Section 21. Government Credit Or Procurement Card Purchases

A. Receipts from sales of tangible personal property to an agency of the United States government or the state of New Mexico are deductible from the gross receipts of the seller when paid for by a credit or procurement card issued to the United States government or the state of New Mexico. Through November 29, 1998, credit or procurement cards bearing the legends “U S GOVT TAX EXEMPT’ and “I.M.P.A.C.” are such credit or procurement cards issued to the United States government. On and after November 30, 1998, credit or procurement cards bearing the legends “United States of America” and “Tax Exempt I.D. 140001849” are such credit or procurement cards issued to the United States government. On or after June 30, 2003, credit or procurement cards bearing the legend “state of New Mexico” and the state seal are such credit or procurement cards issued to the state of New Mexico. B. Receipts from credit or procurement card sales of construction materials or services or receipts from credit or procurement card payments of leases of tangible property are not deductible. Receipts from credit or procurement card sales to employees or representatives of the federal government or the state of New Mexico using a credit or procurement card other than a card issued to the United States government or the state of New Mexico are not deductible from gross receipts under Section 7-9-54 NMSA 1978. [10/24/1989, 11/26/1990, 11/15/1996, 3/31/1999; 3.2.212.21 NMAC - Rn & A, 3 NMAC 2.54.21, 5/31/2001; A, 10/15/2003] 3.2.212.22 TANGIBLE PERSONAL PROPERTY IN PROJECTS FINANCED BY INDUSTRIAL REVENUE OR SIMILAR BONDS: A a credit or procurement card other than a card issued to the United States government or the state of New Mexico are not deductible from gross receipts under Section 7-9-54 NMSA 1978. [10/24/1989, 11/26/1990, 11/15/1996, 3/31/1999; 3.2.212.21 NMAC - Rn & A, 3 NMAC 2.54.21, 5/31/2001; A, 10/15/2003] 3.2.212.22 TANGIBLE PERSONAL PROPERTY IN PROJECTS FINANCED BY INDUSTRIAL REVENUE OR SIMILAR BONDS: A. For the purposes of this section, a “bond project” is an arrangement entered into under the authority of the Industrial Revenue Bond Act, the County Industrial Revenue Bond Act or similar act in which a private person agrees: (1) to arrange for the constructing and equipping of a facility for a state or local government by acting as agent for the government in procuring construction services, other services, tangible personal property which becomes an ingredient or component part of a construction project and other tangible personal property necessary for constructing and equipping the facility; (2) to lease the completed facility from the government; and (3) to buy the facility upon repayment of the bonds. The government agrees to own the facility, to finance the project in whole or in part through the issuance of bonds, to designate the private person as its agent in procuring the necessary property and services, to lease the facility to the private person and to sell the facility to the private person upon repayment of the bonds. B vernment; and (3) to buy the facility upon repayment of the bonds. The government agrees to own the facility, to finance the project in whole or in part through the issuance of bonds, to designate the private person as its agent in procuring the necessary property and services, to lease the facility to the private person and to sell the facility to the private person upon repayment of the bonds. B. Receipts from the sale of tangible personal property to the private person who is acting as agent for the government with respect to the bond project are deductible under Section 7-9-54 NMSA 1978 if the tangible 3.2.212 NMAC 5 personal property is not construction material excluding tangible personal property whether removable or non- removable, that is or would be classified for depreciation purposes as three-year property, five-year property, seven- year property or 10-year property, including indirect costs related to the asset basis, by Section 168 of the Internal Revenue Code of 1986, as that section may be amended or renumbered. To be deductible, the cost of the bond project tangible personal property must not increase the basis, as determined under the provisions of Section 1011 of the Internal Revenue Code in effect on the date the bond project commences, of the structure or other facility included in the definition of construction. C. A bond project commences when the governing body of the state or local government takes official action to enter into the arrangement, but no earlier than the adoption of an inducement resolution. D. This version of 3.2.212.22 NMAC applies to transactions occurring on or after March 2, 2018.