SANTA FE, N.M. (KRQE) – What you could call a “summer of rebates” will continue for hundreds of thousands of New Mexicans as early as next week. The state is preparing to send out another round of $250 or $500 checks to residents who filed their 2021 taxes.
However, unlike the first of two rounds of economic relief payments sent to most New Mexicans in May and June, the latest anticipated July rebates have some strings attached. Specifically, the upcoming rebates have an income threshold, meaning those who made over a certain amount of money in the 2021 calendar year won’t be eligible.
So how can you find out if you’ll get one of these new July rebate checks? Here’s a breakdown of what you need to know.
Who’s eligible?
The latest tax rebate checks are eligible for New Mexican residents who filed their 2021 state taxes. As mentioned, there’s an income threshold tied to these rebates, which is different for both single filers and joint filers.
For New Mexicans who filed their 2021 state taxes as an individual, a rebate will be granted if the person made less than $75,000 in adjusted gross income during the 2021 calendar year. Single filers who meet that qualification will receive a $250 payment from the state.
For residents who filed their 2021 New Mexico state taxes jointly, a rebate will be granted if the couple made less than $150,000 in adjusted gross income last year. Jointed filed who stay under that income threshold will receive a $500 payment from the state.
You can check your 2021 adjusted gross income by looking at your tax filing or “tax return” paperwork (form 1040, 1040-SR, or 1040NR.) It should be on the first page, box 11.
When will the payouts start rolling out?
The rebates should begin processing during “the first full week of July,” or next week, July 3 through July 9, according to the New Mexico Tax and Revenue Department spokesman Charlie Moore. With Monday, July 4, being a holiday for state government, the first rebates could be processed as early as Tuesday, July 5.
Moore says it will likely take the full month for all the rebates to get out to eligible taxpayers. So, some people may not receive a payment for several weeks, like the most recent economic relief payments of May and June.
How will I get a rebate?
As for how the payouts will reach you, the state will pay July rebates automatically, via direct deposit or a paper check. Checks will be sent to those who don’t have direct deposit banking information on file with the state.
“That includes taxpayers who paid tax due by Automated Clearing House (ACH), because [the state] can’t use that [ACH] information to deposit into accounts,” Moore said. Moore also warns that checks are a much slower process than direct deposit.
“We can only print about 14,000 checks per day, so it will take the full month to have those mailed out,” Moore said. “We ask people to be patient and not to call asking about their rebate until we’ve had the full month [of July] to get them distributed.”
The state expects to print as many as 210,000 paper checks. So, in printing 14,000 checks per day, the process is expected to take several weeks to complete.
By comparison, the state says it expects to distribute about 500,000 payments via direct deposit. That process should only take a few days.
Of the anticipated 710,000 rebates that will be granted, Moore says the split between single filers and joint filers is about 50-50. Slightly more than half of the rebates will go to single filing taxpayers.
How is this tax rebate different from the recent economic relief payments?
While similar in value, the July tax rebates are distinctly different from the economic relief payments most New Mexicans will receive in 2022. The July tax rebates are the product of a bill lawmakers passed during the regular legislative session in February.
House Bill 163 spawned the income-based, July tax rebates. According to a Fiscal Impact Report published by legislative staff earlier this year, the Tax and Revenue Department assessed the one-time rebate as a possible “aid in the state’s short run recovery from the pandemic by increasing consumption.”
Shortly after the end of the regular session, Governor Michelle Lujan Grisham called lawmakers back to the Roundhouse for a special session. Out of that one-day session, lawmakers passed House Bill 2.
The special session’s House Bill 2 funded economic relief payments amid record oil revenues and rising costs of living, including high gas prices. Notably, those relief payments do not have an income limit attached to them, and are being paid out in two separate dispersals.
Now in late June, New Mexicans have already received a portion of those economic relief payments. The first economic relief payment went out in May and June, granting $250 dollars to single tax filers and $500 to joint tax filers.
The second economic relief payment is expected in August. Similarly, that payment will grant $250 dollars to single tax filers and $500 to joint tax filers.
Lastly, the economic relief payments also had a mechanism to get money to those who don’t file taxes. That application process has since closed.
Before you call, wondering where your rebate is…
Amid the initial economic relief payments in May and June, the state received thousands of phone calls from people complaining they hadn’t received their payments. Turns out, most of those calls of concern were unwarranted.
“In the vast majority of cases, the rebate is simply still being processed,” Moore said.
Hoping to quell a similar situation that could come with the rollout of the July rebates, the state is asking taxpayers to be patient if they don’t immediately receive a rebate.
“Again, we are asking people to be patient and wait until the end of July before calling to ask about a rebate,” Moore said. “Our call center has been overwhelmed by the volume, even though we have pulled in staffers from throughout the Department to help answer calls.”
However, the state says there are a few common issues to be aware of:
- Some checks may be less than $250 or $500. That can happen if taxpayers incorrectly calculated their income tax payment and still owe money, or because they filed late and have been assessed interest.
- You may not receive a rebate if you were declared as a dependent on someone else’s return.
- You could have received your 2021 tax refund by direct deposit, but did not get their rebate that way. That can happen if taxpayers have changed their banking information since filing, or if their bank rejected the deposit for some reason. Those people will be issued a check mailed to the most recent address we have on file.
A direct deposit may also be delayed if a taxpayer used a preparation service and received an advance from the preparer on their refund, according to TRD. In those cases, the rebates initially go to an account set up as part of the advance process and must be forwarded by the preparation service to the taxpayer.
Other questions?
We might have missed your question or situation here in this article. If you’re looking for more information, the state has an exhaustive frequently asked questions post hosted on its tax.newmexico.gov website.