Home New mexico tax NM’s tax landscape has changed this year – make sure you know...

NM’s tax landscape has changed this year – make sure you know what you’re entitled to

3
0

With record tax revenue in the state of New Mexico, there’s more to know about tax changes and rebates for New Mexicans. Bills passed in the regular and special session affect taxes in 2021, 2022 and beyond. The following is a roundup of new state laws and programs, but it is not tax advice; see a tax resource for more information.

For 2021

Tax rebates

• Single, refundable refunds will be $500 for married couples filing jointly with incomes below $150,000 and $250 for single filers with incomes below $75,000. Rebates will be sent automatically to eligible taxpayers who have filed a 2021 Personal Income Tax (IRP) return. No application is required.

• A refundable income tax refund for all taxpayers of $500 for single filers and $1,000 for joint filers. The rebate will be split into two equal installments, one in June 2022 and one in August 2022. The rebates will be sent automatically to taxpayers who have filed a 2021 PIT return. No application is required.

If you owe state taxes, refunds can be used to offset any liabilities on the 2021 tax year return before issuing a refund to you.

Low-income New Mexicans who are not required to file may also be eligible for refundable tax credits and rebates such as the Low-Income Comprehensive Tax Rebate. Refundable credits and rebates may result in a refund to filers, even though they are not subject to tax. Low-income filers who are not subject to tax can still file without penalty. Applications will be available on the YES-NM website at www.yes.state.nm.us beginning at 8 a.m. May 2.

Relief payments

• New Mexicans who do not file taxes will be able to apply for relief payments starting at 8 a.m. on May 2. Relief payments will be issued on a first-come, first-served basis and will be disbursed no later than July 31. the deadline to request a relief payment is 5 p.m. on May 31, but requests may be closed before May 31 if available funds are exhausted.

To apply for a relief payment from the Department of Social Services, go to the YES-NM website at www.yes.state.nm.us beginning May 2. The application will be available in English and Spanish.

Working Families Tax Credit (WFTC)

• Under House Bill 291, the WFTC represents 20% of the Federal Earned Income Tax Credit (EITC). It is based on family size and income. For taxpayers between the ages of 18 and 25 with or without children, this change was made permanent in HB 291.

Low Income Comprehensive Income Tax Refund (LICTR)

• This is also part of House Bill 291 and is now available to taxpayers with up to $36,000 of adjusted gross income. According to the Department of Taxes and Revenue, if you have already filed, including the LICTR, no further action is necessary. If you did not claim this rebate, you can file an amended return.

For 2022 and beyond

Credit for nurses

• A taxpayer who is not dependent on another person and who worked full time as a nurse in a hospital located in New Mexico can claim a tax credit on the tax payable by the taxpayer. The amount of the tax credit granted for the 2022 tax year is $1,000.

Child income tax credit

• For taxation years beginning on January 1, 2023 and before January 1, 2032, a taxpayer who is a resident and who is not dependent on another individual may claim a credit on the tax payable from taxpayer for each eligible child of the taxpayer. . The credit ranges from $25 to $175 per child, depending on income.

Exemption from military retirement indemnities

• There is now an income tax exemption for armed forces retirees, starting at $10,000 of military retirement income in 2022 and gradually increasing to $30,000 of retirement income over the years of retirement. taxation 2024 to 2026.

Exemption from social security income

• Beginning with the 2022 tax year, New Mexico will exempt Social Security retirement income from taxation for individual retirees who earn less than $100,000 per year. The income threshold is $75,000 for married people filing separately and $150,000 for heads of families, surviving spouses and married people filing jointly.

Gross Receipts Tax

• Similar to a sales tax, but applied to most goods and services, the Gross Receipts and Countervailing Tax Rate Schedules from the Department of Taxation and Revenue show a reduction of 0.125 percentage points in July 2022 and at new in 2023.

Did you know?

• Anyone who turns 100 is exempt from personal income tax in New Mexico if that person is not claimed as a dependent by another taxpayer? For information, a spouse is not a dependent. (See Bulletin B300.3)

Source: New Mexico Department of Taxation and Revenue www.tax.newmexico.gov/