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HOUSE BILL 568
57TH LEGISLATURE - STATE OF NEW MEXICO - FIRST SESSION, 2025
INTRODUCED BY
Cynthia Borrego and Joseph L. Sanchez
AN ACT
RELATING TO TAXATION; CREATING THE HOME FIRE RECOVERY INCOME
TAX CREDIT.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. A new section of the Income Tax Act is enacted
to read:
"[NEW MATERIAL] HOME FIRE RECOVERY INCOME TAX CREDIT.--
A. A taxpayer who is not a dependent of another
individual and who, beginning on the effective date of this
section and prior to January 1, 2031, incurs qualified site-
built home expenditures for a home in New Mexico to replace a
prior home of the taxpayer that was destroyed by a wildfire in
calendar years 2021 through 2023 may claim a tax credit against
the taxpayer's tax liability imposed pursuant to the Income Tax
Act in an amount equal to the qualified site-built home
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expenditures incurred by the taxpayer. The tax credit provided
by this section may be referred to as the "home fire recovery
income tax credit".
B. A taxpayer who seeks to claim a tax credit
pursuant to this section shall apply for certification of
eligibility for the tax credit from the construction industries
division of the regulation and licensing department on forms
and in a manner prescribed by that division. An application
for certification of the tax credit shall be made no later than
twelve months after the calendar year in which construction of
the site-built home is completed. Except as otherwise provided
in Subsections F and G of this section, only one tax credit
shall be certified per taxpayer. The construction industries
division may promulgate rules governing the procedure for
administering the provisions of this subsection. Completed
applications shall be considered in the order received.
C. An application for certification of eligibility
shall include:
(1) proof that the taxpayer's prior home was
destroyed by wildfire in calendar years 2021 through 2023,
including a sworn statement by the taxpayer;
(2) proof that the taxpayer incurred
expenditures for the construction of a site-built home on the
same property of the taxpayer's prior, wildfire-destroyed home,
including a contract with a builder;
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(3) a sworn statement by the taxpayer and the
builder of the site-built home that the construction of a new
site-built home has been completed and stating the date of its
completion; and
(4) any additional information the
construction industries division of the regulation and
licensing department may require to determine eligibility for
the credit.
D. If the construction industries division of the
regulation and licensing department determines that the
taxpayer meets the requirements of this section, the division
shall issue a dated certificate of eligibility to the taxpayer
providing the amount of home fire recovery income tax credit
for which the taxpayer is eligible and the taxable year in
which the credit may be claimed. The construction industries
division shall provide the department with the certificates of
eligibility issued pursuant to this subsection in an electronic
format at regularly agreed-upon intervals.
E. A taxpayer issued a certificate of eligibility
shall claim the tax credit in a manner required by the
department within twelve months of being issued the certificate
of eligibility.
F. That portion of the tax credit that exceeds a
taxpayer's tax liability in the taxable year in which the tax
credit is claimed shall not be refunded but may be carried
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forward for a maximum of three consecutive taxable years.
G. Married individuals filing separate returns for
a taxable year for which they could have filed a joint return
may each claim only one-half of the tax credit that would have
been claimed on a joint return.
H. A taxpayer may be allocated the right to claim
the tax credit in proportion to the taxpayer's ownership
interest if the taxpayer owns an interest in a business entity
that is taxed for federal income tax purposes as a partnership
or limited liability company and that business entity has met
all of the requirements to be eligible for the credit. The
total credit claimed by all members of the partnership or
limited liability company shall not exceed the allowable credit
pursuant to this section.
I. The department shall compile an annual report on
the tax credit provided by this section that shall include the
number of taxpayers approved by the department to receive the
credit, the aggregate amount of credits approved and any other
information necessary to evaluate the credit. The department
shall present the report to the revenue stabilization and tax
policy committee and the legislative finance committee with an
analysis of the cost of the tax credit.
J. As used in this section:
(1) "home" means a dwelling designed for long-
term habitation in which the taxpayer resides for a majority of
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the year;
(2) "qualified site-built home expenditures"
means gross expenditures for the construction of a site-built
home on the same property in New Mexico that a taxpayer's prior
home was destroyed by a wildfire in calendar years 2021 through
2023, less any compensation related to home construction or
repair costs received pursuant to the federal Hermit's
Peak/Calf Canyon Fire Assistance Act; and
(3) "site-built home" means a home that is
constructed permanently on a taxpayer's property with a
foundation and that cannot be moved, and excludes a
manufactured or mobile home."
SECTION 2. DELAYED REPEAL.--Section 1 of this act is
repealed effective January 1, 2032.
SECTION 3. APPLICABILITY.--The provisions of this act
apply to taxable years beginning on or after January 1, 2025.
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