NM HB221

Removes the $30,000 cap on the state income tax exemption for armed forces retirement pay, allowing military retirees to exempt their entire retirement pay from New Mexico income tax

Extends eligibility to both armed forces retirees and surviving spouses of armed forces retirees

Defines "armed forces retiree" as a former U.S. military member who qualified by years of service or disability to separate with lifetime benefits

Applies to taxable years beginning on or after January 1, 2026