HOUSE BILL 561
50th legislature - STATE OF NEW MEXICO - first session, 2011
INTRODUCED BY
David L. Doyle
AN ACT
RELATING TO TAXATION; CREATING POST-SECONDARY INTERN INCOME TAX AND CORPORATE INCOME TAX CREDITS.
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] POST-SECONDARY INTERN INCOME TAX CREDIT.--
A. A taxpayer who files a New Mexico income tax
return and is not a dependent of another taxpayer may claim,
and the department may approve, a credit against the income tax
liability of the taxpayer for employing a student participating in an internship program or class at a post-secondary educational institution in New Mexico. The credit may be approved in an amount equal to ten percent of the wages paid to the intern. The credit provided in this section may be referred to as the "post-secondary intern income tax credit".
B. The purpose of the post-secondary intern income tax credit is to encourage businesses to employ university students who are enrolled in internship programs or classes at post-secondary educational institutions, to develop an employment-ready work force for businesses in the state and to encourage the hiring of graduates of post-secondary educational institutions.
C. To ensure that the department receives the
information needed to allow a post-secondary intern income tax credit, the department shall develop a schedule that may be added to the taxpayer's income tax return if the taxpayer claims a post-secondary intern income tax credit, that provides information sufficient to identify taxpayers who are eligible to receive a post-secondary intern income tax credit and further provides the department with information necessary to analyze the effectiveness of the credit.
D. A husband and wife who file separate returns for
a taxable year in which they could have filed a joint return
may each claim only one-half of the post-secondary intern income tax credit that would have been allowed on a joint return.
E. A taxpayer who otherwise qualifies for and
claims a post-secondary intern income tax credit who is a member of a partnership or other business association may claim a credit only in proportion to the taxpayer's interest in the partnership or business association. The total credit claimed in the aggregate by all members of the partnership or business association in a taxable year with respect to wages paid to an intern shall not exceed the maximum credit that would have been allowable pursuant to this section if claimed by a single taxpayer.
F. Any amount of the post-secondary intern income tax credit allowed by the department that exceeds the income tax liability of the taxpayer in the taxable year in which the credit is first claimed may be carried forward for three consecutive taxable years.
G. The department shall compile a report annually
for the revenue stabilization and tax policy committee that
sets forth the number of taxpayers approved to receive post-secondary intern income tax credits, the aggregate amount of credits approved and the average and median amounts of credits approved. The department shall analyze every three years beginning in 2013 whether the post-secondary intern income tax credit is performing the purpose for which it was created.
H. A taxpayer that claims a post-secondary intern income tax credit pursuant to the Income Tax Act shall not also claim a post-secondary intern income tax credit pursuant to the Corporate Income and Franchise Tax Act or any other similar tax credit for the same wages paid to an intern. The post-secondary intern income tax credit shall be applied to the taxpayer's tax liability before application of any other tax credit claimed for the taxable year by the taxpayer.
I. Acceptance of the post-secondary intern income tax credit is authorization for the department to reveal the amount of the tax credit claimed by the taxpayer as needed to report fully as required by this section to the revenue stabilization and tax policy committee of the legislature.
J. As used in this section:
(1) "intern" means a student enrolled in a class or program at the post-secondary educational institution that the student is attending that places a student:
(a) in employment in a position within the area of specialty in which the student is seeking a degree or with private industry or another business in a career-path position in which the student provides professional services under the supervision of more senior professional staff of the employer and from whom the student receives guidance, training and mentoring in planning and carrying out activities and assignments;
(b) in a position for a one- or two-year period;
(c) under the supervision of a faculty advisor that provides oversight of the student's progress as an intern and guidance in the student's area of specialty; and
(d) in a position for which the student is paid and receives credits toward a degree;
(2) "post-secondary educational institution" means a post-secondary educational institution named in Article 12, Section 11 of the constitution of New Mexico or a community college created pursuant to the Community College Act or the Technical and Vocational Institute Act; and
(3) "student" means an individual who is enrolled as a full-time undergraduate or master's level student at a post-secondary educational institution."
SECTION 2. A new section of the Corporate Income and Franchise Tax Act is enacted to read:
"[NEW MATERIAL] POST-SECONDARY INTERN CORPORATE INCOME TAX CREDIT.--
A. A taxpayer that files a New Mexico corporate
income tax return may claim, and the department may approve, a
credit against the corporate income tax liability of the
taxpayer for employing a student participating in an internship program or class at a post-secondary educational institution in New Mexico. The credit may be approved in an amount equal to ten percent of the wages paid to the intern. The credit provided in this section may be referred to as the "post-secondary intern corporate income tax credit".
B. The purpose of the post-secondary intern corporate income tax credit is to encourage businesses to employ university students who are enrolled in internship programs or classes at post-secondary educational institutions, to develop an employment-ready work force for businesses in the state and to encourage the hiring of graduates of post-secondary educational institutions.
C. To ensure that the department receives the
information needed to allow a post-secondary intern corporate income tax credit, the department shall develop a schedule that may be added to the taxpayer's income tax return if the taxpayer claims a post-secondary intern corporate income tax credit, that provides information sufficient to identify taxpayers that are eligible to receive a post-secondary intern corporate income tax credit and further provides the department with information necessary to analyze the effectiveness of the credit.
D. Any amount of the post-secondary intern corporate income tax credit allowed by the department that exceeds the income tax liability of the taxpayer in the taxable year in which the credit is first claimed may be carried forward for three consecutive taxable years.
E. The department shall compile a report annually
for the revenue stabilization and tax policy committee that
sets forth the number of taxpayers approved to receive post-secondary intern corporate income tax credits, the aggregate amount of credits approved and the average and median amounts of credits approved. The department shall analyze every three years beginning in 2013 whether the post-secondary intern corporate income tax credit is performing the purpose for which it was created.
F. A taxpayer that claims a post-secondary intern corporate income tax credit pursuant to the Corporate Income and Franchise Tax Act shall not also claim a post-secondary intern income tax credit pursuant to the Income Tax Act or any other similar tax credit for the same wages paid to an intern. The post-secondary intern corporate income tax credit shall be applied to the taxpayer's tax liability before application of any other tax credit claimed for the taxable year by the taxpayer.
G. Acceptance of the post-secondary intern corporate income tax credit is authorization for the department to reveal the amount of the tax credit claimed by the taxpayer as needed to report fully as required by this section to the revenue stabilization and tax policy committee of the legislature.
H. As used in this section:
(1) "intern" means a student enrolled in a class or program at the post-secondary educational institution that the student is attending that places a student:
(a) in employment in a position within the area of specialty in which the student is seeking a degree or with private industry or another business in a career-path position in which the student provides professional services under the supervision of more senior professional staff of the employer and from whom the student receives guidance, training and mentoring in planning and carrying out activities and assignments;
(b) in a position for a one- or two-year period;
(c) under the supervision of a faculty advisor that provides oversight of the student's progress as an intern and guidance in the student's area of specialty; and
(d) in a position for which the student is paid and receives credits toward a degree;
(2) "post-secondary educational institution" means a post-secondary educational institution named in Article 12, Section 11 of the constitution of New Mexico or a community college created pursuant to the Community College Act or the Technical and Vocational Institute Act; and
(3) "student" means an individual who is enrolled as a full-time undergraduate or master's level student at a post-secondary educational institution."
SECTION 3. APPLICABILITY.--The provisions of this act apply to taxable years beginning on or after January 1, 2011.
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