Anyone who makes payments of amounts derived from oil and gas production from a well located in New Mexico (remitter) to a nonresident (remittee) of New Mexico must withhold tax from those payments. There are exceptions and adjustments to the requirement to withhold from a remittee. Please refer to form RPD-41284, Quarterly Oil and Gas Proceeds Withholding Tax Return Instructions.
The remitter must file and pay the tax using form RPD-41284, Quarterly Oil And Gas Proceeds Withholding Tax Return on the 25th day of the month following the end of the calendar quarter in which the taxes are withheld. The return and tax payment can be electronically filed and paid on the Department’s web file services page.
Additional annual filing is required. See Bulletin B-200.13 for a description of the latest changes.
- Annual statements of withholding must be filed with the Department for each recipient. Annual statements of withholding are filed using form RPD-41285,Annual Statement of Withholding of Oil and Gas Proceeds or federal form 1099-MISC.
- Remitters must also file a report of the remittees who have entered into an agreement with the remitter to pay the New Mexico tax required on the oil and gas proceeds. See RPD-41374, Annual Report of Non-Resident Remittees Holding an Agreement to Pay Tax on Oil and Gas Proceeds.
- The remitter must complete form RPD-41283, Annual Summary of Oil and Gas Proceeds Withholding Tax by the last day of February of the year following the calendar year in which withholding occurs, but is not required to submit the form to the Department. RPD-41283 remains in the records of the remitter.
If the remitter has more than 50 payees who receive New Mexico oil and gas proceeds to report, remitters are required to file Form RPD-41374 through the Department’s web site, and Forms 1099-Misc, pro-forma 1099-Misc or Form RPD-41285 electronically, either through the Combined Federal/State Filing Program or through the Department’s web site. If the remitter is unable to file electronically because a hardship exists and there is no reasonable access to the Internet in the taxpayer’s community, the remitter may request Department approval to file by paper. The remitter may request approval by filing Form RPD-41350, E-File Exception Request Form. The request must be received by the Department at least 30 days before the taxpayer’s electronic report is due.
New Mexico Taxation and Revenue Department
P.O. Box 25127
Santa Fe, NM 87504-5127
For assistance, call (505) 827-0825.
Or for tax return help, email us at CIT.TaxReturnHelp@state.nm.us
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Statutory Reference: Look for Chapter 7, Article 3A NMSA 1978 in the New Mexico State Statutes.