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

RELATING TO TAXATION; PROVIDING FOR AN INCOME TAX CREDIT TO DISTRIBUTE PAYMENTS OF REVENUE-SHARING ARREARAGES.

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

Section 1. A new section of the Income Tax Act, Section 7-2-18.7 NMSA 1978, is enacted to read:

"7-2-18.7. [NEW MATERIAL] TAXPAYER RELIEF CREDIT.--

A. For the 2000 and subsequent taxable years, any resident who files an individual New Mexico income tax return and who is not a dependent of another taxpayer may claim for the resident, and if included in the resident's return for the resident's spouse and each dependent of the resident, a credit provided by this section in an amount determined in accordance with Subsection B of this section; provided that a credit allowed by this section may not be claimed or allowed for a resident, spouse or dependent who was an inmate of a public institution for more than six months during the taxable year.

B. By October 10, 2000, the department of finance and administration shall determine the amount of revenue-sharing payments or portions of payments due prior to January 1, 2000 pursuant to revenue-sharing agreements authorized by Section 11-13-2 NMSA 1978 but which were received by the state during the period January 1, 2000 through September 30, 2000 and shall notify the secretary of taxation and revenue of that amount. For the 2001 and succeeding taxable years, the department of finance and administration shall determine the amount of revenue-sharing payments or portions of payments due prior to January 1, 2000 but received during the period October 1 of the immediately preceding taxable year through September 30 of the taxable year and report that amount to the secretary of taxation and revenue by October 10 of that taxable year. The taxation and revenue department shall determine the amount of the credit for a taxable year by dividing the amount reported by the department of finance and administration in October of the taxable year by the estimated population of the state. The resulting dividend shall be rounded down to the nearest dollar. That dollar amount shall be the credit amount for purposes of this section for the taxable year; provided that if the amount reported is less than one million dollars ($1,000,000), the credit amount shall be zero.

C. 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.

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