HB 14 New Mexico House · 2025 Regular Session

EARNED INCOME TAX CREDIT

HB 14 replaces New Mexico's Working Families Tax Credit with a new Earned Income Tax Credit (EITC) mirroring the federal program. It directly affects low-income New Mexico residents who qualify for the federal EITC but may have been excluded due to identification or age requirements (e.g., 18-24 year olds), allowing them to claim the credit. The bill sets credit percentages based on the number of qualifying children (2.3% to 13.5%) and establishes income limits ($8,000-$15,200 earned income) and phaseout thresholds ($25,000-$35,200 adjusted gross income). It includes automatic inflation adjustments starting in 2026 and ensures refunds are not treated as taxable income.

Bill status vetoed 4 of 5 stages cleared

Introduction

Feb 2025

Committee Review

Mar 2025

House Passage

Mar 2025

Senate Passage

Mar 2025

Vetoed

Apr 2025

Introduced Feb 5, 2025 Vetoed Apr 11, 2025

Maddy AI version diff · 2 comparisons

What changed between versions

TR substitute → Final Version · 8 edits

MODERATE

The bill was substantially restructured to replace the Working Families Tax Credit with a new Earned Income Tax Credit (EITC) modeled after the federal version. Key changes include new eligibility thresholds based on qualifying children, updated credit percentages, and inflation adjustment mechanisms for future years. The bill also adds several new tax credits and modifies existing tax provisions related to health care, liquor taxes, and tribal alcohol harm funds.

Scope change

The bill's scope expanded from primarily repealing the Working Families Tax Credit to enacting a comprehensive Earned Income Tax Credit system with additional provisions for foster parents, health care practitioners, and tribal alcohol harm relief.

ELIGIBILITY

Replaced the Working Families Tax Credit with a new Earned Income Tax Credit featuring specific credit percentages (11.55% to 15.3%) and phaseout thresholds based on number of qualifying children.

Added provisions for married couples filing jointly to receive a $5,000 increase in phaseout amounts.

REQUIREMENT

Established inflation adjustment mechanism for 2026 and subsequent years, requiring credit amounts to be adjusted based on consumer price index changes.

DEFINITION

Created new definitions for 'earned income', 'eligible individual', 'federal earned income tax credit', and 'qualifying child' aligned with federal standards.

SCOPE

Introduced new tax credits for foster parents and guardians, and modified health care practitioner gross receipts tax deductions to include coinsurance paid by patients.

Increased liquor excise tax rates and created a new Tribal Alcohol Harms Alleviation Fund.

Modified the Oil and Gas Emergency School Tax Act to impose additional taxes on certain oil products when prices meet specific thresholds.

TECHNICAL

Added requirements for the Secretary to maintain detailed income bracket tables with $50 increments for credit calculations.

Floor votes · Senate Mar 20, 2025 · House Mar 15, 2025

How they voted

34–1

Passed · 5 other

Total votes 40

Mar 20, 2025

D Democratic24

20 Yea 4

83% Yea

R Republican16

14 Yea 1 Nay 1

87% Yea

Vote distribution

All Yea All Nay Mixed No data

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Amendments

Apr 11, 2025

Vetoed

executive

Mar 22, 2025

Legislature · Passed

Senate report adopted

legislature

Mar 22, 2025

Legislature · Passed

House report adopted

legislature

Mar 20, 2025

Upper · Passed

passed Senate

upper

Mar 20, 2025

Upper · Passed

floor substitute adopted (1 amendment)

upper

Mar 20, 2025

Introduced

Sent to Conference Committee

legislature

Mar 20, 2025

Introduced

this procedure could follow if the House refuses to recede from its amendments

legislature

Mar 18, 2025

Upper · Passed

DO PASS, as amended, committee report adopted

upper

Mar 16, 2025

Introduced

Sent to Senate Tax, Business and Transportation Committee

upper

Mar 15, 2025

Lower · Passed

passed House

lower

Mar 14, 2025

Lower · Passed

DO NOT PASS, replaced with committee substitute

lower

Feb 13, 2025

Lower · Passed

DO PASS committee report adopted

lower

Feb 5, 2025

Introduced

Sent to House Commerce & Economic Development Committee & House Taxation & Revenue Committee

lower

2 primary · 0 co-sponsors