 1978) as summarized below.
- Section
7-2-2 Definitions – The proposal
changes the definition of “resident” to clarify that taxpayers are subject
to provisions of the Income Tax Act for periods when they are residents
for tax purposes --even if their residency subsequently changes. Language in current statute implies that
when taxpayers cease being residents, they are not subject to New Mexico income tax during
the time they were residents.
- Section
7-2-12 Taxpayer Return; Payment of Tax--Inserts language in Section 7-2-12
stating that when the Department approves electronic media for use by
taxpayers whose tax year is a calendar year, taxpayers using electronic
media for filing and payment are required to submit returns and taxes on
or before the 30th day of the fourth month following the end of
the tax year.
- Section
7-2-12.2 Estimated Tax Due; Payment
of Estimated Tax; Penalty – The proposal amends the definition of
“tax” to mean “tax” net of all applicable credits rather than just those
credits identified in current statute. This change makes it easier to
compute correct amounts of estimated tax due.
- 7-2-14.3
Tax Rebate of Part of Property Tax Due from Low-Income Taxpayers; Local
Option; Refund –
Subsection H requires counties enacting an ordinance providing a property
tax rebate to its low-income residents to specify the years for which the
rebate applies. Subsection I changes the date the Department must certify
to counties amounts of rebates claimed by their residents. Currently this
date is July 1 of the year immediately following the one in which rebates
are in effect. The proposed change
moves the date to December 31. The change simply allows the Department a
little more time to determine the amounts of rebate paid to county
residents. Under current and
proposed statute, counties must reimburse the Department for rebates allowed
under the program.
- 7-2-18
Tax Rebate of Property Tax Due that Exceeds the Elderly Taxpayer’s Maximum
Property Tax Liability; Refund – The
proposal adds the requirement to existing statute that resolutions by
counties enacting the expanded rebate should specify the period for which
the rebate may be claimed.
- 7-2-33
Education Trust Fund; Earnings Tax Exempt; Withdrawals Are Taxable Income;
Authority to Withhold Tax – The proposed change clarifies that
taxpayers may not claim a second exemption of education trust fund
earnings that may be exempt already from federal income tax.
Significant
Issues
This
Bill was endorsed by the Revenue Stabilization and Tax Policy Committee.
SS/sb:yr:prr