New Mexico Administrative Code › Title 3 - TAXATION › Chapter 13 - BUSINESS TAX CREDITS › Part 20 - LAND CONSERVATION INCENTIVES TAX CREDIT › Section 3.13.20.8 - GENERAL PROVISIONS

Current through Register Vol. 35, No. 13, July 16, 2024
A. Only an applicant may apply for a land conservation incentives tax credit.
B. A taxpayer shall be listed as an owner on the deed conveying the land or interest in land to be eligible for the land conservation incentives tax credit (see Subsection N of 3.13.20.8 NMAC for use of a land conservation tax credit issued to a pass-through entity).
C. A taxpayer is not eligible for a land conservation incentives tax credit if they are or have been a subsidiary, partner, manager, member, shareholder or beneficiary of a domestic partnership, limited liability company, domestic corporation or pass-through entity that owns or has owned the donated land or interest in land in the five years preceding the date that the applicant conveyed the land or interest in land.
D. Qualified donations include a conveyance, on or after January 1, 2004, in perpetuity for a conservation or preservation purpose of a less-than-fee interest in land that appears to qualify as a charitable contribution under 26 U.S.C. section 170(h) and its implementing regulations or a fee interest in land.
E. Dedications of land for open space for the purpose of fulfilling density requirements to obtain subdivision or building permits do not qualify for the land conservation incentives tax credit.
F. For a donation of a fee interest in land or less-than-fee interest in land the applicant conveys, the total amount of the land conservation incentives tax credit for the donation for which an applicant applies shall not exceed fifty percent of the fair market value of the land or interest in land the applicant donated in perpetuity, regardless of the value of the land or interest in land donated or the number of taxpayers owning an interest in the donated property. An applicant shall only apply for one land conservation incentives tax credit per taxpayer per taxable year.
G. For donations made prior to January 1, 2008, a taxpayer owning an interest in the donated land or interest in land may receive a land conservation incentives tax credit worth the lesser of $100,000 or the taxpayer's proportionate share, as determined by the taxpayer's ownership interest in the donated land or interest in land, of fifty percent of the donated land's or interest in land's fair market value. For donations made on or after January 1, 2008, a taxpayer owning an interest in the donated land or interest in land may receive a land conservation incentives tax credit worth the lesser of $250,000 or the taxpayer's proportionate share, as determined by the taxpayer's ownership interest in the donated land or interest in land, of fifty percent of the donated land or interest in land's fair market value. No matter the number of taxpayers owning the donated land or interest in land, the total land conservation incentives tax credit all taxpayers receive for the donated land or interest in land cannot exceed fifty percent of the donated land's or interest in land's fair market value. Therefore, if the applicant conveyed the donation on or after January 1, 2008, and there are 10 taxpayers owning an equal interest in donated land or interest in land worth $2,000,000, each taxpayer's land conservation incentives tax credit would be limited to $100,000.
H. For donations conveyed prior to January 1, 2008, married individuals who both own a recorded interest in the donated land or interest in land, as opposed to one spouse not being named on the deed but having a community property interest, may each receive a land conservation incentives tax credit worth the lesser of $100,000 or the spouse's proportionate share, as determined by the spouse's ownership interest in the donated land or interest in land, of fifty percent of the donated land's or interest in land's fair market value. For donations made on or after January 1, 2008, married individuals who both own a recorded interest in a donated land or interest in land, as opposed to one spouse not being named on the deed but having a community property interest, may each receive a land conservation incentives tax credit worth the lesser of $250,000 or the spouse's proportionate share, as determined by the spouse's ownership interest in the donated land or interest in land, of fifty percent of the donated land's or interest in land's fair market value.
I. The land conservation incentives tax credit originates in the year the applicant conveys the donation, which shall be determined by the date the deed is recorded with the county clerk where the land or interest in land is located. Pursuant to Section  7-1-26 NMSA 1978, an applicant who files a tax return may amend the tax return and claim the land conservation incentives tax credit for three calendar years after the applicant has paid the tax. An applicant may apply for the land conservation incentives tax credit and then amend the applicant's tax return to the year the applicant conveyed the donation as long as the applicant receives approval of the land conservation incentives tax credit and files the amendment within the three year period provided in Section  7-1-26 NMSA 1978. The applicant may carry over portions of the land conservation incentives tax credit that are unused in prior taxable years for a maximum of 20 consecutive years following the taxable year in which the applicant donated the land or interest in land until fully expended.
J. If the applicant donated a portion of the land or interest in land's value, but received payment for the remaining fair market value of the land or interest in land, the applicant may claim only the land conservation incentives tax credit on that portion of the value the applicant donated.
K. An applicant claiming a tax credit pursuant to the Land Conservation Incentives Act shall not claim a credit pursuant to a similar law for costs related to the same donation.
L. A tax filer may claim the land conservation incentives tax credit against the tax liability the Income Tax Act or the Corporate Income and Franchise Tax Act impose.
M. The amount of the land conservation incentives tax credit a tax filer uses in a taxable year may not exceed the amount of the individual income or corporate income tax otherwise due.
N. A land conservation incentives tax credit a pass-through tax entity claims may be used either by the pass-through tax entity if it is the tax filer on behalf of the pass-through tax entity or by the member, manager, partner, shareholder or beneficiary, as applicable, in proportion to the interest in the pass-through tax entity if the income, deductions and tax liability pass through to the member, manager, partner, shareholder or beneficiary. Either (1) the pass-through tax entity or (2) the member, manager, partner, shareholder or beneficiary, but not both (1) and (2) may claim the land conservation incentives tax credit for the same donation.