New Mexico legislation · 2026 Regular Session
New Mexico HB264: VARIOUS INCOME TAX DEDUCTIONS
Status: In committee, February 2, 2026
What the bill says
An act relating to taxation; providing an income tax deduction for income from tips, income from overtime and social security income deductible pursuant to federal law; repealing the working families tax credit and enacting the earned income tax credit; creating the foster parent and guardian income tax credit; amending and expanding an income tax deduction for unreimbursed or uncompensated medical care expenses to taxpayers of all income levels; extending a gross receipts tax deduction for health care practitioners and amending the deduction to include coinsurance paid by a patient.
From the introduced text, January 30, 2026:
AN ACT RELATING TO TAXATION; PROVIDING AN INCOME TAX DEDUCTION FOR INCOME FROM TIPS, INCOME FROM OVERTIME AND SOCIAL SECURITY INCOME DEDUCTIBLE PURSUANT TO FEDERAL LAW; REPEALING THE WORKING FAMILIES TAX CREDIT AND ENACTING THE EARNED INCOME TAX CREDIT; CREATING THE FOSTER PARENT AND GUARDIAN INCOME TAX CREDIT; AMENDING AND EXPANDING AN INCOME TAX DEDUCTION FOR UNREIMBURSED OR UNCOMPENSATED MEDICAL CARE EXPENSES TO TAXPAYERS OF ALL INCOME LEVELS; EXTENDING A GROSS RECEIPTS TAX DEDUCTION FOR HEALTH CARE PRACTITIONERS AND AMENDING THE DEDUCTION TO INCLUDE COINSURANCE PAID BY A PATIENT. 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] DEDUCTION--INCOME FROM QUALIFIED TIPS.-- .232992.4 wen = lairetam derocsrednu eteled = ]lairetam detekcarb[ A. A taxpayer may claim a deduction from net income in an amount equal to the amount of qualified tips for which the taxpayer is eligible to deduct pursuant to 26 U.S.C. 224, as that section may be amended or renumbered. B. A taxpayer allowed a deduction pursuant to this section shall report the amount of the deduction to the department in a manner required by the department. C. The deduction provided by this section shall be included in the tax expenditure budget pursuant to Section 7-1-84 NMSA 1978, including …
Sponsors
- Mark Duncan (R, HD-002) · primary sponsor