Hoping to Boost State’s Tech Sectors, New Mexico Gov Signs Incentive Package

Last week, New Mexico Gov. Susana Martinez signed House Bill 2 into law, new tax incentive legislation that, according to the governor, expands the state’s economic development toolkit. The bill received bipartisan support, in the GOP-controlled House, where it passed 60-2, and the majority-Democrat Senate, where it was approved 31-11. According to the Martinez administration, the package is expected to cost between $6.5 million and $11.5 million per year. The bill expands six incentives already established, while two new tax breaks are created. Most notable for New Mexico’s TBED community are the New Mexico Angel Tax Credit and the Technology Jobs and Research and Development Tax Credit Act.

The expanded New Mexico Angel Tax Credit makes $2 million in total tax credits per year available to all investors (up from $750,000), while increasing the total amount each individual investor can make to $62,500 per year (up from $25,000). The update also increases the number of credits individual investors can claim to five per year (from two) and the time the credit can be carried forward to five years (from three).

The legislation also combines two existing tax credits, the Technology Jobs Tax Credit and the Small Business Research and Development Tax Credit, to create the Technology Jobs and Research and Development Tax Credit. In addition to removing restrictions that qualified research expenditures be at least 20 percent of total expenditures, the new credit also broadens the definition of a small business to a maximum of 50 employees, up from 25.

Read the governor’s press release here: http://www.governor.state.nm.us/uploads/PressRelease/191a415014634aa89604e0b4790e4768/Governor_Susana_Martinez_Signs_Bipartisan_Jobs_Package.pdf

Read the legislation here: http://www.nmlegis.gov/Sessions/15%20Special/final/HB0002.pdf