Tax Relief: Up to $1,000 One-Time Direct Payment Tax Will Be Sent to Residents in New Mexico

New Mexico residents could receive a one-time direct payment of up to $1,000 if House Bill 547 is signed into law by Governor Michelle Lujan Grisham.

$1,000 one-time direct payment as part of a tax relief package will be sent to taxpayers in New Mexico. (Photo: MARCA)

Tax Relief Bill in New Mexico

The $1.1 billion tax relief bill would provide rebates for all state residents who paid income tax in 2021, with single filers earning $500 and joint filers receiving $1,000. The payments would be made regardless of income status, and would mirror last year’s payments, although last year’s payments were smaller and had income thresholds.

Grisham has until April 7 to approve the legislation, and she has expressed her support for supporting New Mexicans who are facing inflation. The bill would also cut personal taxes for New Mexicans entirely, and increase the refundable child tax credit, making tax credits worth up to $600 per child available, according to a published article in The U.S. Sun.

Veterans and retirees would receive a tax exemption on military retirement pay of up to $10,000 in 2022, and this amount would increase to $30,000 in 2024. The proposed legislation also offers sustainable credits for the purchase of an electric vehicle, with payments of $2,000 for residents or $4,000 for those who meet certain low-income qualifications.

READ ALSO: Up To $1,500 In Tax Rebates: New Mexico Governor Proposes

Other Provisions in the Package

The tax package includes a higher alcohol excise tax, with the funds going towards programs addressing drug and alcohol use throughout New Mexico. The state is also offering incentives to boost activity in the film industry, with the total cost of the incentives estimated to be at least $90 million annually.

State lawmakers broadly supported the legislation on a bipartisan basis, although some had concerns about the scale of the film industry incentives, and whether they would be sustainable if the oil and gas industry were to slow down.

It is not yet clear when the checks would be sent out, as this depends on how quickly Grisham approves the rebates. However, the proposed legislation aims to support those who may be most at risk, such as low-income families with children, veterans, and retirees. Overall, the bill aims to help New Mexicans cope with the rising prices of gas, groceries, and other household expenses.

READ ALSO: New Mexico’s Bold Move: $1,500 Tax Rebates To Married Couples Amidst Rising Prices