New Mexico Administrative Code
Title 3 - TAXATION
Chapter 13 - BUSINESS TAX CREDITS
Part 2 - INVESTMENT TAX CREDIT
Section 3.13.2.14 - CREDIT NOT TRANSFERABLE

(1) Corporation T sets up a manufacturing operation in New Mexico. T subsequently qualifies for $50,000 in investment credit. After applying $13,000 to its own gross receipts, compensating and withholding tax liabilities, T creates a subsidiary corporation, S, to own and operate all of T's New Mexico business, including the manufacturing operation. T may not transfer the $37,000 remaining authorized investment credit to S nor may S apply any of the remaining tax credit to S's gross receipts, compensating and withholding tax liability. T, to the extent T still has gross receipts, compensating and withholding tax obligations, may apply the $37,000 balance against those obligations.

(2) When two or more corporations merge, the resultant corporation is a continuation of any predecessor corporation. When a business organization changes its form, as for example from a sole proprietorship to a corporation or from a corporation to a limited liability company, so that the resultant entity is a successor in business to the predecessor, the resultant entity shall be deemed a continuation of the predecessor for investment credit purposes. In both cases, since there is no transfer, the resultant entity may claim any amount of approved but unclaimed investment credit held by a predecessor.