This bill amends Section 7-2-5.13 of the New Mexico Income Tax law to remove the limit on the amount of income tax exemption for uniformed services retirement pay. The current law allows individuals who are uniformed services retirees or their surviving spouses to claim an exemption on the amount of their retirement pay that is includable in net income. The amendment specifies that the exemption applies to the full amount of the retiree's uniformed services retirement pay, rather than a capped amount of $30,000, and updates the terminology from "armed forces" to "uniformed services."

Additionally, the bill provides a definition of "uniformed service," which includes various branches of the military, the United States merchant marine, and certain commissioned corps. It also clarifies the definition of a "uniformed services retiree" as a former member who has qualified for separation with lifetime benefits. The provisions of this act will take effect for taxable years beginning on or after January 1, 2027.

Statutes affected:
introduced version: 7-2-5.13