New Mexico individual income tax

Last updated on March 31, 2023

New Mexico levies an individual income tax on both residents and nonresidents, calculated using their federal-adjusted gross income, with rates ranging from 1.7% to 5.9%.

April 18

Return due in 2023

5.9%

Top marginal tax rate

Page sponsor

StartGlobal: Legal + Taxes + Bookkeeping for solopreneurs

$599 one-time

Why we like StartGlobal?

My genuine thoughts

Willy Justin

Founder, Statepedia

StartGlobal: Legal + Taxes + Bookkeeping for solopreneurs

Product

For small businesses, managing taxes, accounting and everything legal is just a pain. Nobody wants to do it, but they have to. Instead of working with CPAs, attorneys and others separately, Start brings all of them under a single subscription. It’s just smooth.

Team

I know the team behind StartGlobal very well. It’s a very hardworking group of individuals who are genuinely passionate about small businesses. They are backed by successful founders like Balaji Srinivasan, Biz Stone(Twitter) and others.

Price

Getting a CPA or attorney is a matter of thousands of dollars. It’s just unfair to pay so much when you’re a small business. Start has a single subscription that covers it all. It is a definite money saver.

$599 one-time

Pay income tax online

Visit the official state government’s website to pay individual income tax online.

Visit TaxNewMexico
Tool screenshot

What is New Mexico income tax?

Individual income tax

Individual income tax is a type of direct tax levied by New Mexico on individuals that meet the taxable criteria.

Taxable incomes

New Mexico taxes incomes from wages, dividends, interests and capital gains.

Tax brackets

New Mexico has 7 individual income tax brackets from 1.7% to 5.9%.

Standard deduction

Standard deduction is $12,950 for single filers and $25,900 for joint filers for the year 2022.

Personal exemption

New Mexico doesn't have personal exemption.

2022 tax rates

The following is the list of income tax rates for the tax year of 2022

New Mexico taxable incomeTax rate
$0 - $4,0001.7%
$4,000 - $8,0003.2%
$8,000 - $12,0004.7%
$12,000 - $157,5004.9%
$157,500+5.9%

Individual income tax

The State of New Mexico requires you to pay taxes if you are a resident (regardless of the whether they were earned within the state or not) or a non-resident that earns income from New Mexico

Types of taxable incomes

The income types on which tax is levied are:

  • In New Mexico, all types of income are generally subject to personal income tax unless they are specifically exempt by state law. This includes, but is not limited to, wages and salary, dividends, capital gains, royalties, and other types of income.

File return

To file a tax return in New Mexico, taxpayers must complete and submit a tax return form. The tax return form requires taxpayers to report their taxable income and any credits or deductions they are eligible to claim. Taxpayers must also calculate their tax liability and pay any taxes owed by the due date.

Due

quarterly or annually

Pay taxes

Taxes in New Mexico are due by 18 April, 2023. Go to the official New Mexico Taxation & Revenue's website.

  • In New Mexico, you are required to pay quarterly estimated taxes if you tax liability after withholding and credits is more than $500.

  • Estimated taxes are to be made quarterly in instalments by the 15th of April, June, September, and January.

Type of tax

graduated tax

Due

quarterly or annually

Deductions

Tax deductions are a reduction in the amount of income that is subject to taxation. It allows taxpayers to lower the amount of taxable income they have, which in turn reduces the amount of tax they owe. Tax deductions are available for a wide range of expenses, such as charitable donations, mortgage interest, medical expenses, and business expenses.

  • In New Mexico, standard deduction is $12,950 for single filers and $25,900 for joint filers for the year 2022.

Credits

A tax credit allows taxpayers to reduce the amount of taxes they are required to pay. This is different from a tax deduction, which reduces the amount of income that is subject to taxation. Tax credits are applied directly to the tax liability, while deductions are applied to the taxable income.

Exclusions

Tax exclusions are an amount of money or income that is not subject to taxation. This means that taxpayers do not have to pay taxes on this income.

Residency

Residency in New Mexico refers to an individual's permanent home or place of residence in the state.

New Mexico resident

A New Mexico resident is someone who is domiciled in New Mexico, or who maintains a permanent place of residence in the state.

  • Any person who is physically present in New Mexico for more than 185 days is also considered a resident.

New Mexico First-Year Resident

If you moved to New Mexico during the tax year with the intention of making it your permanent residence, you are considered a first-year resident. It is not necessary for a first-year resident to have physically lived in New Mexico for at least 185 days.

  • First Year Resident is can come into the state any time during the year and should be present on Dec 31st.

New Mexico part-year resident

A New Mexico Part-Year Resident is someone who moved into or out of the state during the tax year.

  • A taxpayer is considered a part-resident if he/she is not domiciled in the state on Dec 31st.

  • Income earned while the individual was a resident of New Mexico is subject to state taxes.

New Mexico non-resident

A New Mexico Nonresident is someone who does not have a permanent residence in the state.

  • Nonresidents who receive income from New Mexico sources are required to pay New Mexico taxes.

Frequently asked questions

Business entities in New Mexico

There are several business entities in New Mexico

New Mexico LLC

Page written and verified by independent sources

If you like this page, maybe buy us a coffee?

Page sponsor

StartGlobal: Legal + Taxes + Bookkeeping for solopreneurs

$599 one-time

Why we like StartGlobal?

My genuine thoughts

Willy Justin

Founder, Statepedia

StartGlobal: Legal + Taxes + Bookkeeping for solopreneurs

Product

For small businesses, managing taxes, accounting and everything legal is just a pain. Nobody wants to do it, but they have to. Instead of working with CPAs, attorneys and others separately, Start brings all of them under a single subscription. It’s just smooth.

Team

I know the team behind StartGlobal very well. It’s a very hardworking group of individuals who are genuinely passionate about small businesses. They are backed by successful founders like Balaji Srinivasan, Biz Stone(Twitter) and others.

Price

Getting a CPA or attorney is a matter of thousands of dollars. It’s just unfair to pay so much when you’re a small business. Start has a single subscription that covers it all. It is a definite money saver.

$599 one-time