New Mexico Income Tax Rates & Brackets (Tax Year 2025 — Filed in 2026)
⚠️Informational only — not legal or tax advice.
Tax year covered: 2025 (returns filed in 2026)
Applies to: Income earned January 1 – December 31, 2025
Returns filed: January – April 2026
Last verified: February 22, 2026
Table of Contents
- Quick Reference
- Key Takeaways
- Quick Questions
- New Mexico Income Tax Rates and Brackets (2026 Filing Season)
- Statutory Authority
- Who Must File New Mexico Income Tax
- What Income Is Taxable in New Mexico
- Standard Deduction and Exemptions
- New Mexico Income Tax Credits
- Filing Deadlines
- Filing Options
- Special Considerations for New Mexico Income Tax
- Tax Residency vs Domicile
- Documentation Commonly Requested in Residency Audits
- Military Personnel
- Retirees
- Students
- Part-Year Residents
- Common Tax Filing Situations
- Penalties and Interest
- Forms & Publications
- Information Verification Log
- Where to Check for Updates
- Resources
- Tax Glossary
- Update History
Quick Reference
Does New Mexico have income tax? Yes
Tax structure: Progressive (graduated-rate)
Tax rates: 1.5% to 5.9% (6 brackets — restructured for Tax Year 2025)
Standard deduction (Single): $15,750 (matches federal 2025 standard deduction)
Standard deduction (Married Filing Jointly): $31,500 (matches federal 2025 standard deduction)
Local income tax: No
Official source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Key Takeaways
- Residents: New Mexico residents pay state income tax on income from all sources worldwide
- Non-residents: Non-residents pay New Mexico income tax only on New Mexico-source income
- Tax rates: Progressive structure with 6 brackets, rates from 1.5% to 5.9% — the first major restructuring since 2005, effective Tax Year 2025
- Local income tax: New Mexico does not permit local income taxes; only state-level income tax applies
- Reciprocity: None — New Mexico does not have reciprocal tax agreements with other states
- Primary forms: Form PIT-1 (residents, part-year residents, and nonresidents); Schedule PIT-B (part-year residents and nonresidents)
Quick Questions About New Mexico Income Tax
What is the New Mexico income tax rate for 2025?
New Mexico has a progressive income tax with 6 brackets and rates ranging from 1.5% to 5.9%. Tax Year 2025 introduced a restructured bracket system under HB 252 (Laws 2024, ch. 67), lowering the bottom rate from 1.7% to 1.5% and adding a new 4.3% middle bracket for a smoother progression.
Does New Mexico have state income tax?
Yes. New Mexico levies a personal income tax on residents for all income from any source, and on nonresidents for income from New Mexico sources. The tax is computed starting from federal adjusted gross income (FAGI).
What are the income tax brackets in New Mexico?
For Tax Year 2025, New Mexico has 6 tax brackets with rates of 1.5%, 3.2%, 4.3%, 4.7%, 4.9%, and 5.9%. The applicable bracket thresholds vary by filing status. See the complete bracket tables below.
Is Social Security taxed in New Mexico?
For most New Mexico taxpayers, Social Security benefits are not taxable. The exemption is available to taxpayers whose federal adjusted gross income is under $100,000 (single filers), under $150,000 (married filing jointly, head of household, surviving spouses), or under $75,000 (married filing separately). Taxpayers above these thresholds must include Social Security benefits in New Mexico taxable income.
Does New Mexico tax retirement income?
New Mexico generally taxes retirement distributions from 401(k)s, IRAs, and private pensions. However, taxpayers age 65 and older may deduct up to $8,000 of certain retirement income, subject to income limits. Military retirement pay is fully exempt. Railroad retirement benefits are also deductible.
Do I need to file a New Mexico income tax return?
New Mexico law requires filing Form PIT-1 if you are a resident or received income from New Mexico sources AND you are required to file a federal income tax return. You must also file to claim any New Mexico refund, credit, or rebate, even if not otherwise required.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
New Mexico Income Tax Rates and Brackets (2026 Filing Season)
The following tax rates and brackets apply to income earned in Tax Year 2025, reported on returns filed in 2026. These rates were enacted by HB 252 (Laws 2024, Chapter 67, Section 5), effective January 1, 2025, and represent the first major restructuring of New Mexico’s income tax brackets since 2005.
| Rate Snapshot | |
|---|---|
| Tax Attribute | Amount / Status |
| Lowest Tax Rate | 1.5% |
| Highest Tax Rate | 5.9% |
| Tax Structure | Progressive (6 brackets) |
| Number of Brackets | 6 brackets |
| State Income Tax | Yes |
| Local Income Tax | No |
| Standard Deduction (Single) | $15,750 (matches federal 2025) |
| Standard Deduction (Married Filing Jointly) | $31,500 (matches federal 2025) |
| Personal Exemption | None (federal exemption suspended since 2018) |
| Low-and-Middle-Income Exemption | Up to $2,500 (income-based) |
Source: https://www.nmlegis.gov/Sessions/24%20Regular/bills/house/HB0252.HTML and https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
New Mexico Income Tax Brackets 2026
| Married Filing Jointly / Head of Household / Surviving Spouses | ||
|---|---|---|
| Taxable Income | Tax Rate | Tax Calculation |
| $0 – $8,000 | 1.5% | 1.5% of taxable income |
| $8,001 – $25,000 | 3.2% | $120 + 3.2% of excess over $8,000 |
| $25,001 – $50,000 | 4.3% | $664 + 4.3% of excess over $25,000 |
| $50,001 – $100,000 | 4.7% | $1,739 + 4.7% of excess over $50,000 |
| $100,001 – $315,000 | 4.9% | $4,089 + 4.9% of excess over $100,000 |
| Over $315,000 | 5.9% | $14,624 + 5.9% of excess over $315,000 |
| Single Filers / Estates and Trusts | ||
|---|---|---|
| Taxable Income | Tax Rate | Tax Calculation |
| $0 – $5,500 | 1.5% | 1.5% of taxable income |
| $5,501 – $16,500 | 3.2% | $82.50 + 3.2% of excess over $5,500 |
| $16,501 – $33,500 | 4.3% | $434.50 + 4.3% of excess over $16,500 |
| $33,501 – $66,500 | 4.7% | $1,165.50 + 4.7% of excess over $33,500 |
| $66,501 – $210,000 | 4.9% | $2,716.50 + 4.9% of excess over $66,500 |
| Over $210,000 | 5.9% | $9,748 + 5.9% of excess over $210,000 |
| Married Filing Separately | ||
|---|---|---|
| Taxable Income | Tax Rate | Tax Calculation |
| $0 – $4,000 | 1.5% | 1.5% of taxable income |
| $4,001 – $12,500 | 3.2% | $60 + 3.2% of excess over $4,000 |
| $12,501 – $25,000 | 4.3% | $332 + 4.3% of excess over $12,500 |
| $25,001 – $50,000 | 4.7% | $869.50 + 4.7% of excess over $25,000 |
| $50,001 – $157,500 | 4.9% | $2,044.50 + 4.9% of excess over $50,000 |
| Over $157,500 | 5.9% | $7,312 + 5.9% of excess over $157,500 |
Note: New Mexico does not offer a separate Head of Household bracket. Head of household filers use the same brackets as married filing jointly under the 2025 restructuring (Section 7-2-7 NMSA 1978, as amended by Laws 2024, ch. 67, § 5).
Source: https://www.nmlegis.gov/Sessions/24%20Regular/bills/house/HB0252.HTML (Laws 2024, Chapter 67, effective January 1, 2025)
What Changed for Tax Year 2025?
Prior to Tax Year 2025, New Mexico used a 5-bracket structure with a bottom rate of 1.7%. Effective January 1, 2025, HB 252 restructured the brackets as follows:
- Bottom rate lowered from 1.7% to 1.5%
- New 4.3% bracket added between 3.2% and 4.7%, preventing large tax jumps for middle-income earners
- Bracket thresholds adjusted for all filing statuses
- Rates of 3.2%, 4.7%, 4.9%, and 5.9% retained from prior law
The 2024 restructuring was the first major adjustment to New Mexico’s bracket structure since 2005. All taxpayers are expected to owe slightly less under the new structure.
Source: https://www.nmlegis.gov/Sessions/24%20Regular/bills/house/HB0252.HTML and https://sourcenm.com/2024/03/12/all-new-mexicans-will-pay-less-income-tax-after-first-major-change-in-nearly-20-years/
Statutory Authority
New Mexico personal income tax is authorized under the following legal framework:
Constitutional Authority:
- New Mexico Constitution, Article VIII — establishes the state’s taxing power and framework for legislation
Statutory Authority:
- Section 7-2-1 through 7-2-38, NMSA 1978 — New Mexico Income Tax Act (“Personal Income Tax”)
- Section 7-2-7 NMSA 1978 — Individual income tax rates (as amended by Laws 2024, ch. 67, § 5, effective January 1, 2025)
- Available at: https://laws.justia.com/codes/new-mexico/chapter-7/article-2/
Administrative Regulations:
- New Mexico Administrative Code, Title 3, Chapter 1 — Tax Administration
- Regulations available at: https://www.tax.newmexico.gov/all-nm-taxes/statutes-with-regulations/
Legislative History:
- Original personal income tax structure: Laws 2005, Chapter 104, § 4
- Addition of 5.9% top bracket: Laws 2019, Chapter 270, § 12 (effective Tax Year 2021)
- Current 6-bracket structure: Laws 2024, Chapter 67, § 5 (HB 252, effective January 1, 2025)
This page compiles information directly from these statutory and regulatory authorities as implemented by the New Mexico Taxation and Revenue Department.
Source: https://www.nmlegis.gov/Sessions/24%20Regular/bills/house/HB0252.HTML and https://www.tax.newmexico.gov/all-nm-taxes/statutes-with-regulations/
Who Must File New Mexico Income Tax
General Rule
New Mexico law requires filing Form PIT-1 (New Mexico Personal Income Tax Return) when both of the following conditions are met:
- The taxpayer is a New Mexico resident, or has income from New Mexico sources
- The taxpayer is required to file a federal income tax return
This filing requirement applies equally to residents, part-year residents, and nonresidents.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Residents
A New Mexico resident must file a state income tax return if they are required to file a federal return. For Tax Year 2025, the federal filing thresholds (which New Mexico conforms to) are approximately $15,000 for single filers and $30,000 for married couples filing jointly.
Even if not required to file, a resident must file to claim any New Mexico refund, credit, or rebate.
Part-Year Residents
Part-year residents file Form PIT-1 and attach Schedule PIT-B to allocate income between the period of New Mexico residency and the period of nonresidency. Income earned during New Mexico residency is taxable regardless of source; income earned while a resident of another state is generally excluded.
Non-Residents
Non-residents must file Form PIT-1 with Schedule PIT-B if they have income from New Mexico sources and are required to file a federal return. New Mexico sources include:
- Wages earned while physically working in New Mexico
- Business income derived from New Mexico operations
- Rental income from New Mexico property
- Income from pass-through entities operating in New Mexico
- Capital gains from New Mexico real property
Note on nonresident filing threshold: New Mexico requires nonresidents to file if they receive any New Mexico-source income and are required to file a federal return. Unlike some states, New Mexico does not apply a separate dollar threshold for nonresidents.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Special Groups
- Indian nation, tribe, or pueblo members: Members working or living on lands outside their own Indian nation, tribe, or pueblo are subject to New Mexico income tax. Income earned on tribal lands of which the taxpayer is a member is generally exempt.
- Military members: A New Mexico-domiciled military member who has not changed state of residency must file. Active duty pay is exempt from New Mexico tax. See the Military Personnel section in Part 3.
- Deceased taxpayers: The surviving spouse or personal representative must file on behalf of a deceased taxpayer if that individual would have been required to file.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
What Income Is Taxable in New Mexico
New Mexico personal income tax starts with Federal Adjusted Gross Income (FAGI) from the federal return, then applies New Mexico-specific adjustments, deductions, and exemptions to arrive at New Mexico taxable income.
Fully Taxable Income (General)
The following types of income are included in federal AGI and are generally taxable in New Mexico unless a specific New Mexico deduction or exemption applies:
- Wages and salaries
- Self-employment income
- Business income
- Interest and dividend income
- Capital gains
- Rental income
- Retirement account distributions (401(k), traditional IRA, etc.)
- Gambling winnings
- Alimony (for agreements finalized before January 1, 2019, per federal rules)
|
Social Security Benefits
New Mexico provides a full exemption for Social Security benefits for most taxpayers, based on federal adjusted gross income (FAGI).
|
|
|---|---|
| Filing Status | Full Exemption Available If FAGI Is: |
| Single | Under $100,000 |
| Married Filing Jointly | Under $150,000 |
| Head of Household | Under $150,000 |
| Surviving Spouse | Under $150,000 |
| Married Filing Separately | Under $75,000 |
Taxpayers above these thresholds must include their Social Security benefits in New Mexico taxable income.
Claim the exemption on Schedule PIT-ADJ, New Mexico Schedule of Additions, Deductions, and Exemptions.
Source: https://www.tax.newmexico.gov/wp-content/uploads/2026/01/20260112_New-Mexico-to-begin-accepting-electronic-income-tax-returns-Jan.-16_Final.pdf and https://www.tax.newmexico.gov/wp-content/uploads/2023/04/Tuesday-filing-deadline_SSC.pdf
Military Retirement Pay
New Mexico fully exempts military retirement pay from state income tax. This exemption was enacted in 2022 as part of a broader tax reform package. There is no income cap or age requirement for this exemption.
Claim the exemption on Schedule PIT-ADJ.
Source: https://www.tax.newmexico.gov/wp-content/uploads/2022/07/Tax-laws-take-effect.pdf
Active Duty Military Pay
Active duty pay earned by members of the U.S. armed forces is exempt from New Mexico personal income tax, regardless of where the active duty income is earned.
New Mexico residents on active duty must file Form PIT-1 and use Schedule PIT-ADJ to deduct active duty pay from taxable income.
Railroad Retirement Benefits
Railroad retirement benefits (Tier 1 and Tier 2) are deductible on Schedule PIT-ADJ and are not included in New Mexico taxable income.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Pension and Retirement Income — Age 65 and Older
Taxpayers age 65 or older may deduct up to $8,000 of pension, annuity, or retirement income from New Mexico taxable income. The deduction applies to each qualifying taxpayer (e.g., both spouses may qualify if both are 65 or older). The deduction may be subject to income limits; taxpayers should refer to the PIT-1 instruction booklet for the applicable income threshold for Tax Year 2025.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Centennial Exemption — Age 100 or Older
New Mexico provides a complete income tax exemption for all income earned by residents who are 100 years of age or older. No New Mexico income tax is owed by a qualifying centennial taxpayer.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
529 Education Savings Plans
Contributions to a Section 529 college savings plan account may be deductible. Taxpayers should refer to Schedule PIT-ADJ instructions for applicable limits.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Standard Deduction and Exemptions
| Standard Deduction | |
|---|---|
| Filing Status | Standard Deduction |
| Single | $15,750 |
| Married Filing Jointly | $31,500 |
| Married Filing Separately | $15,750 |
| Head of Household | $23,625 |
Important: If a taxpayer itemized deductions on their federal return and included a state and local tax (SALT) deduction, that SALT amount must be added back to New Mexico income. New Mexico does not allow a deduction for state and local taxes.
Enter the federal standard or itemized deduction amount (from federal Form 1040, line 12) on Form PIT-1, line 12. If itemized, mark the box on line 12a and complete the SALT addback on line 10.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Personal Exemptions
New Mexico does not currently offer a personal exemption. The federal personal exemption has been suspended since Tax Year 2018 under the Tax Cuts and Jobs Act. New Mexico conforms to this federal rule.
Source: https://www.tax.newmexico.gov/wp-content/uploads/sites/6/2020/10/man-2019taxpreparerguide.pdf
Deduction for Certain Dependents
Taxpayers who file as head of household or married filing jointly may claim a deduction of $4,000 for each qualifying dependent, provided the federal personal exemption amount under IRC § 151 is zero (as it has been since 2018). This deduction is claimed on PIT-1, line 13.
Source: https://www.tax.newmexico.gov/wp-content/uploads/sites/6/2020/10/man-2019taxpreparerguide.pdf
Low- and Middle-Income Exemption
New Mexico taxpayers may claim an income-based exemption of up to $2,500 if their federal adjusted gross income does not exceed the applicable threshold for their filing status. This exemption is available to all taxpayers regardless of residency status (residents, part-year residents, and nonresidents may all claim it in full).
The FAGI thresholds and exact exemption amounts are determined by filing status; refer to the PIT-1 instruction booklet for the precise income limits applicable to Tax Year 2025.
Claim on Form PIT-1, line 14.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Medical Care Expense Deduction (Age 65 and Older)
Taxpayers age 65 or older may claim a deduction of up to $3,000 for unreimbursed medical care expenses for themselves, their spouse, or dependents. The expenses must exceed $28,000 and must not be covered by insurance or Medicaid.
Claim on Form PIT-1, line 16, with the unreimbursed amount reported on line 16a.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
New Mexico Income Tax Credits
Refundable Credits (Form PIT-RC)
Refundable credits may reduce tax below zero, resulting in a refund even if no taxes are owed. Claimed on the PIT-RC, Rebate and Credit Schedule.
1. Working Families Tax Credit (WFTC)
New Mexico’s Working Families Tax Credit is a refundable credit tied to eligibility for the federal Earned Income Credit (EIC). For Tax Year 2025, the WFTC equals 25% of the federal EIC amount.
- Available to taxpayers who qualify for the federal EIC
- Expanded eligibility beginning Tax Year 2021: taxpayers who would qualify for the EIC but lack a required identification number, or are between ages 18–25, may still claim the WFTC in New Mexico
- New Mexico does not require the taxpayer to have qualified for the federal EIC; the NM expansion can apply independently
Eligibility: Must meet federal EITC criteria as adapted by New Mexico law
Claimed on: Form PIT-1, line 25
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
2. New Mexico Child Tax Credit
A refundable child tax credit available to New Mexico families, enacted in 2023 and expanded for Tax Year 2023 onward. The credit amount per qualifying child is income-based, with higher credits for lower-income families and up to $600 per qualifying child for eligible taxpayers. The credit amount phases down as income increases.
Claimed on Schedule PIT-ADJ or as directed in the PIT-1 instructions (check current year’s form for exact placement).
Eligibility: Each “qualifying child” as defined by the federal Internal Revenue Code; credit amount varies by income level
Source: https://www.tax.newmexico.gov/new-mexico-child-tax-credit/
3. Low-Income Comprehensive Tax Rebate (LICTR)
A refundable rebate for low-income New Mexico resident filers. To qualify, all of the following must be true:
- New Mexico resident for the entire tax year
- Modified gross income of $36,000 or less (subject to annual inflation adjustment starting Tax Year 2023 per Section 7-2-14 NMSA 1978)
- Not claimed as a dependent on another taxpayer’s return
The rebate amount varies by income and is indexed for inflation.
Claimed on: Form PIT-RC, Rebate and Credit Schedule
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
4. Property Tax Rebate for Low-Income Seniors
A rebate for New Mexico resident senior taxpayers with low incomes who pay property tax or rent. Administered through the Taxation and Revenue Department. Refer to PIT-RC instructions for eligibility thresholds and rebate amounts.
Claimed on: Form PIT-RC
Source: https://www.tax.newmexico.gov/governments/municipal-county-governments/property-tax-rebate-for-personal-income-tax/
Non-Refundable Credits (Form PIT-CR)
Non-refundable credits reduce tax liability to zero but do not generate a refund. Claimed on Schedule PIT-CR, Non-Refundable Tax Credit Schedule.
5. Credit for Taxes Paid to Other States
New Mexico residents who earn income that is taxed both by New Mexico and another state may claim a credit for the taxes paid to the other state. This prevents double taxation for residents who work in another state without a reciprocal agreement.
Important: New Mexico does not have reciprocal agreements with any other state. Residents who work in another state must file both a New Mexico resident return and a nonresident return in the other state, then claim this credit on their New Mexico return.
The credit equals the lesser of (a) the actual tax paid to the other state on income also taxed by New Mexico, or (b) the New Mexico tax calculated on the same income.
Claimed on: Worksheet in PIT-1 instructions; reported on PIT-1
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
6. Business-Related Tax Credits
Various non-refundable business tax credits are available for qualifying activities such as film production, high-wage job creation, advanced energy equipment manufacturing, rural job creation, and others. These credits are primarily for businesses but may be claimed by individual filers with qualifying business activity.
Claimed on: Schedule PIT-CR with supporting documentation
Source: https://www.tax.newmexico.gov/tax-professionals/tax-credits-overview-forms/personal-income-tax-credits/
Filing Deadlines
Regular Deadline
April 15, 2026 for Tax Year 2025 returns
New Mexico’s income tax deadline aligns with the federal filing deadline.
Extension Deadline
October 15, 2026
New Mexico automatically grants an extension to file (but not to pay) if a federal extension is granted. If you do not have a federal extension, you must request a New Mexico extension separately.
Extension requirements:
- File extension request by April 15, 2026
- Pay any estimated tax owed by April 15, 2026 — failure to pay does not result in an extended due date for tax payments
- No specific New Mexico extension form is required if a federal extension is in place
Extension form: Refer to the New Mexico Taxation and Revenue Department’s extension of time to file page:
https://www.tax.newmexico.gov/individuals/file-your-taxes-overview/extension-of-time-to-file/
Estimated Tax Payments
If you receive income not subject to withholding (self-employment, investment income, rental income, etc.), you must make quarterly estimated tax payments to avoid an underpayment penalty.
Quarterly estimated payments are due on:
- Q1: April 15, 2026
- Q2: June 16, 2026
- Q3: September 15, 2026
- Q4: January 15, 2027
Form: PIT-ES, New Mexico Personal Income Tax Estimated Payment Voucher
Source: https://www.tax.newmexico.gov/individuals/file-your-taxes-overview/estimated-payments/
Filing Options
Online Filing (E-File) — Recommended
The New Mexico Taxation and Revenue Department encourages all taxpayers to file electronically. E-filed returns are typically processed within 2–4 weeks; paper returns may take 6–8 weeks.
New Mexico Official Online Portal (Taxpayer Access Point — TAP):
https://tap.state.nm.us/TAP/_/
File directly, make payments, manage your account, and check refund status.
IRS Free File / Tax Software:
Commercial software that supports New Mexico returns is available through IRS Free File for eligible taxpayers.
Paper Filing
Paper forms are available for download or by mail:
Primary form: Form PIT-1, New Mexico Personal Income Tax Return
Download: https://www.tax.newmexico.gov/individuals/online-services-overview/personal-income-tax-forms/
Call to request forms: 1-866-285-2996
In-person: Available at New Mexico Taxation and Revenue Department district offices and most public libraries throughout the state
Mailing address — With payment:
New Mexico Taxation and Revenue Department
P.O. Box 8390
Santa Fe, NM 87504-8390
(Include payment voucher PIT-PV with check)
Mailing address — Without payment:
Refer to the current year PIT-1 instructions for the applicable mailing address.
Tax Preparer Options
Licensed professionals familiar with New Mexico tax law include Certified Public Accountants (CPAs), Enrolled Agents (EAs), and tax attorneys. Free assistance is also available through VITA and AARP Tax-Aide for qualifying taxpayers.
Special Considerations for New Mexico Income Tax
Remote Workers and Multi-State Taxation
Living in New Mexico, Working for an Out-of-State Employer
As a New Mexico resident, you owe New Mexico income tax on all income from all sources, regardless of where your employer is located or where the work is performed.
What this means:
- Your employer’s state of incorporation does not determine your New Mexico tax obligation
- Remote work performed from New Mexico for a California, Texas, or any out-of-state employer is taxable in New Mexico
- Your employer should be withholding New Mexico income tax if you are a New Mexico resident working from within the state
Example: A New Mexico resident working remotely full-time from Albuquerque for a Colorado-based company owes New Mexico income tax on all wages. The employer should be withholding New Mexico tax, not Colorado tax.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Working in New Mexico, Living in Another State
Non-residents who perform work physically in New Mexico owe New Mexico income tax on income sourced to New Mexico.
Physical Presence Rule: Income is sourced to New Mexico based on where the work is physically performed. If you are present in New Mexico performing services, that income is New Mexico-source income.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
⚠️ Interstate Tax Risk Indicator
Remote workers with New Mexico connections commonly encounter multi-state taxation complications when their situation involves the following states:
Working with these states requires careful planning:
- New York — Applies the “convenience of the employer” rule; New Mexico residents working for New York employers may face New York tax claims on income earned from home
- California — Aggressive residency audits for individuals with California connections who claim nonresidency; extended work periods in California can trigger residency questions
- Pennsylvania — Over 200 local income tax jurisdictions; complex withholding and filing requirements for workers with Pennsylvania employer connections
- Connecticut — Complex credit system for taxes paid to other states
- Massachusetts — Previously applied telecommuter rules for work-from-home employees of Massachusetts employers
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/ and IRS Publication 505
“Convenience of the Employer” Rule
New Mexico does not apply a “convenience of the employer” rule. Non-residents are taxed only on income from work physically performed in New Mexico. If a nonresident works remotely from their home state for a New Mexico employer, that income is generally not subject to New Mexico income tax.
However, New Mexico residents should be aware that states where they physically travel to work (such as New York) may assert their own “convenience” rule even if New Mexico does not.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Reciprocal Agreements
New Mexico does not have reciprocal tax agreements with any other state.
This means New Mexico residents who work in another state are generally subject to that state’s income tax withholding requirements and must file a nonresident return in the other state. They may then claim a credit on their New Mexico resident return for taxes paid to the other state to avoid double taxation.
Conversely, residents of other states who work in New Mexico must file a New Mexico nonresident return for their New Mexico-source income.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/ and https://taxfoundation.org/research/all/state/state-reciprocity-agreements/
Multi-State Tax Filing for New Mexico Residents
When a New Mexico resident earns income in multiple states:
- File a New Mexico resident return (Form PIT-1) reporting all income from all sources
- File nonresident returns in other states where income was earned
- Claim a credit on the New Mexico return for taxes paid to other states
Forms required:
- Form PIT-1 — New Mexico Personal Income Tax Return
- Worksheet in PIT-1 instructions — Credit for Taxes Paid to Other States (entered on PIT-1)
- Schedule PIT-B — for income allocation if part-year resident
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
New Mexico Withholding for Nonresidents
New Mexico has a 15-day threshold before employer withholding is required for nonresident employees. In general terms, if a nonresident employee works in New Mexico for more than a de minimis period, the employer is required to begin withholding New Mexico state income tax from wages attributable to New Mexico work.
Nonresident employees whose income from New Mexico sources falls below the federal filing threshold may not owe New Mexico tax and may not need to file.
Source: https://taxfoundation.org/research/all/state/state-income-taxes-nonresidents/
Tax Residency vs Domicile
Domicile Defined
Domicile is your permanent legal home — the place where you intend to return and consider “home” indefinitely.
Key characteristics of domicile:
- A person can have only one domicile at a time
- Domicile continues until a new domicile is established with the intent to remain permanently
- Temporary absences from New Mexico do not change New Mexico domicile
- Intent is the critical factor — not merely physical presence
Factors establishing New Mexico domicile:
- Maintaining a primary residence in New Mexico
- Voter registration in New Mexico
- New Mexico driver’s license
- Homestead exemption filed on New Mexico property
- Family residing in New Mexico
- Bank accounts maintained in New Mexico
- Employment or business in New Mexico
- Professional and social affiliations in New Mexico
- Statements in legal documents (wills, trusts) indicating New Mexico domicile
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Residency Defined
Residency for New Mexico tax purposes is established by domicile. Unlike some states, New Mexico does not apply a strict day-count “statutory residency” rule that independently creates tax resident status based solely on physical presence.
A New Mexico resident is a person who is domiciled in New Mexico at any time during the tax year. A person may be a New Mexico resident only during part of the year (part-year resident) if they establish or relinquish New Mexico domicile during the year.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
| Critical Differences | ||
|---|---|---|
| Factor | Domicile | Residency |
| Number allowed | One at a time | Same as domicile in New Mexico |
| Based on | Intent + connections | Domicile in New Mexico |
| Changes when | New permanent home established with intent | Domicile changes |
| Tax impact | Full-year or part-year resident taxation | Taxed on all income during period of residency |
Common Conflict Scenarios
Scenario 1: New Mexico resident temporarily working in Texas
- Domicile: New Mexico (permanent home, family, voter registration)
- Temporary work assignment: Texas (4 months, temporary housing)
- Tax result: Remains a New Mexico resident for the full year; Texas has no income tax, so no credit issue. New Mexico taxes all income.
Scenario 2: Retiree moving from California to New Mexico
- Domicile until May: California (prior state)
- Domicile from May: New Mexico (new home purchased, intent to remain)
- Tax result: Part-year resident of both California and New Mexico. California taxes income earned while California domicile was maintained; New Mexico taxes income earned after New Mexico domicile was established.
Scenario 3: Snowbird with New Mexico winter home
- Domicile: Colorado (primary home, voter registration, professional ties)
- Winter presence: New Mexico (November through March)
- Tax result: Colorado resident; New Mexico does not tax the snowbird’s non-New Mexico income. If they earn New Mexico-source income (such as rental income from New Mexico property), they file a New Mexico nonresident return for that income only.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Burden of Proof
If New Mexico asserts that a taxpayer is a resident and the taxpayer disputes it, the burden typically falls on the taxpayer to prove non-residency. Maintaining clear records of domicile factors is essential for anyone who splits time between New Mexico and other states.
Common audit triggers:
- Maintaining a New Mexico driver’s license while claiming residency elsewhere
- Owning property in New Mexico with a homestead exemption while filing as a nonresident
- Family remaining in New Mexico while the taxpayer claims another domicile
- High-income individuals claiming nonresidency while maintaining strong New Mexico connections
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Documentation Commonly Requested in Residency Audits
| Primary Residency Evidence | |
|---|---|
| Document Type | What It Shows |
| Driver's License | State of legal residence |
| Voter Registration | Where voting rights are exercised |
| Vehicle Registration | Where vehicles are domiciled |
| Professional Licenses | State of professional domicile |
| Physical Presence Documentation | |
|---|---|
| Document Type | What It Shows |
| Day-Count Logs | Physical location by day |
| Travel Records | Interstate and intrastate travel patterns |
| Credit Card Statements | Geographic spending patterns |
| Cell Phone Records | Location data |
| E-ZPass / Toll Records | State line crossings |
| Property and Financial Ties | |
|---|---|
| Document Type | What It Shows |
| Property Records | Real estate ownership |
| Homestead Exemption Filing | Primary residence claim |
| Utility Bills | Physical occupancy patterns |
| Lease Agreements | Residence location |
| Bank Statements | Financial institution location |
| Social and Family Connections | |
|---|---|
| Document Type | What It Shows |
| School Enrollment | Where children attend school |
| Medical Records | Where regular healthcare is received |
| Religious Affiliation | Place of worship attendance |
| Club Memberships | Social and recreational ties |
| Employment Documentation | |
|---|---|
| Document Type | What It Shows |
| W-2 Forms | Employer location and wages |
| Employment Contract | Work location requirements |
| Remote Work Agreement | Authorization to work remotely |
| Intent Documentation | |
|---|---|
| Document Type | What It Shows |
| Will / Estate Documents | Stated domicile for estate purposes |
| Prior Tax Returns | Prior year residency claims |
| Insurance Policies | Address on file |
Burden of Proof: In New Mexico residency disputes, the burden typically falls on the taxpayer to prove non-residency or domicile elsewhere.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Note: This section provides factual information about documentation types commonly requested. It does not constitute legal or tax advice.
Military Personnel
Servicemembers Civil Relief Act (SCRA)
Active duty military members stationed in New Mexico due to military orders do not become New Mexico residents solely by reason of those orders. They pay income tax to their state of legal residence (domicile), not to New Mexico.
Military Spouses Residency Relief Act (MSRRA):
Military spouses may maintain their home state tax domicile and are not required to pay New Mexico income tax on income earned in New Mexico if:
- The spouse is present in New Mexico solely to accompany the servicemember
- The servicemember is in New Mexico under military orders
- The spouse maintains domicile in another state
Military spouses wishing to claim this exemption from New Mexico withholding must provide their employer with a completed withholding exemption form.
Related form: RPD-41348, Military Spouse Withholding Tax Exemption Statement
Source: https://realfile.tax.newmexico.gov/rpd-41348.pdf
Active Duty Pay
Active duty pay earned by active duty members of the U.S. Armed Forces is fully exempt from New Mexico income tax. This applies to New Mexico residents on active duty.
New Mexico resident military members must still file a PIT-1 return and use Schedule PIT-ADJ to deduct the exempt active duty pay.
Military Retirement Pay
New Mexico fully exempts military retirement pay from state income tax, effective Tax Year 2022. There is no income cap, age requirement, or phase-in period. Military retirees who are New Mexico residents may deduct their full military retirement benefit on Schedule PIT-ADJ.
Source: https://www.tax.newmexico.gov/wp-content/uploads/2022/07/Tax-laws-take-effect.pdf
What New Mexico-Domiciled Military Members DO Owe Tax On
Military members domiciled in New Mexico (who have not changed domicile to another state) owe New Mexico income tax on:
- Non-military income earned in New Mexico (side employment, business income, etc.)
- Investment income
- Rental income from New Mexico property
- Capital gains
- Retirement income from prior employment (other than military retirement)
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Retirees
| Social Security Benefits | |
|---|---|
| For most New Mexico retirees, Social Security benefits are not taxable. The exemption is available based on federal adjusted gross income (FAGI). | |
| Filing Status | Exemption Available If FAGI Is: |
| Single | Under $100,000 |
| Married Filing Jointly | Under $150,000 |
| Head of Household / Surviving Spouse | Under $150,000 |
| Married Filing Separately | Under $75,000 |
Retirees whose FAGI exceeds these thresholds must include their Social Security benefits in New Mexico taxable income. Claim the exemption on Schedule PIT-ADJ.
Pension and Retirement Account Distributions
Public and Private Pensions (General): New Mexico taxes pension income unless an exemption applies. Retirees age 65 and older may deduct up to $8,000 of pension, annuity, or retirement income from New Mexico taxable income, subject to income limits. Refer to the PIT-ADJ instructions for the applicable thresholds.
Military Pension: Fully exempt — see Military Personnel section above.
Railroad Retirement: Fully deductible on Schedule PIT-ADJ.
Public Pensions (Federal, State, Local): Taxable unless covered by the age-65 exemption above.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Retirement Account Distributions
401(k) and Traditional IRA: Distributions are taxable in New Mexico as ordinary income, consistent with federal treatment. Retirees age 65 and older may qualify for the $8,000 retirement income exemption described above.
Roth IRA: Qualified Roth IRA distributions that are excluded from federal income are also excluded from New Mexico income.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Students
College students attending school in New Mexico do not automatically become New Mexico residents for tax purposes.
You remain a nonresident if:
- You maintain legal residence (domicile) in another state
- Your presence in New Mexico is temporary for educational purposes
- You intend to return to your home state after graduation
You owe New Mexico tax only on New Mexico-source income:
- Wages earned from working in New Mexico while a student
- Business income from New Mexico sources
Establishing New Mexico residency as a student: Students CAN become New Mexico residents by taking steps to establish domicile — registering to vote in New Mexico, obtaining a New Mexico driver’s license, or otherwise demonstrating intent to remain permanently. However, merely living in New Mexico to attend school does not create domicile.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Part-Year Residents
If you moved TO or FROM New Mexico during 2025, you must file as a part-year resident using Form PIT-1 and Schedule PIT-B (Allocation and Apportionment of Income).
Income Allocation
- Report all income earned while a New Mexico resident (regardless of source)
- Report New Mexico-source income earned while a nonresident
- Exclude income from non-New Mexico sources earned while domiciled outside New Mexico
Moving TO New Mexico in 2025
- Determine the date you established New Mexico domicile (the day you moved in with intent to remain)
- Report all income from that date forward as New Mexico income
- File a nonresident (or part-year resident) return in your former state for income earned before moving
Moving FROM New Mexico in 2025
- Determine the date you relinquished New Mexico domicile (the day you established domicile elsewhere)
- Report all income through that date on the New Mexico return
- File a nonresident or part-year resident return in your new state for post-move income
Forms Required
- Form PIT-1 — New Mexico Personal Income Tax Return
- Schedule PIT-B — Allocation and Apportionment of Income (required for all part-year residents and nonresidents)
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Common Tax Filing Situations
These are factual clarifications based on official New Mexico state guidance and tax law.
Situation: “My employer is in Texas, so I don’t owe New Mexico state income tax.”
New Mexico law: New Mexico residents owe state income tax on all income from all sources, regardless of where the employer is located. If you are a New Mexico resident working remotely from New Mexico for a Texas-based employer, your income is fully taxable in New Mexico. Your employer should be withholding New Mexico income tax, not Texas tax (Texas has no income tax).
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Situation: “I work remotely full-time from my New Mexico home, so I don’t owe income tax anywhere.”
Tax law principle: All income is taxable in at least one jurisdiction. Remote work performed from New Mexico makes that income taxable in New Mexico. New Mexico residents must file a state income tax return if required to file a federal return.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Situation: “New Mexico doesn’t have reciprocity with my work state, so I’ll be double-taxed.”
State law: New Mexico does not have reciprocal agreements with other states, but double taxation is prevented by the Credit for Taxes Paid to Other States. As a New Mexico resident who earns income in another state, you file a nonresident return in that state and claim the resulting tax as a credit on your New Mexico resident return. Federal law (upheld by the U.S. Supreme Court in Comptroller of the Treasury of Maryland v. Wynne, 2015) prohibits two states from taxing the same income.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Situation: “I’m a part-year resident, so I just owe half the tax for the year.”
State law: Part-year residents owe New Mexico tax only on income earned during the period of New Mexico residency, plus any New Mexico-source income earned while a nonresident. The tax is calculated based on the actual income allocated to each period, not as a simple percentage of annual income. Use Schedule PIT-B to make the proper allocation.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Situation: “I’m a military spouse stationed in New Mexico. I have a part-time job here. Do I owe New Mexico tax?”
State law: Under the Military Spouses Residency Relief Act (MSRRA), a military spouse who is in New Mexico solely to accompany a servicemember on orders, and who maintains domicile in another state, is not required to pay New Mexico income tax on their earned income. To claim this exemption from withholding, the spouse must provide their employer with a completed RPD-41348, Military Spouse Withholding Tax Exemption Statement. If New Mexico tax was withheld in error, the spouse may file a New Mexico return to claim a refund.
Source: https://realfile.tax.newmexico.gov/rpd-41348.pdf
Situation: “I’m retired and my only income is Social Security and my pension. Do I need to file in New Mexico?”
State law: If your Social Security income falls below the AGI exemption threshold and your other income is below the federal filing requirement threshold, you may not be required to file a New Mexico return. However, if you are eligible for any New Mexico credits or rebates (such as the Low-Income Comprehensive Tax Rebate or Property Tax Rebate for seniors), you should file to claim them, even if not otherwise required. Always verify the current federal and state filing thresholds.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Situation: “I’m 100 years old. Do I still have to pay New Mexico income tax?”
State law: No. New Mexico provides a complete income tax exemption for all income of residents who are 100 years of age or older (centennial exemption). No New Mexico income tax is owed by qualifying centennial taxpayers.
Source: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
Penalties and Interest
Late Filing Penalty
New Mexico imposes a penalty for failure to file a return by the due date (or extended due date). The penalty is calculated as a percentage of unpaid tax. Refer to the current penalty and interest rate schedule for the exact percentage applicable to Tax Year 2025 returns.
Source: https://www.tax.newmexico.gov/individuals/file-your-taxes-overview/penalty-interest-rates/
Late Payment Penalty
A separate penalty applies for failure to pay tax by the April 15, 2026 due date, even if an extension was granted to file. An extension of time to file does not extend the time to pay. Estimated tax owed must be paid by the original deadline to avoid late payment penalties.
Source: https://www.tax.newmexico.gov/individuals/file-your-taxes-overview/penalty-interest-rates/
Interest on Unpaid Tax
Interest accrues on unpaid New Mexico income tax from the original due date until the tax is paid in full. Current interest rates are published on the Taxation and Revenue Department’s website and are updated periodically.
Current rates: https://www.tax.newmexico.gov/individuals/file-your-taxes-overview/penalty-interest-rates/
Underpayment of Estimated Tax Penalty
If you receive income not subject to withholding and fail to make adequate quarterly estimated tax payments, an underpayment penalty may apply. The penalty is generally avoided if your estimated payments total at least:
- 100% of your prior year’s New Mexico tax liability, OR
- 90% of your current year’s New Mexico tax liability
These are the standard safe harbor thresholds. Refer to PIT-1 instructions for details applicable to Tax Year 2025.
Form: PIT-ES, Estimated Tax Payment Voucher
Source: https://www.tax.newmexico.gov/individuals/file-your-taxes-overview/estimated-payments/ and https://www.tax.newmexico.gov/individuals/file-your-taxes-overview/penalty-interest-rates/
Penalty Avoidance
Penalties may be avoided if:
- The return is filed and any tax due is paid by the original April 15, 2026 deadline
- A valid extension was requested and any estimated tax was paid by April 15, 2026
- Adequate estimated tax payments were made throughout the year
Source: https://www.tax.newmexico.gov/individuals/file-your-taxes-overview/penalty-interest-rates/
Forms & Publications
Primary Tax Return Forms
Resident and nonresident return:
- Form PIT-1 — New Mexico Personal Income Tax Return (used by residents, part-year residents, and nonresidents)
- Instructions: Available in the Income Taxes folder on the Forms & Publications page
- Download: https://www.tax.newmexico.gov/individuals/online-services-overview/personal-income-tax-forms/
| Key Schedules | |
|---|---|
| Schedule | Purpose |
| PIT-ADJ | Schedule of Additions, Deductions, and Exemptions (Social Security, military pay, retirement income, etc.) |
| PIT-B | Allocation and Apportionment of Income (required for nonresidents and part-year residents) |
| PIT-CR | Non-Refundable Tax Credit Schedule |
| PIT-RC | Rebate and Credit Schedule (refundable credits: WFTC, LICTR, Child Tax Credit, etc.) |
| PIT-ES | Estimated Tax Payment Voucher |
Withholding Forms
- Employee withholding: Federal Form W-4 (New Mexico uses the federal form; no separate NM withholding certificate exists, but employees can file a separate W-4 with their employer for New Mexico-specific adjustments)
- Military spouse exemption: RPD-41348, Military Spouse Withholding Tax Exemption Statement
Exemption Certificates
- Military Spouse Withholding Exemption: RPD-41348
Download: https://realfile.tax.newmexico.gov/rpd-41348.pdf
Key Publications
- FYI-107 — An Individual’s Guide to New Mexico’s Withholding Tax
https://www.tax.newmexico.gov/governments/wp-content/uploads/sites/7/2021/04/FYI-107.pdf - FYI-104 — New Mexico Withholding Tax (employer guidance, updated November 2024)
https://www.tax.newmexico.gov/governments/wp-content/uploads/sites/7/2022/11/FYI-104_2025.pdf - FYI-106 — Claiming Business-Related Tax Credits for Individuals and Businesses
https://www.tax.newmexico.gov/tax-professionals/tax-credits-overview-forms/ - All Forms & Publications:
https://www.tax.newmexico.gov/forms-publications/
Where to Submit Paper Returns
With payment:
New Mexico Taxation and Revenue Department
P.O. Box 8390
Santa Fe, NM 87504-8390
Payment voucher: Include Form PIT-PV (Personal Income Tax Payment Voucher) with your check made payable to the New Mexico Taxation and Revenue Department. Do not combine state and federal payments.
Without payment / for refund:
Refer to the current PIT-1 instruction booklet for the applicable mailing address; the address may differ from the payment address.
Source: https://www.tax.newmexico.gov/individuals/online-services-overview/personal-income-tax-forms/
Information Verification Log
Where to Check for Updates
Current Tax Rate Tables:
https://www.tax.newmexico.gov/all-nm-taxes/current-historic-tax-rates-overview/personal-income-tax-rates/
Updated as rates change; historical rates also maintained.
Forms Library:
https://www.tax.newmexico.gov/forms-publications/
New tax year forms typically available in January each year.
Legislative Changes:
- New Mexico Legislature — Session information and bill text: https://www.nmlegis.gov/
- Tax Committee bills: https://www.nmlegis.gov/
Administrative Guidance and Rulings:
- New Mexico Administrative Code (regulations): https://www.tax.newmexico.gov/all-nm-taxes/statutes-with-regulations/
- Revenue rulings: https://www.tax.newmexico.gov/all-nm-taxes/rulings/
- Proposed regulations and hearing notices: https://www.tax.newmexico.gov/all-nm-taxes/proposed-regulations-hearing-notices/
News and Alerts:
- Department news releases: https://www.tax.newmexico.gov/news-alerts/
- Email notification service: https://www.tax.newmexico.gov/nm-taxation-revenue-department-notification-service/
Note: This page will be reviewed and updated in January 2027 for Tax Year 2026. For real-time updates, always consult the official New Mexico Taxation and Revenue Department website at https://www.tax.newmexico.gov.
Official New Mexico Income Tax Resources
All information in this guide is compiled exclusively from official government sources.
New Mexico Taxation and Revenue Department
- Main Website: https://www.tax.newmexico.gov/
- Personal Income Tax Overview: https://www.tax.newmexico.gov/individuals/personal-income-tax-information-overview/
- Tax Forms & Publications: https://www.tax.newmexico.gov/forms-publications/
- Personal Income Tax Forms: https://www.tax.newmexico.gov/individuals/online-services-overview/personal-income-tax-forms/
- Tax Rate Tables (Historic & Current): https://www.tax.newmexico.gov/all-nm-taxes/current-historic-tax-rates-overview/personal-income-tax-rates/
- Online Filing Portal (TAP): https://tap.state.nm.us/TAP/_/
- Where Is My Refund?: https://www.tax.newmexico.gov/individuals/online-services-overview/where-is-my-refund/
- Credits & Rebates: https://www.tax.newmexico.gov/individuals/file-your-taxes-overview/credits-rebates/
- New Mexico Child Tax Credit: https://www.tax.newmexico.gov/new-mexico-child-tax-credit/
- Extension of Time to File: https://www.tax.newmexico.gov/individuals/file-your-taxes-overview/extension-of-time-to-file/
- Estimated Payments: https://www.tax.newmexico.gov/individuals/file-your-taxes-overview/estimated-payments/
- Penalty & Interest Rates: https://www.tax.newmexico.gov/individuals/file-your-taxes-overview/penalty-interest-rates/
New Mexico Tax Code and Regulations
- New Mexico Income Tax Act (Section 7-2 NMSA 1978): https://www.tax.newmexico.gov/all-nm-taxes/statutes-with-regulations/
- HB 252 — 2025 Rate Restructuring: https://www.nmlegis.gov/Sessions/24%20Regular/bills/house/HB0252.HTML
- Legislative Session Summaries: https://www.tax.newmexico.gov/all-nm-taxes/fir/legislative-session-summary-bulletins/
Contact Information
Phone (toll-free): 1-866-285-2996
Hours: Monday–Friday, 8:00 AM – 5:00 PM Mountain Time
Mailing Address:
New Mexico Taxation and Revenue Department
1200 South St. Francis Drive
Santa Fe, NM 87504
Contact page: https://www.tax.newmexico.gov/contact-us/
Taxpayer Advocate
New Mexico Taxpayer Advocate:
https://www.tax.newmexico.gov/individuals/online-services-overview/taxpayer-advocate/
The Taxpayer Advocate assists individuals and businesses who believe they are experiencing an undue hardship due to a Department action.
Free Tax Assistance
VITA (Volunteer Income Tax Assistance):
Free tax preparation for qualifying taxpayers (generally income under $67,000).
Find locations: https://www.irs.gov/individuals/find-a-location-for-free-tax-prep
TCE (Tax Counseling for the Elderly):
Free tax assistance for seniors age 60 and older.
Find locations: https://www.irs.gov/individuals/tax-counseling-for-the-elderly
AARP Tax-Aide:
Free tax assistance for low-to-moderate income taxpayers, with special focus on those age 50 and older.
Find locations: https://www.aarp.org/money/taxes/aarp_taxaide/
Tax Glossary
Adjusted Gross Income (AGI):
Total income minus specific federal deductions (e.g., IRA contributions, student loan interest). New Mexico uses Federal Adjusted Gross Income (FAGI) as the starting point for calculating state taxable income.
New Mexico Taxable Income:
Federal AGI, plus any required New Mexico additions, minus New Mexico deductions and exemptions (standard or itemized deduction, low- and middle-income exemption, Social Security exemption, etc.).
Resident:
An individual who is domiciled in New Mexico at any time during the tax year.
Non-Resident:
An individual who is not domiciled in New Mexico but earns income from New Mexico sources.
Part-Year Resident:
An individual who moved into or out of New Mexico during the tax year, changing their domicile.
Domicile:
Your permanent legal home — the place you intend to return to indefinitely. A person can have only one domicile at a time.
Withholding:
Tax deducted from wages or other income by an employer or payer and sent to the state on the taxpayer’s behalf.
Reciprocity:
A formal agreement between states in which residents of one state working in the other pay tax only to their home state. New Mexico has no reciprocal agreements.
Tax Credit:
A dollar-for-dollar reduction in tax owed. A $500 credit reduces tax by $500. Refundable credits can generate a refund even if no tax is owed.
Tax Deduction:
Reduces taxable income. A $500 deduction at the 4.9% rate saves approximately $24.50 in tax.
Filing Status:
Category that determines applicable tax rates and standard deduction amounts: Single, Married Filing Jointly, Married Filing Separately, Head of Household, Surviving Spouse.
Standard Deduction:
A fixed dollar amount that reduces taxable income. New Mexico conforms to the federal standard deduction. For Tax Year 2025: $15,750 (single) / $31,500 (married filing jointly).
FAGI:
Federal Adjusted Gross Income — the income figure from your federal return used as the starting point for New Mexico tax calculations.
Schedule PIT-B:
New Mexico’s allocation schedule used by nonresidents and part-year residents to determine what portion of their income is subject to New Mexico tax.
Schedule PIT-ADJ:
New Mexico’s adjustment schedule used to report additions to and deductions from income, including Social Security exemptions, military pay exclusions, retirement income deductions, and other New Mexico-specific items.
Update History
February 2026 — Initial Publication
- Published comprehensive New Mexico income tax guide for Tax Year 2025 (returns filed in 2026)
- Documented 6-bracket structure enacted by HB 252 (Laws 2024, ch. 67), effective January 1, 2025
- Verified all rates directly from https://www.nmlegis.gov/Sessions/24%20Regular/bills/house/HB0252.HTML
- Documented Social Security exemption thresholds from official TRD release (January 2026)
- Confirmed no local income taxes and no reciprocal agreements with other states
- Verified military active duty pay exemption and military retirement pay full exemption (since 2022)
- All external links verified to official .gov sources
Verification Schedule
- Annual Update: January (new tax year rates and forms)
- Mid-Year Review: June (legislative changes from New Mexico Legislative Session)
- Continuous Monitoring: Emergency tax legislation, disaster relief, TRD announcements
- Source Link Check: Quarterly (all .gov URLs verified functional)
Last comprehensive update: February 2026
Next scheduled review: January 2027 (Tax Year 2026 updates)
Official updates source: https://www.tax.newmexico.gov/news-alerts/