Instructions Draft For Pit-1 - New Mexico Personal Income Tax Return - 2013 Page 26
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44• The amount of New Mexico income
Worksheet for Computing Tax on Lump-Sum Distributions
tax liability computed on that portion
of income taxed in both states.
PIT-1,
1.
Taxable income from
line 17 ................................1._______________
Complete the worksheet on the
2.
Amount of lump-sum income reported for purposes
of 10-year tax option or capital gains election on
next page and attach a copy of the
federal Form 4972 ...........................................................2._______________
worksheet(s) and
complete income
tax return(s) from the other state(s)
to
3.
MULTIPLY line 2 by 0.20 and enter .................................3._______________
your
PIT-1.
4.
ADD lines 1 and 3 ............................................................4._______________
DRAFT 1.2
Income allocated or apportioned out-
5.
Enter the tax from the tax rate tables on the
side New Mexico on Schedule PIT-B
amount on line 4 ..............................................................5._______________
does not qualify for credit for taxes paid
6.
Enter the tax from the tax rate tables on the
to another state on that same income.
amount on line 1 ..............................................................6._______________
If a Schedule PIT-B is filed, only
7.
SUBTRACT line 6 from line 5 and enter difference .........7._______________
income required to be allocated
10-08-2013
or apportioned to New Mexico and
8.
MULTIPLY the amount on line 7 by 5. (This is the
included in Column 2 on Schedule
additional averaged tax due on the lump-sum income.)
PIT-B will qualify for a credit for tax
Enter on PIT-1, line 19 .....................................................8._______________
paid to another state.
instructions for lines 22 and 23, and
PIT-B to calculate New Mexico tax li-
For example, a New Mexico resident’s
lines 26 through 41. Also see Royalty
ability on line 18 and also used the fed-
interest earned from an investment in
Income of Non-Residents on page 4
eral special tax option and New Mexico
Arizona is allocated to New Mexico on
of these instructions.
averaging methods to calculate tax on
Schedule PIT-B, Column 2. Because
a lump-sum distribution on line 19, DO
the interest income is required to be
LINE 19
NOT add line 19 when completing line
allocated to New Mexico and if it is also
Tax on Lump-Sum Distributions
22 on the PIT-1 as instructed. Instead
taxed in Arizona, the credit for taxes
subtract the sum of lines 20 and 21
paid to another state may be claimed.
If you received a lump-sum payment
from the amount entered on line 18.
and are using the federal special ten-
Skip line 19. You do not need to add
Income that is not required to be al-
year tax option on federal Form 4972,
PIT-1, line 19 when completing PIT-1,
located or apportioned to New Mexico
use the Worksheet for Computing Tax
line 22 because the New Mexico por-
will not qualify for the credit for taxes
on Lump-Sum Distributions above to
tion of line 19 (lump sum distributions)
paid to another state.
compute your New Mexico averaged
is included in PIT-B, line 14.
tax. You are not eligible to use the New
For example, rental income from prop-
Mexico averaging method if you did
LINE 20
erty located outside of New Mexico
not use the federal averaging methods
Credit for Taxes Paid to Another
is allocated outside New Mexico on
available. Enter the amount on line 8 of
State
Schedule PIT-B. Because that income
the worksheet to compute tax on lump-
is not included in Column 2 on Sched-
sum distributions on PIT-1, line 19.
A resident of New Mexico who must
ule PIT-B, credit for tax paid to another
pay tax to another state on income that
state cannot be claimed.
If you file Schedule PIT-B because you
is also taxable in New Mexico may take
have income sources in and outside
a credit against New Mexico tax for tax
Income tax you paid to any municipal-
New Mexico, allocate to New Mexico
paid to the other state.
ity, county, or other political subdivision
on Schedule PIT-B, line 3 the por-
of a state or to any central government
tion of the lump-sum distribution you
This credit is for tax that another
of a foreign country does not count
state imposes on any portion of in-
received while a resident. If you are
toward the credit.
a full-year resident or a resident
come that by law is included in New
because you were physically present
Mexico net income. Do not include
“State” includes the District of Columbia,
in New Mexico for 185 days or more,
tax withheld when calculating the al-
the Commonwealth of Puerto Rico, any
you must allocate to New Mexico the
lowable credit. If the specific item of
territory or possession of the United
income is not subject to taxation in
lump-sum distribution you received
States, and states and provinces of
during the entire year. If you are a first-
both states, no credit is available.
foreign countries. “State” does not
year resident or a part-year resident,
include their central governments.
allocate only the amount of lump-sum
The credit may not be more than:
distribution you received while a resi-
NOTE: Effective for retirement income
• The New Mexico tax liability due on
dent of New Mexico.
received after December 31, 1995,
the return,
federal law prohibits any state from tax-
IMPORTANT: If you used Schedule
• The tax paid to the other state, and
ing certain retirement income (mainly
PIT-1
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