Fiscal impact reports (FIRs) are prepared by the Legislative Finance Committee (LFC) for standing finance committees of the NM Legislature. The LFC does not assume responsibility for the accuracy of these reports if they are used for other purposes.

Current FIRs (in HTML & Adobe PDF formats) are available on the NM Legislative Website (legis.state.nm.us). Adobe PDF versions include all attachments, whereas HTML versions may not. Previously issued FIRs and attachments may also be obtained from the LFC in Suite 101 of the State Capitol Building North.

F I S C A L I M P A C T R E P O R T

SPONSOR	Park		DATE TYPED	1/28/04		HB	225
SHORT TITLE		Public School Teacher Income Tax Credit				SB
					ANALYST		Taylor

REVENUE

Estimated Revenue		Subsequent Years Impact	Recurring or Non-Rec	Fund Affected
FY04	FY05
Insignificant	(106,300.0)	(106,300.0)	Recurring	General Fund

(Parenthesis ( ) Indicate Revenue Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Legislative Education Study Committee (LESC)

Taxation and Revenue Department (TRD)

SUMMARY

House Bill 225 provides an income tax credit to New Mexico public school teachers. The maximum credit is $5 thousand. The credit is applied against the taxpayer’s liability. It is refundable, meaning that if the credit is greater than taxes owed, the difference is paid to the taxpayer.

The bill is applicable to taxable years beginning on or after January 1, 2004.

FISCAL IMPLICATIONS

The LESC reports that as of the 120^th day of the 2003 school year, there were 21,260 public school teachers in New Mexico. Multiplying the number of teachers by $5 thousand implies a loss of $100.9 million to the state general fund. According to TRD, the FY04 impact would be small because few taxpayers would be able to adjust their withholding or quarterly payments until some time in FY05.

ADMINISTRATIVE IMPLICATIONS

TRD indicates that administrative impacts could be absorbed with existing resources.

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