us-nm/stat
NMSA 1978, § 7-9G-1 — High-wage jobs tax credit; qualifying high-wage jobs
A.
A taxpayer that is an eligible employer may apply for, and the department may
allow, a tax credit for each new high-wage job. The credit provided in this section may
be referred to as the "high-wage jobs tax credit".
B.
The purpose of the high-wage jobs tax credit is to provide an incentive for
businesses to create and fill new high-wage jobs in New Mexico.
C.
The high-wage jobs tax credit may be claimed and allowed in an amount equal to
eight and one-half percent of the wages distributed to an eligible employee in a new
high-wage job but shall not exceed twelve thousand seven hundred fifty dollars
($12,750) per job per qualifying period. The high-wage jobs tax credit may be claimed
by an eligible employer for each new high-wage job performed for the year in which the
new high-wage job is created and for consecutive qualifying periods.
D.
To receive a high-wage jobs tax credit, a taxpayer shall file a completed
application for approval of the credit with the department once per calendar year on
forms and in the manner prescribed by the department. The annual application shall
contain the certification required by Subsection K of this section and shall contain all
qualifying periods that closed during the calendar year for which the application is
made. Any qualifying period that did not close in the calendar year for which the
application is made shall be denied by the department. The application for a calendar
year shall be filed no later than December 31 of the following calendar year. If a
taxpayer fails to file the annual application within the time limits provided in this section,
the application shall be denied by the department.
E.
A new high-wage job shall not be eligible for a credit pursuant to this section for
the initial qualifying period unless the eligible employer's total number of employees with
threshold jobs on the last day of the initial qualifying period at the location at which the
job is performed or based is at least one more than the number of threshold jobs on the
day prior to the date the new high-wage job was created. A new high-wage job shall not
be eligible for a credit pursuant to this section for a consecutive qualifying period unless
the total number of threshold jobs at a location at which the job is performed or based
on the last day of that qualifying period is greater than or equal to the number of
threshold jobs at that same location on the last day of the initial qualifying period for the
new high-wage job.
F.
If a consecutive qualifying period for a new high-wage job does not meet the
wage, occupancy and residency requirements, then the qualifying period is ineligible.
G.
Except as provided in Subsection H of this section, a new high-wage job shall not
be eligible for a credit pursuant to this section if:
(1) the new high-wage job is created due to a business merger or acquisition
or other change in business organization;
(2) the eligible employee was terminated from employment in New Mexico by
another employer involved in the business merger or acquisition or other change in
business organization with the taxpayer; and
(3) the new high-wage job is performed by:
(a) the person who performed the job or its functional equivalent prior to the
business merger or acquisition or other change in business organization; or
(b) a person replacing the person who performed the job or its functional
equivalent prior to a business merger or acquisition or other change in business
organization.
H.
A new high-wage job that was created by another employer and for which an
application for the high-wage jobs tax credit was received and is under review by the
department prior to the time of the business merger or acquisition or other change in
business organization shall remain eligible for the high-wage jobs tax credit for the
balance of the consecutive qualifying periods. The new employer that results from a
business merger or acquisition or other change in business organization may only claim
the high-wage jobs tax credit for the balance of the consecutive qualifying periods for
which the new high-wage job is otherwise eligible.
I.
A new high-wage job shall not be eligible for a credit pursuant to this section if
the job is created due to an eligible employer entering into a contract or becoming a
subcontractor to a contract with a governmental entity that replaces one or more entities
performing functionally equivalent services for the governmental entity unless the job is
a new high-wage job that was not being performed by an employee of the replaced
entity.
J.
A new high-wage job shall not be eligible for a credit pursuant to this section if
the eligible employer has more than one business location in New Mexico from which it
conducts business and the requirements of Subsection E of this section are satisfied
solely by moving the job from one business location of the eligible employer in New
Mexico to another business location of the eligible employer in New Mexico.
K.
With respect to each annual application for a high-wage jobs tax credit, the
employer shall certify and include:
(1) the amount of wages paid to each eligible employee in a new high-wage
job during the qualifying period;
(2) the number of weeks each position was occupied during the qualifying
period;
(3) whether the new high-wage job was in a municipality with a population of
sixty thousand or more or with a population of less than sixty thousand according to the
most recent federal decennial census and whether the job was in the unincorporated
area of a county;
(4) which qualifying period the application pertains to for each eligible
employee;
(5) the total number of employees employed by the employer at the job
location on the day prior to the qualifying period and on the last day of the qualifying
period;
(6) the total number of threshold jobs performed or based at the eligible
employer's location on the day prior to the qualifying period and on the last day of the
qualifying period;
(7) for an eligible employer that has more than one business location in New
Mexico from which it conducts business, the total number of threshold jobs performed or
based at each business location of the eligible employer in New Mexico on the day prior
to the qualifying period and on the last day of the qualifying period;
(8) whether the eligible employer is receiving or is eligible to receive
development training program assistance pursuant to Section 21-19-7 NMSA 1978;
(9) whether the eligible employer has ceased business operations at any of its
business locations in New Mexico; and
(10) whether the application is precluded by Subsection O of this section.
L.
Any person who willfully submits a false, incorrect or fraudulent certification
required pursuant to Subsection K of this section shall be subject to all applicable
penalties under the Tax Administration Act [Chapter 7, Article 1 NMSA 1978], except
that the amount on which the penalty is based shall be the total amount of credit
requested on the application for approval.
M.
Except as provided in Subsection N of this section, an approved high-wage jobs
tax credit shall be claimed against the taxpayer's modified combined tax liability and
shall be filed with the return due immediately following the date of the credit approval. If
the credit exceeds the taxpayer's modified combined tax liability, the excess shall be
refunded to the taxpayer.
N.
If the taxpayer ceases business operations in New Mexico while an application
for credit approval is pending or after an application for credit has been approved for
any qualifying period for a new high-wage job, the department shall not grant an
additional high-wage jobs tax credit to that taxpayer except as provided in Subsection O
of this section and shall extinguish any amount of credit approved for that taxpayer that
has not already been claimed against the taxpayer's modified combined tax liability.
O.
A taxpayer that has received a high-wage jobs tax credit shall not submit a new
application for the credit for a minimum of two calendar years from the closing date of
the last qualifying period for which the taxpayer received the credit if the taxpayer lost
eligibility to claim the credit from a previous application pursuant to Subsection N of this
section.
P.
The economic development department and the taxation and revenue
department shall report to the appropriate interim legislative committee each year the
cost of the high-wage jobs tax credit to the state and its impact on company recruitment
and job creation.
Q.
As used in this section:
(1) "benefits" means all remuneration for work performed that is provided to
an employee in whole or in part by the employer, other than wages, including the
employer's contributions to insurance programs, health care, medical, dental and vision
plans, life insurance, employer contributions to pensions, such as a 401(k), and
employer-provided services, such as child care, offered by an employer to the
employee;
(2) "consecutive qualifying period" means each of the three qualifying periods
successively following the qualifying period in which the new high-wage job was
created;
(3) "department" means the taxation and revenue department;
(4) "dependent" means "dependent" as defined in 26 U.S.C. 152(a), as that
section may be amended or renumbered;
(5) "domicile" means the sole place where an individual has a true, fixed,
permanent home. It is the place where the individual has a voluntary, fixed habitation of
self and family with the intention of making a permanent home;
(6) "eligible employee" means an individual who is employed in New Mexico
by an eligible employer and who is a resident of New Mexico; "eligible employee" does
not include an individual who:
(a) is a dependent of the employer;
(b) if the employer is an estate or trust, is a grantor, beneficiary or fiduciary of
the estate or trust or is a dependent of a grantor, beneficiary or fiduciary of the estate or
trust;
(c) if the employer is a corporation, is a dependent of an individual who owns,
directly or indirectly, more than fifty percent in value of the outstanding stock of the
corporation; or
(d) if the employer is an entity other than a corporation, estate or trust, is a
dependent of an individual who owns, directly or indirectly, more than fifty percent of the
capital and profits interests in the entity;
(7) "eligible employer" means an employer that, during the applicable
qualifying period, would be eligible for development training program assistance under
the fiscal year 2019 policies defining development training program eligibility developed
by the industrial training board in accordance with Section 21-19-7 NMSA 1978;
(8) "modified combined tax liability" means the total liability for the reporting
period for the gross receipts tax imposed by Section 7-9-4 NMSA 1978 together with
any tax collected at the same time and in the same manner as the gross receipts tax,
such as the compensating tax, the withholding tax, the interstate telecommunications
gross receipts tax, the surcharges imposed by Section 63-9D-5 NMSA 1978 and the
surcharge imposed by Section 63-9F-11 NMSA 1978, minus the amount of any credit
other than the high-wage jobs tax credit applied against any or all of these taxes or
surcharges; but "modified combined tax liability" excludes all amounts collected with
respect to local option gross receipts taxes;
(9) "new high-wage job" means a new job created in New Mexico by an
eligible employer on or after July 1, 2004 and prior to July 1, 2036 that is occupied for at
least forty-four weeks of a qualifying period by an eligible employee who is paid wages
calculated for the qualifying period to be at least:
(a) sixty thousand dollars ($60,000) if the job is performed or based in or
within ten miles of the external boundaries of a municipality with a population of sixty
thousand or more according to the most recent federal decennial census or in a class H
county; and
(b) forty thousand dollars ($40,000) if the job is performed or based in a
municipality with a population of less than sixty thousand according to the most recent
federal decennial census or in the unincorporated area, that is not within ten miles of the
external boundaries of a municipality with a population of sixty thousand or more, of a
county other than a class H county;
(10) "new job" means a job that is occupied by an employee who has not been
employed in New Mexico by the eligible employer in the three years prior to the date of
hire;
(11) "qualifying period" means the period of twelve months beginning on the
day an eligible employee begins working in a new high-wage job or the period of twelve
months beginning on the anniversary of the day an eligible employee began working in
a new high-wage job;
(12) "resident" means a natural person whose domicile is in New Mexico at the
time of hire or within one hundred eighty days of the date of hire;
(13) "threshold job" means a job that:
(a) is occupied for at least forty-four weeks of the first fifty-two weeks of
employment by an eligible employee; provided that the fifty-two-week period begins on
the day the eligible employee occupies the job; and
(b) meets the wage requirements for a "new high-wage job"; and
(14) "wages" means all compensation paid by an eligible employer to an
eligible employee through the employer's payroll system, including those wages that the
employee elects to defer or redirect or the employee's contribution to a 401(k) or
cafeteria plan program, but "wages" does not include benefits or the employer's share of
payroll taxes, social security or medicare contributions, federal or state unemployment
insurance contributions or workers' compensation.
Source: official text