1. All NM Taxes
  2. Frequently Asked Questions
  3. Is New Mexico’s corporate franchise tax subject to the same nexus guidelines as corporate income tax?

Is New Mexico’s corporate franchise tax subject to the same nexus guidelines as corporate income tax?

Federal P.L. 86-272 does not provide immunity from the corporate franchise tax. New Mexico’s corporate franchise tax is imposed on all domestic and foreign corporations, including S corporations, that engage in business in New Mexico or exercise their corporate franchise in this state, whether actively engaged in business or not.