Bill > SB206

This bill establishes a "frontier community investment income tax credit" for individuals and a similar credit for corporations, both designed to encourage investment in economically disadvantaged areas. To qualify, a business must be based in New Mexico, have created at least three new full-time jobs, and have had no more than $5 million in gross revenue in the fiscal year before the investment. An investment is considered "qualified" if it's a cash investment made before January 1, 2026, for equity in such a business, and the investor or their affiliates don't receive compensation for services to the business within a year of the investment. Taxpayers can claim a credit of up to 25% of their qualified investment, with a maximum credit of $25,000 per investment, and a total annual cap of $750,000 for all credits issued by the economic development department, which must certify eligibility. The credit aims to boost local economies by creating jobs and providing essential services in these "frontier communities," which are areas designated by the economic development department based on their economic and rural characteristics.