(The Center Square) – A new child tax credit that is worth up to $600 per qualifying child will save 292,000 New Mexico families about $180 million in taxes according to the New Mexico Department of Taxation. The credit declines in value for wealthier families.
“We know child tax credits reduce childhood poverty, so this is another critical step to lift up New Mexico families,” Governor Michelle Lujan Grisham.
New Mexico made the tax credit refundable, so people will get the full benefit, even if it exceeds their tax liability.
“We’re very excited about this new credit, which will provide more financial stability for thousands of New Mexico families,” Taxation and Revenue Secretary Stephanie Schardin Clarke said.
People must file returns by paper by April 15, while electronic filers have until April 30 for state income taxes in New Mexico.
“Filing electronically minimizes delays in processing and results in faster refunds,” a release said. “Filing early lessens the chances of being affected by a fraudulent return being filed in your name.”
Rebates issued by the Taxation and Revenue Department in 2023 need not be reported on New Mexico income tax returns. However, they “may have federal income tax implications for taxpayers who itemize on their federal returns rather than claiming the standard federal deduction,” according to a release.
Additionally, the state encourages low- and moderate-income residents to better understand which tax credits they can use. Specifically, it wants them to see if they qualify for the Working Families Tax Credit and the Low-Income Comprehensive Tax Rebate, among others.
“Even New Mexicans who aren’t required to file an income tax return because they are below the IRS income threshold may find it beneficial to file a state return,” the agency said.
The state cites refundable tax credits and rebates like the Property Tax Rebate (for low-income seniors) and the Medical Care Credit as examples of why residents who don’t owe the state income tax may still want to file a return.
