Frequently Asked Questions
What is New Mexico’s personal income tax rate?
New Mexico uses a seven-bracket, graduated-rate table ranging from 1.7% to 4.9% of taxable income. back to list
Who is required to file?
Two situations require you to file personal income tax returns in New Mexico: If you are required to file a federal tax return with the IRS and you are a New Mexico resident, you must file a state income tax return, and If you are required to file a federal income tax...
How do I determine if I’m a resident or a nonresident?
Please see the Personal Income Tax Instructions for definitions of a resident, nonresident ,first-year resident , part-year resident, and residency for military personnel. back to list
What forms do I need to file New Mexico personal income taxes?
The forms you need depend on two factors: your financial status and your residency category. Please see the Personal Income Tax Instructions for guidance back to list
Does New Mexico offer a credit for income tax paid to another state?
Yes, but only for New Mexico state residents. The credit is based on the tax the other state imposes on the portion of gross income that is also included in New Mexico gross income. The credit may not exceed the New Mexico income tax liability, nor can it be more than...
Does New Mexico offer tax breaks to active duty military members?
Yes. Active duty income earned by active duty members of the armed forces is exempt from New Mexico’s personal income tax. File a PIT-1 resident tax return and use a PIT-ADJ schedule to deduct any military active duty pay. back to list
How is residency determined for active duty military members and their spouses?
Military personnel are subject to special residency rules. A person serving in the United States Armed Forces does not become a resident of New Mexico solely because he or she is present in New Mexico on military orders even when physically present in this state for...
Does New Mexico offer a tax break for working families?
Yes. A refundable tax credit has been added. It totals ten percent of the federal earned income tax credit for which a taxpayer is currently eligible. There is also an exemption for low-and middle-income taxpayers that is based upon adjusted gross income. To qualify...
Does New Mexico offer a tax break to retirees?
Yes. Depending on income level, taxpayers 65 years of age or older may be eligible for a deduction from taxable income of up to $8,000 each. Low-income taxpayers may also qualify for a property tax rebate even if they rent their primary residence. Beginning with tax...
If I have an Automatic Extension of Time to File with the IRS do I need to file an extension with New Mexico?
No, New Mexico honors any federal extension of time to file that you have. You do not need to request a separate state extension if you already have a federal extension. If you require additional time than what is granted at the federal level, you must file a New...