EARNED INCOME TAX CREDIT (EITC)

Rate (Fully-Refundable): 17% of the federal credit

Eligibility Requirements: All New Mexico taxpayers who qualify for the federal credit are automatically eligible.

Latest Legislative Action: On April 4, 2019, New Mexico Governor Michelle Lujan Grisham signed legislation to increase the state’s Earned Income Tax Credit, known as the Working Families Tax Credit, from 10 to 17 percent of the federal credit as part of a broader tax package.

Notes: After being introduced at 8% in 2007, the Working Families Tax Credit was increased to 10% during a special session of the legislature, which Governor Bill Richardson called for the purpose of providing tax relief to New Mexico families.

CHILD TAX CREDIT (CTC)

New Mexico does not currently offer a state-level CTC.

CHILD AND DEPENDENT CARE TAX CREDIT (CDCTC)

Rate (Fully-Refundable):² 40% of qualifying expenses as defined under the federal CDCTC, not to exceed $480 per child or a total of $1,200 per family. For filers with federal tax liability, the amount of the state credit is reduced by the portion of the federal credit that applies against federal taxes.

Eligibility:³

• Filer’s adjusted gross income must not exceed $30,160
• Filer must have provided over half the cost of maintaining a household for one or more qualifying dependents for any portion of the tax year for which the credit is claimed.
• Filer must not have been a recipient of public assistance under TANF, the New Mexico Works Act, or any similar program during the portion of the tax year for which the credit is claimed.
• Qualifying expenses must be from care given in New Mexico for children under age fifteen, up to $8/day per child.