45th legislature - STATE OF NEW MEXICO - first session, 2001

RELATING TO TAXATION; EXEMPTING CERTAIN RETIREMENT INCOME FROM TAXATION.

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] EXEMPTION--RETIREMENT INCOME.--

A. An individual may claim an exemption from income taxation for retirement income included in net income in an amount not to exceed two thousand five hundred dollars ($2,500).

B. As used in this section, "retirement income" means:

(1) annuity or pension income required by federal law or regulation to be reported on information return federal form 1099-R or a successor form used to report distributions from pensions, annuities, retirement or profit- sharing plans, individual retirement accounts, insurance contracts and similar income that is attributable to a benefit taxable for federal income tax purposes paid to an individual under a qualified plan, annuity or simplified employee pension plan pursuant to Sections 401 through 404, Section 408 or 457 of the Internal Revenue Code of 1986 and including any inside buildup of interest distributed in conjunction with any of the listed distributions; and

(2) social security or equivalent tier 1 railroad retirement benefit income required by federal law or regulation to be reported on information return federal forms SSA-1099, SSA-1042S, RRB-1099, or RRB-1042S or their respective successor forms used to report distributions of social security or equivalent tier 1 railroad retirement benefits that are attributable to a benefit taxable for federal income tax purposes and paid to an individual pursuant to Section 86 of the Internal Revenue Code of 1986."

Section 2. APPLICABILITY.--The provisions of this act apply to taxable years beginning on or after January 1, 2001.