New Mexico Expands Earned Income Tax Credit
Today, New Mexico Governor Lujan Grisham (D) passed legislation to expand the state Earned Income Tax Credit (EITC), also known as the Working Families Tax Credit. The Working Families Tax Credit will increase from 17% to 20% of the federal EITC in 2021 and to 25% of the federal credit in 2023.
In addition to increasing the value of the credit, the legislation expands eligibility to filers with Individual Taxpayer Identification Numbers (ITINs) and filers as young as 18 who are not dependents. New Mexico is now one of seven states to expand the credit to young workers and one of six states to expand eligibility to ITIN filers.
Advocates and lawmakers emphasized that a fairer tax system will directly support New Mexico families and local economies. New Mexico Voices for Children also emphasized how the legislation would make the tax system more equitable for communities of color in the state.
Lead sponsor State Representative Javier Martinez said, “This $100 million per year relief bill implements proven poverty reduction programs that will uplift our low-income communities.”
Expanding the Working Families Tax Credit is not the only step New Mexico has taken to support families with low incomes in 2021. EITC-eligible families and individuals can also claim a $600 tax rebate.
To learn more about other state-level tax credits across the country, visit our 50-state map here.