New Mexico 2023 Regular Session Status: Enacted

HB 342 — EDUCATION SAVINGS PLAN USES

Last action — Law Without Signature

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  1. ✓
    Introduced
  2. ✓
    In Committee
  3. ✓
    Passed House
  4. ✓
    Passed Senate
  5. ✓
    To Executive
  6. 6
    Enacted

This bill has been enacted into law. Introduced February 07, 2023. Enacted.

Signed by Governor Michelle Lujan Grisham (Democratic) on March 18, 2023.

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Advancing 52% · moderate confidence

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High

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  • Enacted

    Current position in the legislative process.

  • 2 sponsors

    2 primary, 0 co-sponsors signed on.

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Bill Text

What changed in the latest version

541 added · 889 removed

Plain-language change summary

The recent amendments to House Bill 342 clarify how education savings plans under the Education Trust Act can be used, ensuring they align with federal regulations. This change is important because it helps families use their savings for a wider range of educational expenses that are recognized at the federal level, making it easier for them to take advantage of these funds. In simpler terms, this amendment allows for more flexibility in how families can spend their education savings.

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HOUSE BILL 342 56TH LEGISLATURE - STATEOFNEWMEXICO- FIRST SESSION, 2023 INTRODUCED BY T.
AN ACT RELATING TO EDUCATION;
Ryan Lane and Peter Wirth This document may incorporate amendments proposed by a committee, but not yet adopted, as well as amendments that have been adopted during the current legislative session.
ALIGNING THE USES OF EDUCATION SAVINGS PLANS PROVIDED FOR IN THE EDUCATION TRUST ACT TO COMPLY WITH FEDERALLY ALLOWABLE USES OF THE SAVINGS.
The document is a tool to show amendments in context and cannot be used for the purpose of adding amendments to legislation.
6 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
h AN ACT g o RELATING TO EDUCATION;
SECTION 1.
ALIGNING THE USES OF EDUCATION SAVINGS t hr g e i k PLANS PROVIDED FOR IN THE EDUCATION TRUST ACT TO COMPLY WITH h r i s FEDERALLY ALLOWABLE USES OF THE SAVINGS.
Section 7-2-2 NMSA 1978 (being Laws 1986, Chapter 20, Section 26, as amended) is amended to read:
h , t, e u g e b l e e h BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
"7-2-2.
n d d i = = o h Hfl1º SECTION 1.
DEFINITIONS.--For the purpose of the Income Tax Act and unless the context requires otherwise:
Section 7-2-2 NMSA 1978 (being Laws l ] b ,d i a º e 1986, Chapter 20, Section 26, as amended) is amended to read:
r i = r t e w d m a n o "7-2-2.
DEFINITIONS.--For the purpose of the Income Tax d m :
b e d s º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e e a n e d r e l u [ A d Act and unless the context requires otherwise:
(2) means, for taxpayers other than estates or trusts, that part of the taxpayer's income defined as adjusted gross income plus, for taxable years beginning on or after January 1, 1991, the amount of the net operating loss deduction h u allowed by Section 172(a) of the Internal Revenue Code, as that » r t h section may be amended or renumbered, and taken by the taxpayer g e l i h r for that year;
(2) means, for taxpayers other than estates or trusts, that part of the taxpayer's income defined as HB 342/a Page 1 adjusted gross income plus, for taxable years beginning on or after January 1, 1991, the amount of the net operating loss deduction allowed by Section 172(a) of the Internal Revenue Code, as that section may be amended or renumbered, and taken by the taxpayer for that year;
i s h , (3) includes, for all taxpayers, any other e h t u g income of the taxpayer not included in adjusted gross income e b l e e , gh n d d i but upon which a federal tax is calculated pursuant to the = = o h l ] b ,d Internal Revenue Code for income tax purposes, except amounts i a º r e r = for which a calculation of tax is made pursuant to Section 55 t e w d m a n o d m :
(3) includes, for all taxpayers, any other income of the taxpayer not included in adjusted gross income but upon which a federal tax is calculated pursuant to the Internal Revenue Code for income tax purposes, except amounts for which a calculation of tax is made pursuant to Section 55 of the Internal Revenue Code, as that section may be amended or renumbered;
b r e t º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 2 - e a n e d r e l u [ A d of the Internal Revenue Code, as that section may be amended or renumbered;
1) to pay for federally allowable qualified higher education expenses, [as defined pursuant to] set out in Section 529 of the Internal Revenue Code, including other expenses allowed pursuant to that section as qualified expenses;
1) to pay for federally allowable qualified higher education expenses, set out in Section 529 of the Internal Revenue Code, including other expenses allowed pursuant to that section as qualified expenses;
or 2) upon the beneficiary's death, disability or receipt of a scholarship;
or 2) HB 342/a Page 2 upon the beneficiary's death, disability or receipt of a scholarship;
and h u (5) excludes, for a taxpayer who conducts a » r t h lawful business pursuant to the laws of the state, an amount g e l i h r equal to any expenditure that is eligible to be claimed as a i s h , federal income tax deduction but is disallowed by Section 280E e h t u g of the Internal Revenue Code, as that section may be amended or e b l e e , gh n d d i renumbered;
and (5) excludes, for a taxpayer who conducts a lawful business pursuant to the laws of the state, an amount equal to any expenditure that is eligible to be claimed as a federal income tax deduction but is disallowed by Section 280E of the Internal Revenue Code, as that section may be amended or renumbered;
= = o h l ] b ,d C.
C.
"compensation" means wages, salaries, i a º r e r = commissions and any other form of remuneration paid to t e w d m a n o d m :
"compensation" means wages, salaries, commissions and any other form of remuneration paid to employees for personal services;
b r e t º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 3 - e a n e d r e l u [ A d employees for personal services;
H.
HB 342/a Page 3 H.
h g I.
I.
"individual" means a natural person, an estate, o t hr g e a trust or a fiduciary acting for a natural person, trust or i k h r estate;
"individual" means a natural person, an estate, a trust or a fiduciary acting for a natural person, trust or estate;
i s h J.
J.
"Internal Revenue Code" means the United States , t, e u g e b l Internal Revenue Code of 1986, as amended;
"Internal Revenue Code" means the United States Internal Revenue Code of 1986, as amended;
e e h n d d i K.
K.
"lump-sum amount" means, for the purpose of = = o h l ] b ,d determining liability for federal income tax, an amount that i a º e r i = r t e w d was not included in adjusted gross income but upon which the m a n o d m :
"lump-sum amount" means, for the purpose of determining liability for federal income tax, an amount that was not included in adjusted gross income but upon which the five-year-averaging or the ten-year-averaging method of tax computation provided in Section 402 of the Internal Revenue Code, as that section may be amended or renumbered, was applied;
b e d s º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 4 - e a n e d r e l u [ A d five-year-averaging or the ten-year-averaging method of tax computation provided in Section 402 of the Internal Revenue Code, as that section may be amended or renumbered, was applied;
(8) alimony and separate maintenance payments;
(8) alimony and separate maintenance HB 342/a Page 4 payments;
(10) income from life insurance and endowment h g contracts;
(10) income from life insurance and endowment contracts;
o t hr g e (11) pensions;
(11) pensions;
i k h r (12) discharge of indebtedness;
(12) discharge of indebtedness;
i s h (13) distributive share of partnership income;
(13) distributive share of partnership income;
, t, e u g e b l (14) income in respect of a decedent;
(14) income in respect of a decedent;
e e h n d d i (15) income from an interest in an estate or a = = o h l ] b ,d trust;
(15) income from an interest in an estate or a trust;
i a º e r i = r t e w d (16) social security benefits;
(16) social security benefits;
m a n o d m :
(17) unemployment compensation benefits;
b e d s º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 5 - e a n e d r e l u [ A d (17) unemployment compensation benefits;
(3) payments pursuant to a federal, state or local government program directly or indirectly to a third party on behalf of the taxpayer when identified to a particular use or invoice by the payer;
(3) payments pursuant to a federal, state or HB 342/a Page 5 local government program directly or indirectly to a third party on behalf of the taxpayer when identified to a particular use or invoice by the payer;
or (4) payments for credits and rebates pursuant h g to the Income Tax Act and made for a credit pursuant to Section o t hr g e 7-3-9 NMSA 1978;
or (4) payments for credits and rebates pursuant to the Income Tax Act and made for a credit pursuant to Section 7-3-9 NMSA 1978;
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i k h r N.
N.
"net income" means, for estates and trusts, base i s h income adjusted to exclude amounts that the state is prohibited , t, e u g e b l from taxing because of the laws or constitution of this state e e h n d d i or the United States and means, for taxpayers other than = = o h l ] b ,d estates or trusts, base income adjusted to exclude:
"net income" means, for estates and trusts, base income adjusted to exclude amounts that the state is prohibited from taxing because of the laws or constitution of this state or the United States and means, for taxpayers other than estates or trusts, base income adjusted to exclude:
i a º e r i = r t e w d (1) an amount equal to the standard deduction m a n o d m :
(1) an amount equal to the standard deduction allowed the taxpayer for the taxpayer's taxable year by Section 63 of the Internal Revenue Code, as that section may be amended or renumbered;
b e d s º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 6 - e a n e d r e l u [ A d allowed the taxpayer for the taxpayer's taxable year by Section of the Internal Revenue Code, as that section may be amended or renumbered;
(3) an amount equal to the product of the exemption amount allowed for the taxpayer's taxable year by Section 151 of the Internal Revenue Code, as that section may be amended or renumbered, multiplied by the number of personal exemptions allowed for federal income tax purposes;
(3) an amount equal to the product of the exemption amount allowed for the taxpayer's taxable year by HB 342/a Page 6 Section 151 of the Internal Revenue Code, as that section may be amended or renumbered, multiplied by the number of personal exemptions allowed for federal income tax purposes;
h u (5) other amounts that the state is prohibited » r t h from taxing because of the laws or constitution of this state g e l i h r or the United States;
(5) other amounts that the state is prohibited from taxing because of the laws or constitution of this state or the United States;
i s h , (6) for taxable years that began prior to e h t u g January 1, 1991, an amount equal to the sum of:
(6) for taxable years that began prior to January 1, 1991, an amount equal to the sum of:
e b l e e , gh n d d i (a) net operating loss carryback = = o h l ] b ,d deductions to that year from taxable years beginning prior to i a º r e r = January 1, 1991 claimed and allowed, as provided by the t e w d m a n o d m :
(a) net operating loss carryback deductions to that year from taxable years beginning prior to January 1, 1991 claimed and allowed, as provided by the Internal Revenue Code;
b r e t º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 7 - e a n e d r e l u [ A d Internal Revenue Code;
(a) in the case of a timely filed return, in the taxable year immediately following the taxable year for which the return is filed;
(a) in the case of a timely filed return, in the taxable year immediately following the taxable HB 342/a Page 7 year for which the return is filed;
and h u (c) in either case, if the net operating » r t h loss carryover exceeds the amount of net income exclusive of g e l i h r the net operating loss carryover for the taxable year to which i s h , the exclusion first applies, in the next four succeeding e h t u g taxable years in turn until the net operating loss carryover is e b l e e , gh n d d i exhausted for any net operating loss carryover from a taxable = = o h l ] b ,d year prior to January 1, 2013;
and (c) in either case, if the net operating loss carryover exceeds the amount of net income exclusive of the net operating loss carryover for the taxable year to which the exclusion first applies, in the next four succeeding taxable years in turn until the net operating loss carryover is exhausted for any net operating loss carryover from a taxable year prior to January 1, 2013;
in no event shall a net i a º r e r = operating loss carryover from a taxable year beginning prior to t e w d m a n o d m :
in no event shall a net operating loss carryover from a taxable year beginning prior to January 1, 2013 be excluded in any taxable year after the fourth taxable year beginning after the taxable year to which the exclusion first applies;
b r e t º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 8 - e a n e d r e l u [ A d January 1, 2013 be excluded in any taxable year after the fourth taxable year beginning after the taxable year to which the exclusion first applies;
or (b) in the case of amended returns or original returns not timely filed, in the first taxable year beginning after the date on which the return or amended return establishing the net operating loss is filed;
or (b) in the case of amended returns or HB 342/a Page 8 original returns not timely filed, in the first taxable year beginning after the date on which the return or amended return establishing the net operating loss is filed;
and (c) in either case, if the net operating loss carryover exceeds the amount of net income exclusive of h u the net operating loss carryover for the taxable year to which » r t h the exclusion first applies, in the next nineteen succeeding g e l i h r taxable years in turn until the net operating loss carryover is i s h , exhausted for any net operating loss carryover from a taxable e h t u g year beginning on or after January 1, 2013;
and (c) in either case, if the net operating loss carryover exceeds the amount of net income exclusive of the net operating loss carryover for the taxable year to which the exclusion first applies, in the next nineteen succeeding taxable years in turn until the net operating loss carryover is exhausted for any net operating loss carryover from a taxable year beginning on or after January 1, 2013;
in no event shall a e b l e e , gh n d d i net operating loss carryover from a taxable year beginning:
in no event shall a net operating loss carryover from a taxable year beginning:
1) = = o h l ] b ,d prior to January 1, 2013 be excluded in any taxable year after i a º r e r = the fourth taxable year beginning after the taxable year to t e w d m a n o d m :
1) prior to January 1, 2013 be excluded in any taxable year after the fourth taxable year beginning after the taxable year to which the exclusion first applies;
b r e t º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 9 - e a n e d r e l u [ A d which the exclusion first applies;
"net operating loss" means any net operating loss, as defined by Section 172(c) of the Internal Revenue Code, as that section may be amended or renumbered, for a taxable year as further increased by the income, if any, from obligations of the United States for that year less related expenses;
"net operating loss" means any net operating HB 342/a Page 9 loss, as defined by Section 172(c) of the Internal Revenue Code, as that section may be amended or renumbered, for a taxable year as further increased by the income, if any, from obligations of the United States for that year less related expenses;
"net operating loss carryover" means the amount, h u or any portion of the amount, of a net operating loss for any » r t h taxable year that, pursuant to Paragraph (6), (7) or (8) of g e l i h r Subsection N of this section, may be excluded from base income;
"net operating loss carryover" means the amount, or any portion of the amount, of a net operating loss for any taxable year that, pursuant to Paragraph (6), (7) or (8) of Subsection N of this section, may be excluded from base income;
i s h , Q.
Q.
"nonresident" means every individual not a e h t u g resident of this state;
"nonresident" means every individual not a resident of this state;
e b l e e , gh n d d i R.
R.
"person" means any individual, estate, trust, = = o h l ] b ,d receiver, cooperative association, club, corporation, company, i a º r e r = firm, partnership, limited liability company, joint venture, t e w d m a n o d m :
"person" means any individual, estate, trust, receiver, cooperative association, club, corporation, company, firm, partnership, limited liability company, joint venture, syndicate or other association;
b r e t º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 10 - e a n e d r e l u [ A d syndicate or other association;
but any individual, other than someone who was physically present in the state for one hundred eighty-five days or more during the taxable year, who, on or before the last day of the taxable year, changed the individual's place of abode to a place without this state with the bona fide intention of continuing actually to abide permanently without this state is not a resident for the purposes of the Income Tax Act for periods after that change of abode;
but any individual, other than someone who was physically present in the state for one hundred eighty-five days or more during HB 342/a Page 10 the taxable year, who, on or before the last day of the taxable year, changed the individual's place of abode to a place without this state with the bona fide intention of continuing actually to abide permanently without this state is not a resident for the purposes of the Income Tax Act for periods after that change of abode;
"secretary" means the secretary of taxation and h u revenue or the secretary's delegate;
"secretary" means the secretary of taxation and revenue or the secretary's delegate;
» r t h U.
U.
"state" means any state of the United States, g e l i h r the District of Columbia, the commonwealth of Puerto Rico, any i s h , territory or possession of the United States or any political e h t u g subdivision of a foreign country;
"state" means any state of the United States, the District of Columbia, the commonwealth of Puerto Rico, any territory or possession of the United States or any political subdivision of a foreign country;
e b l e e , gh n d d i V.
V.
"state or local bond" means a bond issued by a = = o h l ] b ,d state other than New Mexico or by a local government other than i a º r e r = one of New Mexico's political subdivisions, the interest from t e w d m a n o d m :
"state or local bond" means a bond issued by a state other than New Mexico or by a local government other than one of New Mexico's political subdivisions, the interest from which is excluded from income for federal income tax purposes under Section 103 of the Internal Revenue Code, as that section may be amended or renumbered;
b r e t º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 11 - e a n e d r e l u [ A d which is excluded from income for federal income tax purposes under Section 103 of the Internal Revenue Code, as that section may be amended or renumbered;
"taxable income" means net income less any lump- sum amount;
"taxable income" means net income less any lump-sum amount;
"taxable year" means the calendar year or fiscal year upon the basis of which the net income is computed under the Income Tax Act and includes, in the case of the return made for a fractional part of a year under the provisions of the Income Tax Act, the period for which the return is made;
"taxable year" means the calendar year or fiscal year upon the basis of which the net income is computed under the Income Tax Act and includes, in the case HB 342/a Page 11 of the return made for a fractional part of a year under the provisions of the Income Tax Act, the period for which the return is made;
"taxpayer" means any individual subject to the tax imposed by the Income Tax Act."»Hfl1 SECTION Hfl1º1.»Hfl1 Hfl1º2.»Hfl1 Section 7-2-32 NMSA (being Laws 1997, Chapter 259, Section 8) is amended to read:
"taxpayer" means any individual subject to the tax imposed by the Income Tax Act." SECTION 2.
h u "7-2-32.
Section 7-2-32 NMSA 1978 (being Laws 1997, Chapter 259, Section 8) is amended to read:
DEDUCTION--PAYMENTS INTO EDUCATION TRUST FUND.-- » r t h A taxpayer may claim a deduction from net income in an amount g e l i h r equal to the payments made by the taxpayer into the education i s h , trust fund pursuant to [a college] an education investment e h t u g agreement or prepaid tuition contract under the Education Trust e b l e e , gh n d d i Act in the taxable year for which the deduction is being = = o h l ] b ,d claimed.
"7-2-32.
The amount of payments made on behalf of any one i a º r e r = beneficiary that may be deducted shall not exceed in the t e w d m a n o d m :
DEDUCTION--PAYMENTS INTO EDUCATION TRUST FUND.--A taxpayer may claim a deduction from net income in an amount equal to the payments made by the taxpayer into the education trust fund pursuant to an education investment agreement or prepaid tuition contract under the Education Trust Act in the taxable year for which the deduction is being claimed.
b r e t º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 12 - e a n e d r e l u [ A d aggregate the cost of attendance at the applicable institution of higher education, as determined by the education trust board.
The amount of payments made on behalf of any one beneficiary that may be deducted shall not exceed in the aggregate the cost of attendance at the applicable institution of higher education, as determined by the education trust board.
[A husband and wife ] Married individuals who file separate returns for the taxable year in which they could have filed a joint return may each claim only one-half of the deduction that would have been allowed on the joint return.
Married individuals who file separate returns for the taxable year in which they could have filed a joint return may each claim only one-half of the deduction that would have been allowed on the joint return.
Individuals having income both within and without this state shall apportion this deduction in accordance with regulations of the secretary." SECTION Hfl1º 2.»Hfl1 Hfl1º3.»Hfl1 Section 21-21K-2 NMSA (being Laws 2014, Chapter 76, Section 2) is amended to read:
Individuals having income both within and without this state shall apportion this deduction in accordance with regulations of the secretary." SECTION 3.
Section 21-21K-2 NMSA 1978 (being Laws 2014, HB 342/a Page 12 Chapter 76, Section 2) is amended to read:
"account" means an individual trust account pursuant to [a college ] an education investment agreement entered into pursuant to the [college ] education savings h g program;
"account" means an individual trust account pursuant to an education investment agreement entered into pursuant to the education savings program;
o t hr B.
B.
"account owner" means the person who has entered g e i k into [a college ] an education investment agreement with the h r i s h board and is designated as having the right to withdraw money , t, e u g from the account before the account is disbursed to or for the e b l e e h benefit of the beneficiary;
"account owner" means the person who has entered into an education investment agreement with the board and is designated as having the right to withdraw money from the account before the account is disbursed to or for the benefit of the beneficiary;
n d d i = = o h C.
C.
"beneficiary" means the person who is designated l ] b ,d i a º e r i = r at the time the account is opened, or the person who replaces a t e w d m a n o designated beneficiary, as the person whose qualified higher d m :
"beneficiary" means the person who is designated at the time the account is opened, or the person who replaces a designated beneficiary, as the person whose qualified higher education expenses are expected to be paid from the account;
b e d s º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 13 - e a n e d r e l u [ A d education expenses are expected to be paid from the account;
"[college] education investment agreement" means an agreement entered into by the board and an account owner to participate in the [college ] education savings program and establish an account to be used for the qualified higher education expenses of a beneficiary [at an eligible institution of higher education];
"education investment agreement" means an agreement entered into by the board and an account owner to participate in the education savings program and establish an account to be used for the qualified higher education expenses of a beneficiary;
"eligible educational institution" means any college, university, vocational school or other post-secondary institution recognized by the United States department of education;
"eligible educational institution" means any HB 342/a Page 13 college, university, vocational school or other post-secondary institution recognized by the United States department of education;
[G.] H.
H.
"financial institution" means a bank, broker-dealer, insurance company, mutual fund, savings and loan h association or other financial entity;
"financial institution" means a bank, broker- dealer, insurance company, mutual fund, savings and loan association or other financial entity;
g o t hr [H.
I.
"institution of higher education" means a post- g e i k secondary educational institution eligible to participate in h r i s student financial aid programs administered by the United h , t, States department of education;] e u g e b l e e h I.
"Internal Revenue Code" means the federal Internal Revenue Code of 1986, as amended;
"Internal Revenue Code" means the federal n d d i = = o h Internal Revenue Code of 1986, as amended;
J.
[and ] l ] b ,d i a º e J.
"manager" means a financial institution under contract with the board to serve as manager of an education savings plan in the education savings program and receive contributions on behalf of the program;
"manager" means a financial institution under r i = r t e w d m a n o contract with the board to serve as manager of [a college ] an d m :
b e d s º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 14 - e a n e d r e l u [ A d education savings plan in the [college] education savings program and receive contributions on behalf of the program;
"qualified higher education expenses" means federally allowable qualified expenses set out in the Internal Revenue Code Section 529 and includes other expenses allowed under that section as qualified education expenses." SECTION Hfl1º 3.»Hfl1 Hfl1º4.»Hfl1 Section 21-21K-3 NMSA (being Laws 2014, Chapter 76, Section 3) is amended to read:
"qualified higher education expenses" means federally allowable qualified expenses set out in the Internal Revenue Code Section 529 and includes other expenses allowed under that section as qualified education expenses." SECTION 4.
Section 21-21K-3 NMSA 1978 (being Laws 2014, Chapter 76, Section 3) is amended to read:
[COLLEGE ] EDUCATION SAVINGS PROGRAM CREATED-- EDUCATION TRUST FUND CREATED--PURPOSE--INVESTMENT OF ACCOUNTS BY THIRD PARTIES--BOARD REVIEW--PROGRAM ADMINISTRATION FUND CREATED--PURPOSE.-- A.
EDUCATION SAVINGS PROGRAM CREATED--EDUCATION TRUST FUND CREATED--PURPOSE--INVESTMENT OF ACCOUNTS BY THIRD PARTIES--BOARD REVIEW--PROGRAM ADMINISTRATION FUND CREATED-- PURPOSE.-- A.
The "[college] education savings program" is created to allow interested persons to enter into [college ] education investment agreements with the board as a means to h save money to pay a beneficiary's eligible expenses for [a g o t hr college] an education.
The "education savings program" is created to allow interested persons to enter into education investment agreements with the board as a means to save money to pay a HB 342/a Page 14 beneficiary's eligible expenses for an education.
The [college] education savings program g e i k may consist of one or more [college ] education savings plans.
The education savings program may consist of one or more education savings plans.
h r i s The board shall administer the [college ] education savings h , t, program through accounts established in the education trust e u g e b l e e h fund pursuant to [college ] education investment agreements.
The board shall administer the education savings program through accounts established in the education trust fund pursuant to education investment agreements.
n d d i = = o h Money in an account may be used by the beneficiary [at any l ] b ,d i a º e eligible institution of higher education in New Mexico or any r i = r t e w d m a n o other state] for qualified higher education expenses.
Money in an account may be used by the beneficiary for qualified higher education expenses.
d m :
B.
b e d s º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 15 - e a n e d r e l u [ A d B.
The board shall develop and administer the education savings program in a manner that allows account owners and beneficiaries to obtain and maintain federal income tax benefits or treatment provided by the Internal Revenue Code for qualified tuition programs and exemptions under the federal securities laws.
The board shall develop and administer the [college] education savings program in a manner that allows account owners and beneficiaries to obtain and maintain federal income tax benefits or treatment provided by the Internal Revenue Code for qualified [state ] tuition programs and exemptions under the federal securities laws.
The fund shall be administered by the board to carry out the [college ] education savings program.
The fund shall be administered by the board to carry out the education savings program.
h E.
E.
Amounts may be withdrawn or transferred from g o t hr trust accounts in the education trust fund only as provided in g e i k the related [college ] education investment agreements.
Amounts may be withdrawn or transferred from trust accounts in the education trust fund only as provided HB 342/a Page 15 in the related education investment agreements.
All h r i s money contributed to accounts established in the fund are held h , t, in trust by the board and the respective managers for the sole e u g e b l e e h benefit of the respective account owners and beneficiaries.
All money contributed to accounts established in the fund are held in trust by the board and the respective managers for the sole benefit of the respective account owners and beneficiaries.
n d d i = = o h F.
F.
The "program administration fund" is created as l ] b ,d i a º e a nonreverting fund in the state treasury.
The "program administration fund" is created as a nonreverting fund in the state treasury.
The fund consists r i = r t e w d m a n o of all administrative and other fees received by the board d m :
The fund consists of all administrative and other fees received by the board pursuant to education investment agreements and contracts with managers and any other money credited to the fund.
b e d s º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 16 - e a n e d r e l u [ A d pursuant to [college] education investment agreements and contracts with managers and any other money credited to the fund.
Money in the fund may be used to pay costs of establishing, marketing and otherwise administering the [college ] education savings program in accordance with the Education Trust Act.
Money in the fund may be used to pay costs of establishing, marketing and otherwise administering the education savings program in accordance with the Education Trust Act.
Disbursements from the fund shall be by warrants of the secretary of finance and administration on vouchers signed by the director of the board or the director's authorized representative." SECTION Hfl1º 4.»Hfl1 Hfl1º5.»Hfl1 Section 21-21K-4.1 NMSA 1978 (being Laws 2014, Chapter 76, Section 5) is amended to read:
Disbursements from the fund shall be by warrants of the secretary of finance and administration on vouchers signed by the director of the board or the director's authorized representative." SECTION 5.
Section 21-21K-4.1 NMSA 1978 (being Laws 2014, Chapter 76, Section 5) is amended to read:
(1) adopt, amend or repeal and promulgate h rules necessary to carry out the provisions of the Education g o t hr Trust Act;
(1) adopt, amend or repeal and promulgate rules necessary to carry out the provisions of the Education Trust Act;
g e i k (2) sue and be sued;
(2) sue and be sued;
h r i s (3) enter into contracts;
HB 342/a Page 16 (3) enter into contracts;
h , t, (4) employ or contract for professional, e u g e b l e e h technical and clerical staff and independent counsel;
(4) employ or contract for professional, technical and clerical staff and independent counsel;
n d d i = = o h (5) contract with one or more financial l ] b ,d i a º e institutions to manage the education trust fund and the r i = r t e w d m a n o separate trust accounts;
(5) contract with one or more financial institutions to manage the education trust fund and the separate trust accounts;
d m :
(6) enter into education investment agreements with interested persons to participate in the education savings program;
b e d s º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 17 - e a n e d r e l u [ A d (6) enter into [college] education investment agreements with interested persons to participate in the [college] education savings program;
(7) charge, impose and collect administrative fees as provided in an education investment agreement or other contract relating to the education savings program in amounts not exceeding the reasonable costs of establishing, marketing and otherwise administering the program;
(7) charge, impose and collect administrative fees as provided in [a college ] an education investment agreement or other contract relating to the [college ] education savings program in amounts not exceeding the reasonable costs of establishing, marketing and otherwise administering the program;
The board shall adopt and promulgate education trust fund investment guidelines and otherwise administer the [college] education savings program in compliance with the Uniform Prudent Investor Act." h SECTION Hfl1º 5.»Hfl1 Hfl1º6.»Hfl1 Section 21-21K-5 NMSA g o t hr 1978 (being Laws 2014, Chapter 76, Section 6) is amended to g e i k read:
The board shall adopt and promulgate education trust fund investment guidelines and otherwise administer the education savings program in compliance with the Uniform Prudent Investor Act." SECTION 6.
h r i s "21-21K-5.
Section 21-21K-5 NMSA 1978 (being Laws 2014, Chapter 76, Section 6) is amended to read:
[COLLEGE ] EDUCATION INVESTMENT AGREEMENTS-- h , t, ACCOUNTS.-- e u g e b l e e h A.
"21-21K-5.
An account owner may enter into [a college ] an n d d i = = o h education investment agreement with the board under which an l ] b ,d i a º e account in the education trust fund is established and r i = r t e w d m a n o contributions may be made to the account from time to time, d m :
EDUCATION INVESTMENT AGREEMENTS--ACCOUNTS.-- HB 342/a Page 17 A.
b e d s º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 18 - e a n e d r e l u [ A d consistent with the terms of the agreement, to defray the cost of [eligible ] qualified higher education expenses [at institutions of higher education].
An account owner may enter into an education investment agreement with the board under which an account in the education trust fund is established and contributions may be made to the account from time to time, consistent with the terms of the agreement, to defray the cost of qualified higher education expenses.
An account owner may enter into [a college] an education investment agreement on behalf of any beneficiary.
An account owner may enter into an education investment agreement on behalf of any beneficiary.
Gifts and bequests by persons other than the account owner may be made to an account in the education trust fund for the benefit of the beneficiary in accordance with the terms of the [college ] education investment agreement.
Gifts and bequests by persons other than the account owner may be made to an account in the education trust fund for the benefit of the beneficiary in accordance with the terms of the education investment agreement.
The board shall set forth procedures relating to the withdrawal of money from an account established in the education trust fund pursuant to [a college ] an education investment agreement.
The board shall set forth procedures relating to the withdrawal of money from an account established in the education trust fund pursuant to an education investment agreement.
[A college] An education investment agreement h may be terminated by the account owner at any time.
An education investment agreement may be terminated by the account owner at any time.
The board g o t hr shall specify by rule appropriate provisions for the term and g e i k termination of [college ] education investment agreements.
The board shall specify by rule appropriate provisions for the term and termination of education investment agreements.
h r i s E.
E.
Contributions made to an account in the h , t, education trust fund, together with accrued investment earnings e u g e b l e e h and capital appreciation in such account, shall be excluded n d d i = = o h from any calculation of the respective beneficiary's student l ] b ,d i a º e financial aid eligibility in New Mexico.
Contributions made to an account in the education trust fund, together with accrued investment earnings and capital appreciation in such account, shall be excluded from any calculation of the respective beneficiary's HB 342/a Page 18 student financial aid eligibility in New Mexico.
r i = r t e w d m a n o F.
F.
The board shall notify each account owner d m :
The board shall notify each account owner annually about the status of the account owner's account in the education trust fund." SECTION 7.
b e d s º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 19 - e a n e d r e l u [ A d annually about the status of the account owner's account in the education trust fund." SECTION Hfl1º 6.»Hfl1 Hfl1º7.»Hfl1 Section 21-21K-6 NMSA (being Laws 2014, Chapter 76, Section 7) is amended to read:
Section 21-21K-6 NMSA 1978 (being Laws 2014, Chapter 76, Section 7) is amended to read:
A member of the board, while h acting within the scope of the member's authority or while g o t hr acting as a trustee of the education trust fund or any separate g e i k trust fund or account of the board, shall not be subject to any h r i s personal liability for any action taken or omitted within that h , t, scope of authority.
A member of the board, while acting within the scope of the member's authority or while acting as a trustee of the education trust fund or any separate trust fund or account of the board, shall not be subject to any personal liability for any action taken or omitted within that scope of authority.
e u g e b l e e h C.
C.
In no event shall any liability of or n d d i = = o h contractual obligation incurred by the [college ] education l ] b ,d i a º e savings program obligate or encumber any of the state's funds r i = r t e w d m a n o or treasury, including but not limited to the state's general d m :
In no event shall any liability of or contractual obligation incurred by the education savings program obligate or encumber any of the state's funds or HB 342/a Page 19 treasury, including but not limited to the state's general fund, land grant permanent funds, the severance tax permanent fund or any other permanent fund or any money that is a part of a state-funded financial aid program.
b e d s º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e - 20 - e a n e d r e l u [ A d fund, land grant permanent funds, the severance tax permanent fund or any other permanent fund or any money that is a part of a state-funded financial aid program.
Nothing in the Education Trust Act creates any obligation, legal, moral or otherwise, to fulfill the terms of any education investment agreement or any other obligation or liability out of any source other than the education trust fund or the program administration fund." HB 342/a Page 20 25
Nothing in the Education Trust Act creates any obligation, legal, moral or otherwise, to fulfill the terms of any [college ] education investment agreement or any other obligation or liability out of any source other than the education trust fund or the program administration fund." - 21 - » g o » r h t i k l i g t h s , e h t l i w l b l e e , gh n d l h = = b , a l º d i a r e r = , a t e d m a n o d m :
b r e t º o t n = .224158.3AIC March 3, 2023 (12:46pm) s k m e e a n e d r e l u [ A d
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Action History

  1. Law Without Signature

  2. passed Senate

  3. DO PASS committee report adopted

  4. Sent to Senate Education Committee

  5. passed House

  6. floor substitute adopted (1 amendment)

  7. DO PASS committee report adopted

  8. DO PASS committee report adopted

  9. Sent to House Education Committee & House Government, Elections and Indian Affairs Committee

Sponsors

  • Peter Wirth · Primary
  • T. Ryan Lane · Primary

Sponsorship breakdown

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2 sponsors · 0 co-sponsors · 110 not signed on

Sponsors (2)

  • Wirth, Peter
  • Lane, T. Ryan

Co-sponsors (0)

None.

Not signed on (110)

110 members have not signed on to this bill.

Show all 110 →

"Not signed on" means a member has not sponsored or co-sponsored this bill — it does not imply opposition. Members flagged Voted No have a recorded No vote on this bill.

Whip count is in markup. Polling the chamber and every recorded vote this session. Only the first open is slow. It’s instant for you after this. Calling the roll · Tallying · Engrossing

Subjects

finance education
Cross-referencing the record. Reading this bill against every other bill in the corpus by meaning, not keywords. Only the first open is slow. It’s instant for you after this. Matching · Ranking · Engrossing

Frequently asked questions

Who sponsors HB 342?
HB 342 is sponsored by Wirth, Peter and Lane, T. Ryan.
What is the current status of HB 342?
This bill has been enacted into law. Introduced February 07, 2023. Enacted.
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