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2025 CIT-CR Instructions

CIT-CR Instructions - 1 - www.tax.newmexico.gov 2025 New Mexico Instructions for Form CIT-CR

NEW MEXICO TAX CREDIT SCHEDULE

Using Schedule CIT-CR Use Schedule CIT-CR to claim business-related tax credits you may take against New Mexico corporate income tax reported on the 2025 CIT-1 New Mexico Corporate Income and Franchise Tax Return. On CIT-CR you may also claim any portion of refundable tax credits approved by the Department-film production tax credit, renewable energy production tax credit, and technology jobs and research and development tax credit. Claiming Credits Follow these general steps to claim non-refundable credits to apply to the tax liability and any refundable credits:

  1. Complete CIT-CR with up to 5 credits.
  2. If you are claiming more than 5 credits, complete CIT-CR

Supplemental for the 6th and any additional credits, and then attach CIT-CR Supplemental to the CIT-CR form.

  1. Transfer the total in CIT-CR, line A, to CIT-1, line 21.
  2. Transfer the total in CIT-CR line B, to CIT-1, line 38.

Contents Using Schedule CIT-CR .......................................................................................................................1 Claiming Credits ..................................................................................................................................1 Completing CIT-CR ..............................................................................................................................2 Tax Credit Types ...................................................................................................................................2 Affordable housing tax credit (A01) ......................................................................................................3 Advanced energy tax credit (A04) (Repealed Effective July 1, 2023) ..................................................3 Agricultural biomass income tax credit (A05) .......................................................................................4 Advanced energy equipment tax credit (A07) ....................................................................................... 4 Corporate child care tax credit (C02) (Repealed July 1, 2025) ............................................................4 Clean car tax credit (C03)..................................................................................................................... 5 Clean car charging unit tax credit (C04) ............................................................................................... 5 Film production tax credit (F01) ............................................................................................................6 Foster youth employment corporate income tax credit (F02) (Repealed July 1, 2025) ........................ 6 New film production tax credit (F03) .....................................................................................................7 New Mexico film partner new film production tax credit (F04) ..............................................................7 Geothermal ground-coupled heat pump tax credit (G01) ..................................................................... 8 Intergovernmental business tax credit (G02)........................................................................................ 8 Geothermal ground-coupled heat pump corporate tax credit (2024) (G04) .........................................9 Geothermal electricity generation tax credit (G05) ...............................................................................9 Job mentorship tax credit (J01)(Repealed July 1, 2025) ...................................................................... 9 Land conservation incentives credit (L01) .......................................................................................... 10 Preservation of cultural property credit (P01) ..................................................................................... 10 Rural job tax credit (R01).................................................................................................................... 11 Renewable energy production tax credit (R03) ..................................................................................11 Sustainable building tax credit (S02) (Repealed July 1, 2025) ...........................................................12 2015 sustainable building tax credit (S03) (Repealed December 31, 2024) ...................................... 12 2021 sustainable building tax credit (S05).......................................................................................... 13 Technology jobs and research and development tax credit (additional) (T02) ................................... 13

CIT-CR Instructions - 2 - www.tax.newmexico.gov

CIT-CR INSTRUCTIONS

  1. Attach the appropriate backup documentation to support the credit(s) taken and then attach CIT-CR to the CIT-1 return.

Most credits require additional documents specific to the credit. For a full list of required documents for a credit, see the instructions for the credit. How Much Can You Claim? To calculate the amount you can claim for a credit, refer to the claim form or to the instructions for the credit. Tax Credit Information and Forms These CIT-CR instructions give information about each tax credit. For a complete description of the credits, see Publication FYI-106, Claiming Business-Related Tax Credits for Individuals and Businesses. For tax credit forms, instructions, and FYI-106, click https://www.tax.newmexico.gov/forms-publications/ . This takes you to the Forms & Publications web page. To find tax credit forms and instructions on the web page, do the following:

  1. Click the Income Taxes folder.
  2. Click Corporate Income Tax (CIT).
  3. Then click Credits.

To find FYI-106 on the Forms & Publications page, do the following:

  1. Click the Publications folder.
  2. Click FYIs.
  3. Then click FYI-106 - Claiming Business-Related Tax

Credits for Individuals and Businesses. Completing CIT-CR Lines 1 through 5 For each credit you claim, complete one line. In the four columns for each line, described next in this section, enter all the following: ● Credit type code ● If applicable, credit approval number ● Amount to apply to the tax due on the return ● Any amount of the credit to refund to you Column A Credit Type Code This is the code with three alphanumeric characters in front of each credit listed on Schedule CIT-CR. An entry in this field is required. Column B Credit Approval Number An approval number is not available for all credits. And for some credits, an approval number is not required. The instructions specify the number to use for each credit or instruct you to leave the column blank. IMPORTANT: If you are claiming multiple credits for the same credit type, list each credit separately as illustrated in the next example. Example Taxpayer X received investment vouchers 123456-1 and 123456-2 for two separate affordable housing tax credits. X's return shows a liability of $80 before applying any tax credits. X wants to use the remaining $50 from the available carryforward on voucher 123456-1, and $30 from voucher 123456-2. On line 1, X does the following in each column: ● Column A. Enters A01. ● Column B. Enters 123456-1. ● Column C. Enters $50. ● Column D. Leaves blank. The affordable housing tax credit is not refundable. On line 2, X does the following in each column: ● Column A. Enters A01. ● Column B. Enters 123456-2. ● Column C. Enters $30. ● Column D. Leaves blank. The affordable housing tax credit is not refundable. Column C Amount Claimed to Apply to Tax Due On line A, enter the sum of all column C amounts on CIT-CR and, if you used any, on all CR Supplemental pages. Column D Amount of Credit to Refund On line B, enter the sum of all column D amounts on CIT-CR and, if you used any, on all CR Supplemental pages. Tax Credit Types Descriptions of each tax credit Each type of credit is described next and includes the following information, as applicable: • Whether the credit is refundable • If you can carry it forward and for how long • How to apply for the credit • How to claim the credit. Affordable Housing Tax Credit (A01) Beginning January 1, 2006, the Mortgage Finance Authority

CIT-CR Instructions - 3 - www.tax.newmexico.gov (MFA) determines eligibility, approves affordable housing projects for MFA or for a trust fund administered by MFA, and issues an investment voucher to a taxpayer who made an investment of land, buildings, materials, cash, or services for an affordable housing project. Definition Affordable housing covers land acquisition, construction, building acquisition, remodeling, improvement, rehabilitation, conversion, or weatherization for single-family or multi-family residential housing approved by MFA. Investment Vouchers The vouchers are good for up to 50% of the investment. After receiving a voucher from MFA, the taxpayer may apply the credit against gross receipts, compensating, withholding, or personal, fiduciary, or corporate income tax liabilities. If you notify MFA about a sale or transfer and MFA reissues a voucher to the transferee, you may sell or transfer the voucher. Carry Forward for Five Years This credit is not refundable, but you can carry unused credits forward for five years. To claim this credit, follow these steps:

  1. Complete RPD-41301, Affordable Housing Tax Credit

Claim Form. ● Column A. Enter A01. ● Column B. Enter the credit number assigned by MFA on the investment voucher. If the voucher was transferred to you, enter the new voucher number assigned by MFA. ● RPD-41301 ● Copies of the vouchers received from MFA To learn more about MFA, visit www.housingnm.org or call (505) 843-6880 or toll free (800) 444-6880.

Advanced Energy Tax Credit (A04) (Repealed Effective July 1, 2023) A taxpayer who holds an interest in a qualified electric generating facility located in New Mexico may be eligible to apply for and claim the advanced energy tax credit. Credit Limitations The amount of the credit is 6% of the eligible generation plant costs. The aggregate amount of tax credit that may be claimed with respect to a qualified generating facility is limited to $60,000,000. Carry Forward for 10 Years This credit is not refundable, but if the credit amount exceeds the tax liability, you can carry forward the unused credit for up to 10 years. Allocating the Right to Claim This Credit You may allocate the right to claim this credit to other taxpayers who are interest owners in the qualified electric generating facility. To allocate the credit to interest owners ● Complete the Notice of Allocation of Right to Claim Advanced Energy Tax Credits. This notice is the third page of RPD-41333, Advanced Energy Tax Credit Application. After you receive the certificate of eligibility from the New Mexico Environment Department (NMENV), follow these steps:

  1. Complete RPD-41333, Advanced Energy Tax Credit

Application.

  1. Attach the certificate of eligibility that NMENV issued.
  2. Within one year following the end of the calendar year in which the eligible generation plant costs were incurred, submit the following: ● RPD-41333 ● If you are allocating the credit to interest owners, the notice on the third page of RPD-41333 ● All other attachments

After you receive approval, you can claim the credit by following these steps:

  1. Complete RPD-41334, Advanced Energy Tax Credit Claim

Form. ● Column A. Enter A04. ● Column B. Enter the number the Taxation and Revenue Department issued. The number is identified on the credit approval letter. If the letter does not show a credit approval number, leave this box blank. ● RPD-41334 ● Approval letter from NMENV

CIT-CR Instructions - 4 - www.tax.newmexico.gov To learn more, visit https://www.env.nm.gov or call (505) 827-2855 or toll free (800) 219-6157. Agricultural Biomass Income Tax Credit (A05) A credit is available for a taxpayer who owns a dairy or feedlot and who files a personal, fiduciary, or corporate income tax return for a taxable year beginning on or after January 1, 2011, and ending before January 1, 2030. Credit Amount The Department may allow a credit equal to $5 per wet ton of agricultural biomass transported from the taxpayer's dairy or feedlot to a facility that uses agricultural biomass to generate electricity or makes biocrude or other liquid or gaseous fuel for commercial use. Carry Forward for Four Years Excess credit is not refundable, but you can carry it forward for a maximum of four consecutive tax years following the year the Department approved the credit. You must first obtain a certificate of eligibility from New Mexico Energy, Minerals and Natural Resources Department (EMNRD) to qualify for this credit. When EMNRD issues you a certificate of eligibility, obtain approval from the Department by submitting to the Department a completed RPD-41362, Agricultural Biomass Tax Credit Approval, and the certificate of eligibility. The Department approves the credit and returns the approved form to the owner or holder. After you receive approval, you can claim the credit by following these steps:

  1. Complete RPD-41361, Agricultural Biomass Tax Credit

Claim Form. ● Column A. Enter A05. ● Column B. Enter the credit number the Department assigned on RPD -41362, Agricultural Biomass Tax Credit Approval. If the tax credit was transferred to you, enter the new credit number on RPD-41363, Notice of Transfer of Agricultural Biomass Tax Credit. ● RPD-41361 ● Copy of certificate of eligibility that EMNRD issued To learn more, visit https://www.emnrd.nm.gov or call (505) 476-3200. Advanced Energy Equipment Tax Credit (A07) A taxpayer who makes qualified expenditures for a qualified manufacturing facility located in New Mexico and who files an individual New Mexico income tax return for a taxable year beginning on or after January 1, 2025, and prior to January 1, 2033, may claim the tax credit. Prior to incurring a qualified expenditure, the taxpayer shall apply for preliminary certification of eligibility for the tax credit from the Energy, Minerals and Natural Resources Department (EMNRD) and with consultation with the Economic Development Department (EDD). Within twelve months of commencement of production of an any advanced energy equipment product, the taxpayer shall seek final certification from EMNRD before claiming this credit. To apply for the credit, contact EMNRD at (505) 476-3310, or visit their web site https://www.emnrd.nm.gov. To consult with EDD about qualifying potential expenditures being used to produce in whole or in part advanced energy products, contact EDD by visiting their website https://edd.newmexico.gov/. Sold, Exchange, or Transfers A certificate of eligibility for the tax credit may be sold, exchanged, or otherwise transferred to another taxpayer in increments of not less than $1,000,000. A certificate of eligibility less than $1,000,000 must be transferred in entirety. The Taxation and Revenue Department shall be notified of the sale, exchange, or transfer within ten days. When you receive the final certification from EMNRD, follow these steps to claim the credit:

  1. Complete TRD-41429, Advanced Energy Equipment Tax

Credit Claim Form.

  1. Complete CIT-CR. In the Credit Approval Number box, enter the certificate number shown on the certificate of eligibility

EMNRD issued to you.

  1. Attach the following to your CIT-1:

• TRD-41429 • CIT-CR • A copy of the final certification from EMNRD

  1. Submit your CIT-1 and all attachments.

Any amount of credit that exceeds the taxpayer's income tax liabilities may be carried forward for five consecutive taxable years. The advanced energy equipment tax credit is non-refundable. IMPORTANT: To claim this credit, you must have a certificate of eligibility from EMNRD issued to you. Corporate Child Care Tax Credit (C02) (Repealed Effective July 1, 2025) Corporations providing or paying for licensed childcare services for employees' children under 12 years of age may deduct 30% of eligible expenses from their corporate income tax liability for the tax year in which the expenses occur, not

CIT-CR Instructions - 5 - www.tax.newmexico.gov to exceed $30,000. Carry Forward for Three Years An amount exceeding the tax liability is not refundable, but you can claim a carryforward of the credit for three consecutive years. To claim this credit, follow these steps:

  1. Complete CIT-3, Corporate Child Care Credit. ● Column A. Enter C02. ● Column B. Enter the last day of the tax year when the credit was first eligible to claim. ● CIT-3

Clean Car Tax Credit (C03) The clean car tax credit may be claimed by a taxpayer who files a New Mexico Personal Income Tax, Fiduciary Income Tax, Corporate Income Tax, or Sub-Chapter S-Corporate Income and Franchise Tax return for a tax year beginning on or after January 1, 2024, and has purchased or entered into a new lease for a minimum of at least three years a qualified electric vehicle, plug-in hybrid electric vehicle, or fuel cell vehicle on or after May 15, 2024, but before January 1, 2030. The taxpayer must apply for a certification of eligibility with the Energy, Minerals and Natural Resources Department (EMNRD) before claiming this credit. To apply for the credit, contact the Energy Conservation and Management Division of EMNRD at (505) 476-3310, or visit their web site https:// www.emnrd.nm.gov. Applications for certification of the tax credit shall be made no later than one year from the date on which the vehicle is purchased or the lease is entered into. Credits Sold, Exchange, or Transferred When a holder or owner sells, exchanges, or transfers a Clean Car Tax Credit form TRD-41420, Notice of Transfer of Clean Car Tax Credit, must be used to notify the Department of a transfer of an approved clean car tax credit. The Department issues the new holder an approval for the credit transfer, a new credit number, and instructions for applying the credit to tax due. This credit must be transferred in full. If the credit has been partially claimed, it can no longer be transferred. After you receive the certificate of eligibility, you can claim the credit by following these steps:

  1. Complete Form TRD-41419, Clean Car Tax Credit Claim

Form.

  1. Complete CIT-CR. In the Credit Approval Number box, enter the certificate number EMNRD issued to you.
  2. Attach the following to your CIT-1: ● TRD-41419 ● Copy of certificate of eligibility from EMNRD
  3. Submit your CIT-1 and all attachments.

Any credit claimed that is over the taxpayer's liability shall be refunded. The credit can be sold, exchanged, or transferred to another taxpayer for the full value of the credit. The credit shall be claimed within three taxable years of the end of the year in which EMNRD certifies the credit. Allocation to Owners A taxpayer may allocate the right to claim the tax credit in proportion to the taxpayer's ownership interest if the taxpayer owns an interest in a business entity that is taxed for federal income tax purposes as a partnership or limited liability company and that business entity has met all of the requirements to be eligible for the credit. The total credit claimed by all members of the partnership or limited liability company shall not exceed the allowable credit. Clean Car Charging Unit Tax Credit (C04) The clean car charging unit tax credit may be claimed by a taxpayer who files a New Mexico Personal Income Tax, Fiduciary Income Tax, Corporate Income Tax, or Sub-Chapter S Corporate Income and Franchise Tax return for a tax year beginning on or after January 1, 2024 and has purchased and installed an electric vehicle charging unit or fuel cell charging unit in New Mexico on or after May 15, 2024, but before January 1, 2030. The taxpayer must apply for a certification of eligibility with the Energy, Minerals and Natural Resources Department (EMNRD) before claiming this credit. To apply for the credit, contact the Energy Conservation and Management Division of EMNRD at (505) 476-3310, or visit their web site https://www. emnrd.nm.gov. A taxpayer that claims the 2021 sustainable building tax credit for expenses of purchasing and installing an electric vehicle charging unit or fuel cell charging unit cannot claim the clean car charging unit tax credit. After you receive the certificate of eligibility, you can claim the credit by following these steps:

  1. Complete Form TRD-41421, Clean Car Charging Unit Tax

Credit Claim Form.

  1. Complete CIT-CR. In the Credit Approval Number box, enter the certificate of eligibility number issued by EMNRD.
  2. Attach the following to your CIT-1: ● TRD-41421

CIT-CR Instructions - 6 - www.tax.newmexico.gov ● Copy of certificate of eligibility from EMNRD

  1. Submit your CIT-1 and all attachments.

Any credit claimed that is over the taxpayer's liability shall be refunded. The credit shall be claimed within three taxable years of the end of the year in which EMNRD certifies the credit. Allocation to Owners A taxpayer may allocate the right to claim the tax credit in proportion to the taxpayer's ownership interest if the taxpayer owns an interest in a business entity that is taxed for federal income tax purposes as a partnership or limited liability company and that business entity has met all of the requirements to be eligible for the credit. The total credit claimed by all members of the partnership or limited liability company shall not exceed the allowable credit. Film Production Tax Credit (F01) For film companies that commence principal photography prior to January 1, 2016, a credit is available in an amount equal to 25% of direct production and direct postproduction expenditures made in New Mexico that are subject to taxation and directly attributable to the production of a film or commercial audiovisual product. An additional 5% credit is allowed for certain direct production expenditures made for qualifying productions. Excluded from the credit are costs for which the film production company has already executed a nontaxable transaction certificate under Section 7-9-86 NMSA 1978. To obtain approval for the credit, first apply to the New Mexico Film Office, a division of the EDD. After the film production company receives approval from EDD, the company must apply to the Department for credit approval. See RPD-41229, Application for Film Production Tax Credit. When the company is approved, you may claim the credit by filing a personal, fiduciary, or corporate income tax return. Claim the credit by following these steps:

  1. Complete RPD-41228, Film Production Tax Credit Claim

Form. ● Column A. Enter F01. ● Column B. Enter the credit approval number that the Department issued. The number is identified on the credit approval letter. If the letter does not show a credit approval number, leave this box blank. ● Column D. If you are eligible for a refund, enter the amount to refund. ● RPD-41228

NOTE: The amount of film production tax credit you may claim against the tax due on this return and the amount you may receive as a refund (based on the claim for the film production tax credit) are subject to certain limitations governing the payment of film production tax credit claims. For details about these limitations and how the claim may be impacted, see the instructions for RPD-41228, Film Production Tax Credit Claim Form. To learn more about the film credit, visit www.nmfilm.com or call (505) 476-5600. Foster Youth Employment Corporate Income Tax Credit (F02) (Repealed Effective July 1, 2025) For tax years beginning on or after January 1, 2018, a taxpayer who employs a qualified foster youth for at least 20 hours per week in New Mexico is eligible for a credit against the taxpayer's personal or corporate income tax liability for up to $1,000 for wages paid to each qualified foster youth. If the foster youth's qualified period of employment is less than a full year, the credit for that year is reduced based on the ratio of the qualified period of employment over the full tax year of the employer. Requirements The following are the requirements for this credit: • An employer may not receive the credit for any individual qualified foster youth for more than one calendar year from the date of hire. • Only one employer may receive the credit for a qualified foster youth during a tax year. • The qualified foster youth was aged fourteen or older within seven years prior to the taxable year for which the tax credit is claimed and was in the legal custody of either the Children, Youth and Families Department (CYFD) pursuant to the Children's Code or in the legal custody of a New Mexico Indian Nation, Tribe or Pueblo, or the United States (US) Department of the Interior Bureau of Indian Affairs (BIA) Division of Human Services. • The foster youth employment tax credit is only allowed for the employment of a foster youth who was not previously employed by the taxpayer prior to the taxable year for which the credit is claimed.

Carry Forward for Three Years Excess credit is not refundable, but you may carry it forward for up to three years. This credit cannot be transferred to another taxpayer, but it can be allocated based on a taxpayer's ownership interest in a business. Before Applying for This Credit

C I T - C R I n s t r u c t i o n s - 7 - www.tax.newmexico.gov The qualified youth will have to contact the Children, Youth, and Families Department's (CYFD) Family and Youth Services Bureau at (505) 827-8400 or the other agency which had legal custody of the qualified youth. That government agency, department, or bureau will have to send a letter or certificate to the qualified youth that includes their name, date of birth, and the date custody began. To apply for the credit, follow these steps:

  1. For each eligible foster youth you employed in the tax year, complete RPD-41388, Certification of Eligibility for the Foster Youth Employment Tax Credit. Attach the letter or certificate received from the government agency, department, or bureau showing the date custody begin for the qualified youth.
  2. On RPD-41389, Application for Foster Youth Employment

Tax Credit, show the number of certifications and enter the other required information to establish that you retain the status of an eligible employer.

  1. Complete all other sections of RPD-41389.
  2. Submit the following to the Department: ● RPD-41389 ● An RPD-41388 for each eligible foster youth you employed during the tax year.

When you receive approval from the Department, follow these steps to claim the credit:

  1. Complete RPD-41390, Foster Youth Employment Tax

Credit Claim Form. ● Column A. Enter F02. ● Column B. Enter the credit approval number shown on the approved RPD-41389, Foster Youth Employment Tax Credit Application. ● RPD-41390 New Film Production Tax Credit (F03) For film companies that commence principal photography on or after July 1, 2019, a credit is available in an amount equal to 25% of direct production and direct postproduction expenditures made in New Mexico that are subject to taxation and directly attributable to the production of a film or commercial audiovisual product. An additional 5% credit is allowed for certain direct production expenditures made for qualifying productions or for standalone pilots intended for series television. In addition, a 105% credit may also be allowed for production expenditures in areas at least 60 miles from the City Hall of the county seat for Bernalillo or Santa Fe counties. Excluded from the credit are costs for which the film production company has already executed a nontaxable transaction certificate under Section 7-9-86 NMSA 1978. NOTE: If you are a New Mexico film partner, refer to F04 New Mexico Film Partner New Film production tax credit to claim your credit. To obtain approval for the credit, first apply to the New Mexico Film Office, a division of the EDD. After the film production company receives approval from EDD, the company must apply to the Department to get Department approval of the credit. See Form RPD-41391, Application for New Film Production Tax Credit. When you are approved, you may claim the credit by filing your personal or corporate income tax return. You can claim the credit by following these steps:

  1. Complete Form RPD-41228, Film-Related Tax Credit

Claim Form.

  1. Complete CIT-CR. In the Credit Approval Number box, enter the credit approval number that the Department issued. The number is identified on your credit approval letter. If the letter does not show a credit approval number, leave this box blank.
  2. Attach the following to your CIT-1:

• RPD-41228 • CIT-CR

  1. Submit your CIT-1 and all attachments

New Mexico Film Partner New Film Production Tax Credit (F04) This credit applies to film production companies that are defined as New Mexico film partners that have made a commitment to produce films or commercial audiovisual products in New Mexico and have purchased or executed a 10 year contract to lease a qualified production facility. Limitations to certification of a claim in excess of the aggregate amount of claims provided by the Film Production Tax Credit Act does not apply to the certification of a budget for a New Mexico film partner. New Mexico film partners that commence principal photography on or after July 1, 2019, a credit is available in an amount equal to 25% of direct production and direct postproduction expenditures made in New Mexico that are subject to taxation and directly attributable to the production of a film or commercial audiovisual product. An additional 5% credit is allowed for certain direct production expenditures made for qualifying productions or for standalone pilots intended for series television. In addition, a 105% credit may also be allowed for production expenditures in areas at least 60 miles

C I T - C R I n s t r u c t i o n s - 8 - www.tax.newmexico.gov from the City Hall of the county seat for Bernalillo or Santa Fe counties. Excluded from the credit are costs for which the film production company has already executed a nontaxable transaction certificate under Section 7-9-86 NMSA 1978. To obtain approval for the credit, first apply to the New Mexico Film Office, a division of the EDD. After the film production company receives approval from EDD, the company must apply to the Department to get Department approval of the credit. See Form RPD-41391, Application for New Film Production Tax Credit. When you are approved, you may claim the credit by filing your personal or corporate income tax return. You can claim the credit by following these steps:

  1. Complete Form RPD-41228, Film-Related Tax Credit

Claim Form.

  1. Complete CIT-CR. In the Credit Approval Number box, enter the credit approval number that the Department issued. The number is identified on your credit approval letter. If the letter does not show a credit approval number, leave this box blank.
  2. Attach the following to your CIT-1:

• RPD-41228 • CIT-CR

  1. Submit your CIT-1 and all attachments

Geothermal Ground-Coupled Heat Pump Tax Credit (G01) A credit is available for a taxpayer who purchased and installed a geothermal ground-coupled heat pump after January 1, 2010, but before December 31, 2020. To qualify for the tax credit, you must install the pump in a residence, business, or agricultural enterprise in New Mexico that you own or that a partnership or other business entity of which you are a member owns. Credit Limitations The credit, which may not exceed $9,000, is available for up to 30% of the purchase and installation costs. Carry Forward for 10 Years This credit is not refundable, but you can carry forward unused credit for a maximum of 10 consecutive years following the tax year for which the credit was approved. To qualify for this credit, you must first obtain a certificate of eligibility from EMNRD. After you receive the certificate of eligibility, you can claim the credit by following these steps:

  1. Complete RPD-41346, Geothermal Ground-Coupled Heat

Pump Tax Credit Claim Form. ● Column A. Enter G01. ● Column B. Enter the certificate number EMNRD issued to you. ● RPD-41346 ● Copy of certificate of eligibility from EMNRD To learn more, visit https://www.emnrd.nm.gov or call (505) 476-3200. Intergovernmental Business Tax Credit (G02) A corporation engaged in growing, processing, or manufacturing may receive a credit for up to 50% of all taxes imposed by an Indian nation, tribe, or pueblo, located wholly or partly in New Mexico, on income from new business activity on Indian land. Credit Exceptions and Limitations A tax eligible for credit under Section 7-29C-1 NMSA 1978, or any other intergovernmental business tax credit that provides a similar credit, may not be counted for intergovernmental business tax credit. Examples of such taxes are the following: ● Oil and gas severance tax ● Oil and gas conservation tax ● Oil and gas emergency school tax ● Oil and gas ad valorem production tax on products severed from Indian tribal land ● Tax imposed on the privilege of severing products from tribal land The law limits the credit to income from a new business established on tribal land after July 1, 1997. A new business is a manufacturer or processor occupying a new business facility or a grower who begins operations in New Mexico after July 1, 1997. To claim this credit, follow these steps:

  1. Complete a statement establishing entitlement to the credit with proof of payment of tax to an Indian nation, tribe, or pueblo on which the credit is based. ● Column A. Enter G02.

CIT-CR Instructions - 9 - www.tax.newmexico.gov ● Column B. Leave blank. A credit approval number is not required to claim this credit. ● Entitlement statement Geothermal Ground-Coupled Heat Pump Corporate Income Tax Credit (2024) (G04) The geothermal ground-coupled heat pump income tax credit may be claimed by a taxpayer who files a New Mexico personal or fiduciary income tax return for a tax year beginning on or after January 1, 2024, and has purchased and installed a geothermal ground-coupled heat pump after May 15, 2024, but before December 31, 2034, in a residence, business or agricultural enterprise in New Mexico owned by that taxpayer, or owned by a partnership or other business association of which the taxpayer is a member. The credit, which may not exceed $9,000, is available for up to 30% of the purchase and installation costs. This Credit Is Refundable The credit is applied to the taxpayer's tax liability in the tax year it is claimed. The remaining amount is refunded to the taxpayer. To qualify for this credit, you must first obtain a certificate of eligibility from EMNRD. The tax credit is allowed only for geothermal ground-coupled heat pumps that are installed by a nationally accredited ground source heat pump installer certified by EMNRD. EMNRD may allow a maximum annual aggregate of $4,000,000 in geothermal ground-coupled heat pump income tax credits. Applications for the credit are considered in the order received by EMNRD. The taxpayer must attach to the return a completed TRD- 41427 and a copy of the letter from EMNRD certifying the geothermal ground-coupled heat pump and approving the taxpayer for the credit.

  1. Complete Form TRD-41427, Geothermal Ground-

Coupled Heat Pump Corporate Income Tax Credit Claim Form (2024).

  1. Complete CIT-CR. In the Credit Approval Number box, enter the certificate number EMNRD issued to you.
  2. Attach the following to your CIT-1:

• TRD-41427 • CIT-CR • Copy of certificate of eligibility from EMNRD Geothermal Electricity Generation Tax Credit (G05) The geothermal electricity generation tax credit may be claimed by a taxpayer who holds an interest in a geothermal electricity generation facility in which electricity was generated in New Mexico on or after January 1, 2025, but before January 1, 2032. The amount of a tax credit allowed shall be an amount equal to one and one-half cents ($0.015) per kilowatthour of electricity generated in New Mexico in a taxable year by the geothermal electricity generation facility in which the taxpayer holds an interest. The total annual aggregate amount of credits that may be certified for geothermal electricity generation income tax credits and geothermal electricity generation corporate income tax credits in any calendar year is five million dollars ($5,000,000). Completed applications shall be considered in the order received. Applications for certification received after this limitation has been met in a calendar year shall not be approved for that calendar year, but shall be considered for certification in the following calendar year. Carry Forward for 3 Years This credit is not refundable, but you can carry forward unused credit for a maximum of 3 consecutive years. The taxpayer must apply for a certification of eligibility with the Energy, Minerals and Natural Resources Department (EMNRD) before claiming this credit. To apply for the credit, contact the Energy Conservation and Management Division of EMNRD at (505) 476-3310, or visit their web site https:// www.emnrd.nm.gov. The taxpayer must attach to the return a completed TRD- 41428 and a copy of the letter from EMNRD certifying the purchase and approving the taxpayer for the credit.

  1. Complete Form TRD-41428, Geothermal Electricity

Generation Tax Credit Claim Form.

  1. Complete CIT-CR. In the Credit Approval Number box, enter the certificate number EMNRD issued to you.
  2. Attach the following to the CIT-1 return:

• TRD-41428 • CIT-CR • Copy of certificate of eligibility from EMNRD

  1. Submit the CIT-1 return and all attachments to the

Department. Allocation to owners A taxpayer may allocate the right to claim the tax credit in proportion to the taxpayer's ownership interest if the taxpayer owns an interest in a business entity that is taxed for federal income tax purposes as a partnership or limited liability company and that business entity has met all of the requirements to be eligible for the credit. The total credit claimed by all members of the partnership or limited liability company shall not exceed the allowable credit. Job Mentorship Tax Credit (J01) (Repealed July 1, 2025) A taxpayer who owns a New Mexico business may claim a job mentorship tax credit for employing qualified students

CIT-CR Instructions - 10 - www.tax.newmexico.gov who take part in a school-sanctioned, career preparation education program. A partnership or other business entity of which the taxpayer is a member may claim a credit in proportion to the taxpayer's interest in the partnership or entity. Credit Limitations The credit equals 50% of gross wages paid to a maximum of 10 qualified students. The business must employ each student for up to 320 hours during the tax year. A taxpayer may not claim a credit for one qualified individual for more than three tax years. The maximum credit for one tax year is $12,000. Carry Forward for Three Years This credit is not refundable, but you may carry unused credit forward for three consecutive years. To apply for this credit, obtain RPD-41280, Job Mentorship Tax Credit Certificate, from the secondary school that operates the career preparation education program for each qualified student you employ. For help obtaining the certificate, contact the principal of the school that the student you employ attends. To claim this credit, follow these steps:

  1. Complete RPD-41281, Job Mentorship Tax Credit Claim

Form. ● Column A. Enter J01. ● Column B. Leave blank. A credit approval number is not required to claim this credit. ● RPD-41280 ● RPD-41281 Land Conservation Incentives Tax Credit (L01) Corporations that donate land or interest in land to private or public conservation agencies for conservation purposes may claim a credit up to the following amounts from personal, fiduciary, or corporate income tax equal to 50% of the fair market value of the land transferred: ● $100,000 for donations made before January 1, 2008 ● $250,000 for donations made on or after January 1, 2008 For a donation made after January 1, 2008, the corporation may sell, exchange, or transfer the credit in increments of $10,000 or more. Carry Forward for 20 Years Unused credit is not refundable, but you may carry it forward for up to 20 consecutive years following the year when the qualified donation occurred.

To apply for this credit, follow these steps:

  1. Contact EMNRD to certify the eligibility of the donation.
  2. After you receive the certificate of eligibility from EMNRD, complete RPD-41335, Land Conservation Incentives

Credit Application.

  1. Submit RPD-41335 and a copy of the certificate of eligibility to the Taxation and Revenue Department.

When you receive approval from the Department, follow these steps to claim the credit:

  1. Complete RPD-41282, Land Conservation Incentives Tax

Credit Claim Form. ● Column A. Enter L01. ● Column B. Enter the credit number the Department assigned on RPD-41335, Land Conservation Incentives Credit Application. If the credit was transferred, enter the new credit number assigned on RPD-41336, Notice of Transfer of Land Conservation Incentives Tax Credit. ● RPD-41282 ● Letter from EMNRD certifying treatment as a qualified donation To learn more,visit https://www.emnrd.nm.gov or call (505) 476-3200. Preservation of Cultural Property Tax Credit (P01) The credit for preservation of cultural property is 50% of the approved eligible costs of a project for the restoration, rehabilitation, or preservation of cultural property listed on the official New Mexico Register of Cultural Properties, not to exceed $25,000. Requirements and Limitations Before the restoration begins, the New Mexico Cultural Properties Review Committee must approve the project plan. When the restoration ends, the committee must certify that the completed project conforms to the plan. For tax years beginning on or after January 1, 2009, if the property is also certified by the State Coordinator of the New

CIT-CR Instructions - 11 - www.tax.newmexico.gov Mexico Arts and Cultural District Act as located within the boundaries of a state-certified or a municipally-certified arts and cultural district, pursuant to the Arts and Cultural District Act, a maximum of $50,000 credit is allowed. Carry Forward for Four Years An amount exceeding the tax liability is not refundable, but you may carry it forward for four consecutive years. To claim this credit after you receive approval, follow these steps:

  1. Complete CIT-4, New Mexico Preservation of Cultural

Property Credit. ● Column A. Enter P01. ● Column B. Enter the log number shown on the project approval letter the Historic Preservation Division issued to you. ● CIT-4 ● A copy of the letter of certification ● The Part 2 approval from the New Mexico Cultural Properties Review Committee ● If applicable, the approval from the New Mexico Arts and Cultural Districts coordinator To learn more about the New Mexico Cultural Properties Review Committee, visit https://www.nmhistoricpreservation. org/cprc.html or call (505) 827-6320. For information about New Mexico Arts and Cultural Districts, visit https://edd. newmexico.gov/ or call (505) 827-0168. Rural Job Tax Credit (R01) A rural job tax credit is available for employers in rural areas of New Mexico who qualify for Job Training Incentive Program (JTIP) assistance. Eligible employers may earn the rural job tax credit for each qualifying job created after July 1, 2000. The holder of the rural job tax credit may apply all or part of the credit against the holder's combined state gross receipts, compensating and withholding taxes, or personal, fiduciary, or corporate income tax. Calculating the Credit for Qualifying Periods A qualifying period is 12 months. Calculate the rural job tax credit at 6.25% of the first $16,000 in wages paid for each qualifying job for no more than: ● Four qualifying periods in a Tier 1 area ● Two qualifying periods in a Tier 2 area Rural Areas-Tier 1 and Tier 2 A rural area excludes Albuquerque, Corrales, Farmington, Las Cruces, Los Alamos County, Los Ranchos, Rio Rancho, Santa Fe, and Tijeras, and a 10-mile zone around these municipalities. Tier 2 areas are limited to Alamogordo, Carlsbad, Clovis, Gallup, Hobbs, and Roswell. Tier 1 is any rural area not part of a Tier 2 area. Carry Forward for Three Years An amount exceeding the tax liability is not refundable, but you may carry it forward for three consecutive years. To apply for the rural job tax credit, do the following:

  1. Complete RPD-41247, Certificate of Eligibility for the

Rural Job Tax Credit , to certify the wages paid to each eligible employee for each qualified job you claim in the eligible period.

  1. Take RPD-41247 to a notary to notarize.
  2. Complete RPD-41238, Application for Rural Job Tax

Credit.

  1. Send RPD-41247 and RPD-41238 to the address on

RPD-41238. After you receive approval from the Department, you can claim the credit by following these steps:

  1. Complete RPD-41243, Rural Job Tax Credit Claim Form. ● Column A. Enter R01. ● Column B. Enter the credit approval number the

Department issued to you. The number is identified on the credit approval letter. If the letter does not show a credit approval number, leave this box blank. ● RPD-41243 To learn more about JTIP, visit the New Mexico EDD website at https://edd.newmexico.gov/, or call (505) 827-0300 or toll free (800) 374-3061. Renewable Energy Production Tax Credit (R03) Personal, fiduciary, and corporate income taxpayers receive credit for producing electricity by solar light or heat, wind, or biomass for an eligibility period of 10 consecutive years beginning on the date the qualified energy generator begins producing electricity. Deduct, Refund, or Carry Forward for Five Years

CIT-CR Instructions - 12 - www.tax.newmexico.gov This refundable credit is not currently available to apply for but you may deduct an existing credit from your corporate income tax liability. If the amount of the tax credit exceeds the corporate income tax liability for the tax year, one of the following is true: ● If the tax credit was issued with respect to a qualified energy generator that first produced electricity using a qualified energy resource on or after October 1, 2007, the state refunds the excess to you. ● You may carry forward the excess credit for five years. EMNRD must first approve the qualified energy generator and the business claiming the credit. To qualify, EMNRD requires the taxpayer to do one of the following: ● Hold title to a qualified energy generator that first produced electricity on or before January 1, 2018. ● Lease property upon which a qualified energy generator operates from a county or municipality under the authority of an industrial revenue bond. When you receive approval from EMNRD, follow these steps to claim the credit:

  1. Complete RPD-41227, Renewable Energy Production Tax

Credit Claim Form. ● Column A. Enter R03. ● Column B. Enter the last day of the tax year when the electricity was produced for which you are claiming a credit or a carryforward. ● Column D. If you are eligible for a refund, enter the amount to refund. ● RPD-41227 ● Certificate of eligibility from EMNRD ● Documentation showing the taxpayer's interest in the facility ● The annual Notice of Allocation from EMNRD, which includes the amount of electricity the facility produced ● Any other information the Department may require to determine the amount of tax credit due the taxpayer To learn more about the renewable energy credit, visit https:// www.emnrd.nm.gov or call (505) 476-3200. Sustainable Building Tax Credit (S02) (Repealed July 1, 2025) A taxpayer with qualified construction or renovations made after January 1, 2017 but ending on or before December 31, 2026, should contact the New Mexico Energy, Minerals and Natural Resources Department (EMNRD) to certify your eligibility to claim the New Sustainable Building Tax Credit. Carry Forward for 7 Years This non-refundable credit is not currently available to apply for but you can carry an existing credit forward for the maximum of 7 consecutive years from the first eligible year that the credit was approved to be claimed by the Department. When you receive approval from the Department, follow these steps to claim the credit:

  1. Complete RPD- 41329, Sustainable Building Tax Credit

Claim Form. ● Column A. Enter S02. ● Column B. Enter the credit number assigned by the Department on RPD-41327, Sustainable Building Tax Credit Approval. If the credit was transferred to you, enter the new credit number assigned on RPD-41342, Notice of Transfer of Sustainable Building Tax Credit. ● RPD-41329 ● Copies of the letter of eligibility To learn more, visit https://www.emnrd.nm.gov or call (505) 476-3200. 2015 Sustainable Building Tax Credit (S03) (Repealed December 31, 2024) A credit is available for construction in New Mexico of a sustainable building, for renovation of an existing building in New Mexico into a sustainable building, or for permanent installation of manufactured housing that is a sustainable building, regardless of where the housing is manufactured. You may claim the credit for tax years from January 1, 2017 through December 31, 2024. The credit is available for residential and commercial buildings after the construction, installation, or renovation of the sustainable building is complete. To qualify for the tax credit, the building must have achieved a silver or higher certification level in the Leadership in Energy and Environmental Design (LEED) green building rating system or the Build Green NM rating system.

CIT-CR Instructions - 13 - www.tax.newmexico.gov Carry Forward for Seven Years This credit is not refundable, but you can carry the credit forward for seven years from the first eligible tax year after the Department approved the credit. To apply for this credit, follow these steps:

  1. Contact EMNRD to certify eligibility.
  2. After you receive the certificate of eligibility from EMNRD, complete RPD-41382, 2015 Sustainable Building Tax

Credit Approval.

  1. Submit RPD-41382 and a copy of the certificate of eligibility to the Department.

When you receive approval from the Department, follow these steps to claim the credit:

  1. Complete RPD-41383, 2015 Sustainable Building Tax Credit

Claim Form. ● Column A. Enter S03. ● Column B. Enter the credit number assigned by the Department on RPD-41382, 2015 Sustainable Building Tax Credit Approval. If the credit was transferred to you, enter the new credit number assigned on Form RPD-41384, Notice of Transfer of 2015 Sustainable Building Tax Credit. ● RPD-41383 ● A copy of the letter of eligibility To learn more, visit https://www.emnrd.nm.gov or call (505) 476-3200. 2021 Sustainable Building Tax Credit (S05) A credit is available for the construction in New Mexico of a sustainable building, the renovation of an existing building in New Mexico, the permanent installation of manufactured housing, regardless of where the housing is manufactured, that is a sustainable building or the installation of energyconserving products to existing buildings in New Mexico. You may claim the credit for tax years prior to January 1, 2030. If the certification level for a sustainable residential building is awarded on or after January 1, 2021, EMNRD may issue a certificate of eligibility to a building owner who is: • the owner of the sustainable residential building at the time the certification level for the building is awarded, or • the subsequent purchaser of a sustainable residential building with respect to which no tax credit has been previously claimed. The credit is available to the building owner of residential and commercial buildings, after the construction, installation, or renovation of the sustainable building is complete. To be eligible, the building owner must obtain a Certificate of Eligibility issued by the Energy, Minerals and Natural Resources Department (EMNRD). To claim the credit, the taxpayer must submit TRD required forms and Certificate of Eligibility with the taxpayer's income tax return. Carry Forward for Seven Years This credit is non-refundable, but if the sum of all 2021 Sustainable Building Tax Credits that can be claimed in a tax year for a taxpayer exceeds the taxpayer's income tax liability for that tax year, the excess may be carried forward for a period of up to seven years. To apply for this credit, follow these steps:

  1. Contact EMNRD to certify eligibility.
  2. After EMNRD approves the credit they will issue the taxpayer a Certificate of Eligibility.

Follow these steps to claim the credit:

  1. Complete TRD-41252, 2021 Sustainable Building Tax Credit

Claim Form. ● Column A. Enter S05. ● Column B. Enter the credit number assigned by the Department on Certificate of Eligibility. If the credit was transferred to you, enter the new credit number assigned on Form TRD-41253, 2021 Sustainable Building Tax Credit Notice of Transfer. To learn more, visit https://www.emnrd.nm.gov/ecmd/ or call (505) 476-3200. Technology Jobs and Research and Development Tax Credit (additional) (T02) This credit is 5% of qualified expenditures for conducting research and development. An additional 5% credit is available if the taxpayer increases its annual payroll by at least $75,000 for every $1 million in qualified expenditures it claims in a tax year. The basic and additional credits double for businesses in rural areas. IMPORTANT: Taxpayers who claim the research and development small business tax credit are ineligible to claim the investment tax credit or the technology jobs and research

CIT-CR Instructions - 14 - www.tax.newmexico.gov and development tax credit for the same reporting period. Expenditure Eligibility Requirements The following are the eligibility requirements for this tax credit: ● Make qualified expenditures on or after January 1, 2016. ● Make eligible expenditures for research and development at a qualified facility. NOTE: For information on qualified expenditures, see the instructions for RPD-41385, Application for Technology Jobs and Research and Development Tax Credit. Basic and Additional Credits The holder of the Technology Jobs and Research and Development Tax Credit letter may apply all or part of basic credits against the holder's combined state compensating, withholding, and gross receipts tax, less any local option gross receipts tax. If you earned additional credits, you may claim that amount against personal, fiduciary, or corporate income taxes. If the taxpayer is a qualified research and development small business, the Department may refund a portion of the additional credit based on the taxpayer's total qualified expenditures made in a tax year. Carry Forward for Three Years The basic credit is not refundable. Any credit not claimed against the taxpayer's income tax or corporate income tax due, or refunded, may be carried forward for three years from date of the original claim. To apply for the basic and additional credit, do the following:

  1. Complete RPD-41385, Application for Technology Jobs and Research and Development Tax Credit.
  2. Send it with the expenditure and payroll increase documentation to the address on RPD-41385.

After you receive approval from the Department, claim the credit by following these steps:

  1. Complete RPD-41386, Technology Jobs and Research and Development Tax Credit Claim Form. ● Column A. Enter T02. ● Column B. Enter the credit approval number the

Department issued to you. The number is identified on the credit approval letter. If the letter does not show a credit approval number, leave this box blank. ● Column D. If you are eligible for a refund, enter the amount to refund. Otherwise, leave blank. ● RPD-41386

Source: official text