Small Business Saturday Tax Holiday
Gross Receipts Tax Holiday
This year’s Small Business Saturday New Mexico Gross Receipts Tax Holiday will be Saturday, November 28, 2020. For this one day, the state suspends collection of gross receipts tax on sales of qualifying items at certain small business. The tax holiday begins at 12:01 a.m. on Saturday, November 28, 2020 and concludes at midnight of Saturday, November 28, 2020.
During that time the law provides a deduction from gross receipts for retail sales of qualifying tangible personal property; in effect allowing the retailer to sell the items “tax free.”
B-200.31 Small Business Saturday Gross Receipts Tax Holiday contains a list of qualifying items, but please note the sales price of the property must be less than $500. Types of items that qualify are clothing, accessories, sporting goods, tools, books, art, cosmetics, musical instruments, cookware, bedding, furniture, toys, games, and electronics.
In order for a business to qualify for the deduction, it must maintain its primary place of business in New Mexico, and employ no more than 10 employees at any point during the year. Businesses that operate under a franchise agreement do not qualify to deduct their receipts under this tax holiday.
For more specific information for small businesses on how to take the deduction on their returns please see CRS-1 Filers Kit, For Reporting Gross Receipts, Withholding and Compensating Taxes, July through December 2020. This deduction is a separately stated deduction that should be placed on its own line and use a special deduction code D0-020.