New Mexico’s Social Security Taxes May Be the Next to Be Slashed| New Updates!

After an agreement was reached by the Senate Tax Committee late last week, it is possible that New Mexico will soon be able to stop collecting Social Security benefits for certain seniors.

The state is one of 12 that continues to tax Social Security benefits at varied rates depending on one’s income level.

However, numerous states that continue to charge Social Security are proposing modifications to the system, such as raising the age of taxation, phasing out the fees, or even removing the tax entirely.

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Individuals with salaries up to $100,000 and couples filing jointly with incomes up to $150,000 would be exempt from Social Security taxes under a settlement reached last week in New Mexico, according to the Associated Press.

Senators on the Senate Tax Committee unanimously approved Senate Bill 5 (SB5) by a vote of 9 to 1. The House version, HB163, has elements that are identical to the Senate bill.

However, the state’s existing tax includes all Social Security payments in the taxable income base,

despite the fact that the state provides a discount that reduces the taxability of any type of retirement income.

 Social Security

New Mexico’s Social Security Taxes May Be the Next to Be Slashed

According to Fred Nathan, executive director of Think New Mexico, a nonpartisan research group focused on financial problems such as financial literacy and pensions,

if the bill is implemented, it will result in a reduction of slightly more than $84 million in state revenue each year.

According to the Las Cruces Sun-News,

one of the bill’s co-sponsors, Sen. Michael Padilla of Albuquerque, stated that with 49 percent of New Mexico’s foster children being raised by retired grandparents,

the money that would have been lost to the state’s coffers would be converted to spendable income for the benefit of the entire economy.

Since 1990, the state of New Mexico has levied a levy on Social Security benefits.

If the proposal is approved by the legislature and signed by the governor, it might take effect during the current tax year.

First and foremost, SB5 must be approved by the Senate Finance Committee, which will adjourn at noon on Thursday.

“It’s a tight schedule,” said the office of committee Chair George Munoz, according to ThinkAdvisor.

In an interview with ThinkAdvisor, Nathan said he was “confident” that the Senate and House proposals would pass and be signed by Gov.

Michelle Lujan Grisham, a Democrat who has long advocated for the repeal of the tax.

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