HOUSE BILL 122
54th legislature - STATE OF NEW MEXICO - second session, 2020
RELATING TO ACTIONS AFFECTING PROPERTY; IDENTIFYING AND LIMITING EXEMPTIONS IN CERTAIN LEGAL PROCEEDINGS; PROVIDING FOR COST-OF-LIVING ADJUSTMENTS; AMENDING, REPEALING AND ENACTING SECTIONS OF THE NMSA 1978.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. Section 42-10-1 NMSA 1978 (being Laws 1971, Chapter 215, Section 1, as amended) is amended to read:
"42-10-1. EXEMPTIONS [OF MARRIED PERSONS OR HEADS OF HOUSEHOLDS].--[Personal property in the amount of five hundred dollars ($500), tools of the trade in the amount of fifteen hundred dollars ($1,500), one motor vehicle in the amount of four thousand dollars ($4,000), jewelry in the amount of twenty-five hundred dollars ($2,500), clothing, furniture, books, medical-health equipment being used for the health of the person and not for his profession and any interest in or proceeds from a pension or retirement fund of every person supporting another person is exempt from receivers or trustees in bankruptcy or other insolvency proceedings, fines, attachment, execution or foreclosure by a judgment creditor. Property exempted shall be valued at the market value of used chattels.]
A. The following shall be exempt from receivers or trustees in bankruptcy or other insolvency proceedings, fines, attachment, execution or foreclosure by a judgment creditor:
(1) household goods and furnishings not exceeding twenty-five thousand dollars ($25,000) in aggregate per person;
(2) a person's interest in motor vehicles not exceeding ten thousand dollars ($10,000) in value;
(3) a person's interest in jewelry held primarily for the use of the person, the person's spouse or any dependent of the person, not exceeding four thousand five hundred dollars ($4,500) in aggregate;
(4) a person's aggregate interest in real property, not to exceed two thousand five hundred dollars ($2,500) in value, plus up to twenty-two thousand five hundred dollars ($22,500) of any unused amount of the homestead exemption pursuant to Section 42-10-9 NMSA 1978;
(5) implements, professional books, equipment or other tools of the trade primarily for the use of the person in any trade of the person, the person's spouse or any dependent of the person, not exceeding seven thousand five hundred dollars ($7,500) in aggregate;
(6) the person's right to receive:
(a) social security benefits;
(b) veteran's benefits;
(c) disability, illness, unemployment or workers' compensation benefits;
(d) public benefits such as medicaid, food stamps or other aid from a government public assistance program;
(e) alimony, family or domestic support, or separate maintenance to the extent reasonably necessary for the support of the person or any dependent of the person; and
(f) payment pursuant to a stock bonus, pension, profit-sharing, annuity or similar plan or contract on account of illness, disability, death or length of service, to the extent reasonably necessary for the support of the person or any dependent of the person, unless such plan or contact does not qualify pursuant to Section 401(a), 403(a), 403(b) or 408 of the Internal Revenue Code of 1986;
(7) retirement funds to the extent that those funds are in a fund or account that is exempt from taxation pursuant to Section 401, 403, 408, 408A, 414, 457 or 501(a) of the Internal Revenue Code of 1986;
(8) an interest in or proceeds from a pension or retirement fund of a person supporting another person; and
(9) refundable federal and state tax credits.
B. Property exempted pursuant to the provisions of this section shall be valued at the market value of used chattels.
C. As used in this section, "household goods and furnishings" means items primarily used by or for the support and maintenance of the household of the person or the person's spouse, family and dependents, including:
(2) appliances such as a refrigerator, stove, oven, freezer, clothes washer, clothes dryer, dishwasher, microwave oven, coffee maker, toaster and vacuum cleaner;
(4) electronic equipment such as televisions, radios, cellular telephones, computers, computer equipment, digital versatile disc or compact disc players and other electronic consumer devices;
(5) kitchenware, cookware, dishes, utensils, silverware, china and glasses;
(7) musical instruments;
(8) educational materials and equipment;
(9) medical equipment, supplies and professionally prescribed health aids;
(10) personal effects, including wedding rings, toys, games and sports, hobby and craft equipment and supplies;
(11) books; and
(12) two firearms.
D. As used in the section, "household goods and furnishings" does not include:
(1) works of art or artwork, unless by or of the person or any relative of the person, not exceeding two thousand five hundred dollars ($2,500) in value for any one item; and
(2) electronic entertainment equipment with a fair market value of more than one thousand five hundred dollars ($1,500) per item."
SECTION 2. Section 42-10-4 NMSA 1978 (being Laws 1887, Chapter 37, Section 7, as amended) is amended to read:
"42-10-4. BENEVOLENT ASSOCIATIONS--BENEFITS.--[SEC. 5.] Any beneficiary fund not exceeding [five thousand dollars] fifty thousand dollars ($50,000) set apart, appropriated or paid by any benevolent association or society, according to its rules, regulations or bylaws, to the family of any deceased member or to any member of [such] the deceased member's family, shall not be liable to be taken by any process or proceedings, legal or equitable, to pay any debts of [such] the deceased member."
SECTION 3. Section 42-10-9 NMSA 1978 (being Laws 1971, Chapter 215, Section 6, as amended) is amended to read:
"42-10-9. HOMESTEAD EXEMPTION.--[Each person shall have exempt a homestead in a dwelling house and land occupied by the person or in a dwelling house occupied by the person although the dwelling is on land owned by another, provided that the dwelling is owned, leased or being purchased by the person claiming the exemption. Such a person has a homestead of sixty thousand dollars ($60,000) exempt from attachment, execution or foreclosure by a judgment creditor and from any proceeding of receivers or trustees in insolvency proceedings and from executors or administrators in probate. If the homestead is owned jointly by two persons, each joint owner is entitled to an exemption of sixty thousand dollars ($60,000).]
A. A person shall have a homestead exemption in a domicile or land owned by the person that is the primary residence of the person. That homestead is exempt from attachment, execution or foreclosure by a judgment creditor and from any proceeding of receivers or trustees in insolvency proceedings and from executors or administrators in probate.
B. The amount of the homestead exemption is:
(1) one hundred ninety-five thousand dollars ($195,000) unless the person or spouse of the person who resides in the homestead is a person described in Paragraph (2) or (3) of this subsection;
(2) three hundred ninety thousand dollars ($390,000) if the homestead is owned jointly by:
(a) a person and the person who owns or resides in the homestead; or
(b) a spouse of the person who owns or resides in the homestead; or
(3) four hundred twenty-five thousand dollars ($425,000) if the person or spouse of the person who owns or resides in the homestead is:
(a) sixty-five years of age or older;
(b) fifty-five years of age or older with: 1) a gross annual income of not more than twenty-five thousand dollars ($25,000); or 2) if the person is married, a gross annual income, including the gross annual income of the person's spouse, of not more than fifty thousand dollars ($50,000); or
(c) physically or mentally disabled and who, as a result of that disability, is unable to engage in substantial gainful employment. There is a rebuttable presumption affecting the burden of proof that a person receiving disability insurance benefit payments under Title II of the federal Social Security Act or supplemental security income payments under Title XVI of the federal Social Security Act satisfies the requirements of this subparagraph as to the person's inability to engage in substantial gainful employment.
C. The combined homestead exemptions of spouses shall not exceed the amount specified in Paragraph (2) or (3) of Subsection B of this section, whichever is applicable, regardless of whether the spouses are jointly obligated on the judgment and regardless of whether the homestead consists of community or separate property or both.
D. If both spouses are entitled to a homestead exemption, the exemption of proceeds of the homestead shall be apportioned between the spouses on the basis of their proportionate interests in the homestead."
SECTION 4. Section 42-10-10 NMSA 1978 (being Laws 1971, Chapter 215, Section 7, as amended) is amended to read:
"42-10-10. EXEMPTION IN LIEU OF HOMESTEAD.--
A. Any resident of this state who does not own a homestead shall in addition to other exemptions hold exempt real or personal property in the amount of [five thousand dollars ($5,000)] twenty-five thousand dollars ($25,000) in lieu of the homestead exemption.
B. If the resident does not own a homestead, the sheriff or any other person or officer seeking to attach, execute or foreclose by judgment on property shall provide the resident with written notification of the resident's right to exemption in lieu of homestead as described in Subsection A of this section, together with a simple form by which the resident may designate that the resident is aware of the exemption and does or does not desire to claim the exemption. If the resident refuses to make the election provided for in this section, the sheriff, other person or officer shall proceed to attach, execute or foreclose on the resident's property. If the resident claims the exemption in lieu of homestead, the sheriff, other person or officer making attachment, execution or foreclosure by judgment shall file as part of the return a description, including the resident's stated value, of the property claimed as exempt, bearing the resident's signature witnessed by the sheriff, other person or officer seeking to attach, execute or foreclose."
SECTION 5. A new Section 42-10-14 NMSA 1978 is enacted to read:
"42-10-14. [NEW MATERIAL] COST-OF-LIVING ADJUSTMENTS.--
A. On July 1, 2022, and at each two-year interval ending on July 1 thereafter, each dollar amount provided for in Sections 42-10-1, 42-10-4, 42-10-9 and 42-10-10 NMSA 1978 shall be adjusted to reflect the change in the consumer price index for all urban consumers as published by the United States department of labor for the most recent two-year period ending immediately before such January 1 preceding such July 1. The dollar amount shall be adjusted to the twenty-five-dollar ($25.00) increment nearest to the dollar amount that represents such change.
B. Adjustments made in accordance with Subsection A of this section shall not apply to legal proceedings commenced prior to the date of such adjustments."
SECTION 6. REPEAL.--Section 42-10-2 NMSA 1978 (being Laws 1971, Chapter 215, Section 2, as amended) is repealed.
SECTION 7. APPLICABILITY.--The provisions of this act apply to actions filed on or after July 1, 2020.
SECTION 8. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2020.
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