The Child Day Care Credit may not exceed $1,200 or, for a married taxpayer filing a separate return, $600, where a maximum of $480 per child is allowable.
Married individuals maintaining a household for one or more qualifying dependents, that are filing separate, may each claim only half the credit allowed on a joint return.
To qualify for the credit, all of the following must be true:
- You have a Modified Gross Income of $30,160 or less.
- You were a New Mexico resident.
- You provided over half the cost of maintaining a household for one or more qualifying dependents for the part of the tax year for which the rebate is claimed (either separately or jointly with a spouse).
- You were gainfully employed for that part of the tax year for which you are claiming the credit.
- You did not receive public assistance under the TANF, the New Mexico Works Act or similar program, during that part of the tax year for which you are claiming the credit.
- You were not reimbursed or compensated for the amount of child day care expense for which you are claiming the credit.
- If you have reimbursed or compensated child day care expenses, like those paid with pre-tax dollars under cafeteria and similar benefit plans, they are are ineligible.
Note: The Department will verify whether or not you are receiving public assistance.
You cannot claim a credit for amounts paid to a caregiver unless all the following are true for the caregiver:
- If an individual, the caregiver was at least 18 years old when provided the care.
- The caregiver provided the day care service in New Mexico.
- The caregiver provided day care for less than 24 hours daily.
- Your or your spouse could not claim the caregiver as a dependent for federal income tax purposes.
To apply for this credit on your New Mexico return, follow the steps below:
- State Section
- Child Day Care Credit
For additional information pertaining to the Child Day Care Credit, please see Form PIT-RC.