New Mexico tax rebates: How much will you get?

SANTA FE, N.M. (KRQE) – Anywhere between $500 and $1,500 will hit most New Mexicans bank accounts over the next five months. The “free money” from the state government comes after New Mexico lawmakers passed two separate economic aid packages this year amid record oil revenues and rising costs of living, including high gas prices.

So how much money might you see in your own account? In an effort to help you figure it out, KRQE News 13 is breaking down the various stimulus packages state lawmakers have authorized to go out in 2022.

Some of the money is coming from a bill lawmakers passed during a regular legislative session in February 2022. Lawmakers also passed a second package on April 5, 2022, after gathering in Santa Fe for a single-day special legislative session.

Governor Michelle Lujan Grisham has already signed the latest legislation passed on April 5. So, what funds are on the way? We’ll start with money coming from the special session’s House Bill 2.

Two-part tax rebates: $500 to $1,000 split into two payments

The special session’s House Bill 2 lays out either $500 or $1,000 payments for New Mexicans that will be split into two parts. How much you will get will depend on your tax filing status.

Heads of household, surviving spouses and married individuals filing joint returns will receive a total of $1,000. Individual filers and married individuals filing taxes separately will get a total of $500.

Again those payments will be split into two parts. The first payment is supposed to come “as soon as possible.” The legislation formally outlines its delivery as “no later than June 30, 2022.”

Joint filers will receive $500 for the first payment. Single filers will receive $250 for the first payment.

The second payment of the two-part rebate will come sometime in the month of August. As with the first payment, how much you get depends on filing status. Joint filers will get $500 and individual filers will get $250.

Does everyone get rebates in HB2?

For the most part, yes. State lawmakers declined to include any income limits in House Bill 2, meaning the state will provide cash payouts to people regardless of how much money they make.

Can people who don’t file taxes get a rebate?

If you don’t make enough money to file taxes, you can still get some cash from the state. House Bill 2 provides a so-called “relief payment” to fill in the gaps. There’s also an application process and a limited amount of cash the government will send out.

Relief payments for non-tax filers are on a first-come, first-serve basis. And they’ll only last until a $20 million fund is exhausted. Applicants will be required to give a social security number or individual taxpayer identification number to the state for proof of identification.

The relief payment will be the same size as the two-part rebate. $1,000 will go to households of married couples or single individuals with one or more dependents. For households of single individuals without dependents, the payment is $500.

Only people who aren’t eligible for the standard two-part rebate will be eligible for the so-called “relief payment” for non-tax filers. And you have to be at least 18 years old during some of 2021 to qualify. Dependents are not eligible for the payment.

To get a relief payment, if you meet the requirements, you’ll have to fill out an application with the Human Services Department. The department is planning on announcing the application process within the next few weeks, according to Jodi McGinnis Porter, the communications director for the Human Services Department.

House Bill 2 says that if people apply by May 31, 2022, can expect payment no later than the end of July.

What if I have tax debts? Will I still get a payout?

If you owe the state, it’s possible that you won’t see the funds hit your bank account. Instead, the payments will likely be intercepted by the Taxation and Revenue Department to be used towards paying off your debt.

So, the funds will still ultimately help your accounts. But you’ll have less personal control over how exactly the funds are used. If there are leftover rebate funds after the state pays off your debt, the extra will be refunded to you.

It’s worth noting that a similar rebate interception happened to some people who received state tax rebate checks in 2021. At the time, about 2.7% of the 2021 tax relief went towards paying off debt, according to the LFC.

Will the rebates affect which tax bracket I’m in?

No. The two-part rebates will not be counted in federal or state adjusted gross income, according to an LFC fiscal report. So, it won’t affect your income tax bracket.

For the same reason, the tax rebate also won’t affect eligibility for income-based support programs at either the federal or state level, according to the LFC. But the rebates could impact your eligibility for privately financed support, depending on how those private support providers determine who’s eligible.

You mentioned another rebate lawmakers passed in the regular session? Is that still on the way?

Yes! Earlier this year, legislators approved House Bill 163, which includes some rebates. These rebates also have income limits, so fewer people will receive them.

The bill gives single or married individuals filing separately a $250 tax rebate if they make less than $75,000 a year. Married individuals and some other New Mexicans are eligible for a $500 rebate if they make less than $150,000 a year.

These rebates are expected to be dolled out in July 2022, according to state. The $250 or $500 rebates from HB 163 will be in addition to the $500 or $1,000 rebates passed as part of HB 2 in the special session.

I’ve also heard about a new child tax credit in New Mexico, what’s that?

House Bill 163 from the state’s 2022 regular session also approved a child tax credit. This credit is on a sliding scale ranging from $25 to $175 per child. How much you get depends on your gross adjusted income. If you make under $25,000 a year, you would qualify for $175 per child. If you make between $75,000 and $100,000 you qualify for $100 per child.

The child tax credit begins on January 1, 2023. To get the credit, New Mexico residents will have to apply to the Taxation and Revenue Department. If approved, you won’t receive a check per child, but instead, the credit will be applied to what you pay in taxes.

Are there any other, older tax credit or rebate programs?

On top of credits and rebates enacted this year, the state continues to operate some rebate programs enacted in previous years. For example, in 2019, state legislators created a tax deduction for dependents. That deduction adds up to about $28 million per year, according to the LFC.

On top of state programs, there are also federal credits. For example, the Human Services Department notes that some people might still be able to receive a 2021 Child Tax Credit — but you must file your taxes by April 18, 2022 to receive the credit.