us-nm/stat
NMSA 1978, § 7-2-40 — Deduction; income from leasing a liquor license
A.
Prior to January 1, 2026, a taxpayer who is a liquor license lessor and who held
the license on June 30, 2021 may claim a deduction from net income in an amount
equal to the gross receipts from sales of alcoholic beverages made by each liquor
license lessee in an amount, if the liquor license is a dispenser's license and sales of
alcoholic beverages for consumption off premises are less than fifty percent of total
alcoholic beverage sales, not to exceed fifty thousand dollars ($50,000) for each of four
taxable years.
B.
Married individuals filing separate returns for a taxable year for which they could
have filed a joint return may each claim only one-half of a deduction provided by this
section that would have been claimed on a joint return.
C.
A taxpayer may claim the deduction provided by this section 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 deduction. The
total deduction claimed in the aggregate by all members of the partnership or
association with respect to the deduction shall not exceed the amount of the deduction
that could have been claimed by a sole owner of the business.
D.
A taxpayer allowed a deduction pursuant to this section shall report the amount
of the deduction to the department in a manner required by the department.
E.
The deduction provided by this section shall be included in the tax expenditure
budget pursuant to Section 7-1-84 NMSA 1978, including the annual aggregate cost of
the deduction.
F.
As used in this section:
(1) "alcoholic beverage" means alcoholic beverage as defined in the Liquor
Control Act [Chapter 60, Articles 3A, 5A, 6A, 6B, 6C, 6E, 7A, 7B and 8A NMSA 1978];
(2) "dispenser's license" means a license issued pursuant to the provisions of
the Liquor Control Act allowing the licensee to sell, offer for sale or have in the person's
possession with the intent to sell alcoholic beverages both by the drink for consumption
on the licensed premises and in unbroken packages, including growlers, for
consumption and not for resale off the licensed premises;
(3) "growler" means a clean, refillable, resealable container that has a liquid
capacity that does not exceed one gallon and that is intended and used for the sale of
beer, wine or cider;
(4) "liquor license" means a dispenser's license issued pursuant to Section
60-6A-3 NMSA 1978 or a dispenser's license issued pursuant to Section 60-6A-12
NMSA 1978 issued prior to July 1, 2021;
(5) "liquor license lessee" means a person that leases a liquor license from a
liquor license lessor; and
(6) "liquor license lessor" means a person that leases a liquor license to a
third party.
Source: official text