HOUSE BILL 1016

47th legislature - STATE OF NEW MEXICO - first session, 2005

INTRODUCED BY

Daniel R. Foley

AN ACT

RELATING TO TAXATION; ALLOWING INCOME TAX DEDUCTIONS FOR CERTAIN WITHDRAWALS FROM RETIREMENT TAX SAVINGS ACCOUNTS.

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] DEDUCTION--RETIREMENT TAX SAVINGS ACCOUNTS.--

          A. An individual fifty-nine and one-half years of age or older may claim a deduction from net income in an amount equal to all withdrawals from:

                (1) a qualified retirement plan as defined in Section 4974(c) of the Internal Revenue Code;

                (2) a deferred compensation plan pursuant to Section 457(b) of the Internal Revenue Code; and

                (3) the thrift savings fund pursuant to Section 7701(j) of the Internal Revenue Code.

          B. An individual under fifty-nine and one-half years of age may claim a deduction from net income in the amount equal to all withdrawals from a plan specified in Subsection A of this section if the withdrawal is to be used for:

                (1) expenses for medical care as defined in Section 213(d)(1) of the Internal Revenue Code; or

                (2) qualified higher education expenses as defined in Section 72(t)(7)(A) of the Internal Revenue Code."

     Section 2. APPLICABILITY.--The provisions of this act apply to taxable years beginning on or after January 1, 2005.

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