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Understanding Personal Income Tax in New Mexico

Filed under State Taxes. Fact checked on February 13, 2013.

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New Mexico's personal income tax is discussed.

If you are a resident or nonresident of New Mexico and receive taxable income individually from property owned or business transacted in New Mexico, you are subject to tax on net income. Therefore, if you are operating your business as an S corporation, partnership, limited liability company, or sole proprietorship, you will be subject to a personal income tax on your business income that passes through to you.

For single individuals, with taxable income:

over but not over tax is of the amount over
$0 $5,500 1.7% $0
$5,500 $11,000 $93.50 + 3.2% $5,500
$11,000 $16,000 $269.50 + 4.7% $11,000
$16,000   $504.50 + 4.9% $16,000

For heads of household, surviving spouses and married individuals filing joint returns, with taxable income:

over but not over tax is of the amount over
$0 $8,000 1.7% $0
$8,000 $16,000 $136 + 3.2% $8,000
$16,000 $24,000 $392 + 4.7% $16,000
$24,000   $768 + 4.9% $24,000

For married individuals filing separate returns, with taxable income:

over but not over tax is of the amount over
$0 $4,000 1.7% $0
$4,000 $8,000 $68 + 3.2% $4,000
$8,000 $12,000 $196 + 4.7% $8,000
$12,000   $384 + 4.9% $12,000

If your only activity in New Mexico is making sales and you do not own or rent real estate in the state you may be eligible to pay an alternative tax. Your sales in New Mexico must not exceed $100,000 to be eligible for the alternative tax. Your alternative tax (instead of the regular personal income tax) is 0.75 percent of gross receipts from sales in or into the state.

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