NMSA 1978, § 7-9-91 — 7-9-91

Deduction; compensating tax; contributions of inventory to
certain organizations and governmental agencies.

# A.

Except as provided otherwise in Subsection D of this section, the value of
tangible personal property that is removed from inventory and contributed to
organizations that have been granted exemption from the federal income tax by the
United States commissioner of internal revenue as organizations described in Section
501(c)(3) of the Internal Revenue Code of 1986, as amended, may be deducted in
computing the compensating tax due, provided that the contribution is deductible for
federal income tax purposes by the person from whose inventory the property was
withdrawn or, if the person from whose inventory the property was withdrawn is a pass-
through entity as that term is defined in Section 7-3A-2 NMSA 1978, the contribution is
deductible by the owner or owners of the pass-through entity.

# B.

Except as provided otherwise in Subsection D of this section, the value of
tangible personal property that is removed from inventory and contributed to the United
States or New Mexico or any governmental unit or subdivision, agency, department or
instrumentality thereof may be deducted in computing the compensating tax due.

# C.

Except as provided otherwise in Subsection D of this section, the value of
tangible personal property that is removed from inventory and contributed to an Indian
tribe, nation or pueblo or any governmental subdivision, agency, department or
instrumentality thereof for use on that Indian reservation or pueblo grant may be
deducted in computing the compensating tax due.

# D.

Unless contrary to federal law, the deduction provided by this section does not
apply to:
(1) a contribution of metalliferous mineral ore;
(2) a contribution of tangible personal property that is or will be incorporated
into a metropolitan redevelopment project created under the Metropolitan
Redevelopment Code [Chapter 3, Article 60A NMSA 1978];
(3) a contribution of tangible personal property that will become an ingredient
or component part of a construction project; or
(4) a contribution of tangible personal property utilized or produced in the
performance of a service.

# E.

For purposes of this section:
(1) "inventory" means tangible personal property held for sale or lease in the
ordinary course of business; and
(2) "contributed" or "contribution" means a transfer of ownership without
consideration. Public acknowledgment of the contribution does not constitute
consideration for the purpose of this section.