New Mexico Inheritance Laws: What You Should Know

New Mexico does not have a state inheritance or estate tax. However, inheritance laws can still get complicated, especially if the deceased dies without a valid will. In this guide, we’ll take an in-depth look at New Mexico’s inheritance laws, including the taxation of estates, the probate process and inheritance situations when someone dies without a will. If you want professional assistance with your estate planning, it can be helpful to find a financial advisor who specializes in the estate planning process.

New Mexico Inheritance and Estate Taxes

New Mexico collects neither an estate tax nor an inheritance tax. However, state residents still have to take into account the federal estate tax if their estate or the estate they are inheriting is more than $13.61 million in 2024. In addition, if you are inheriting property from another state, that state may have an estate tax that applies. You will also likely have to file some taxes on behalf of the deceased. So while there are no specific New Mexico taxes when inheriting assets, it doesn’t mean you absolutely won’t have to pay any tax.

Other Necessary Tax Filings

When you die, there are many federal and estate tax situations that need to become a priority for those who survive you. Besides the state estate tax, you need to look out for the following:

• Final individual federal and state income tax returns: The federal and state tax returns are due by tax day of the year following the individual’s death.
• Federal estate/trust income tax return: Due by tax day of the year following the individual’s death
• Federal estate tax return: Due nine months after the individual’s death, though an automatic six-month extension is available if asked for prior to the conclusion of the nine-month period. This is required only of individual estates that exceed a gross asset and prior taxable gift value of $13.61 million in 2024

Dying With a Will in New Mexico

In order for your will to be legitimate in New Mexico, you must sign your will in front of two witnesses, and your witnesses must sign your will in front of you and each other. You do not have to notarize your will in order to make it legal. However, you can make your will “self-proving,” which helps to speed up the probate process.

In order to make your will “self-proving” you will need to enlist the help of a notary. A “self-proving” will speeds up the probate process because the court can accept the will without contacting the signing witnesses. You can make your will self-proving if you and your witnesses go to a notary and sign an affidavit that states who you are and that each of you knew you were signing the will.

Once the will is determined to be valid, the next step is the probate process. New Mexico is one of the states with the Uniform Probate Code, which means there’s a standard set of rules that applies to New Mexico and other states. Probate proceedings are usually only required if the deceased person owned any assets in their name only. Other assets, also known as “non-probate” property, can generally be transferred to the other owner without probate.

New Mexico offers probate shortcuts for smaller estates. One shortcut allows inheritors to completely skip probate when the value of the entire estate after liens and encumbrances are subtracted, is worth $50,000 or less. All the heirs have to do is prepare a short affidavit, signed under oath, stating that they are entitled to certain assets.

When the inheritor goes to the person or institution holding the property, all they have to bring is the affidavit and a copy of the death certificate, and the person or institution will release the property to the inheritor. There is a 30-day waiting period for this type of shortcut.

Another shortcut is available when one spouse dies, provided that their principal residence is owned as community property and is valued at $500,000 or less for property tax purposes. If no other assets other than the principal residence require probate, the living spouse can file an affidavit with the county clerk. In addition, no one else must be eligible to inherit the property and all relevant debts must have been paid off. A copy of the home’s deed must be attached to the affidavit. There is a six-month waiting period for this type of shortcut.

Dying Without a Will in New Mexico

If you die without a valid will, you’ll lose control over what happens to your assets after your death. New Mexico inheritance laws label these types of estates “intestate,” which means there is no will or no valid will. The court will then follow intestate succession laws to determine who inherits your assets, and how much they get.

If there isn’t a will, the court will appoint someone, usually an adult child or surviving spouse, to be the executor or personal representative of the deceased. The executor or personal representative takes care of the estate of the decedent and makes sure that it is watched after.

Although there are usually extenuating factors when someone dies intestate, it’s best not to put your loved ones through that kind of stress. If you’re not sure what kind of estate plan you want to make, you can seek the help of a financial advisor specializing in legacy planning.

Spouses in New Mexico Inheritance Law

If you die in New Mexico without a will, your spouse’s inheritance is partially dependent upon how the two of you owned your property. Your spouse inherits your half of the community property, which is generally property acquired while you were married.

If you have separate property, which is a property you acquired before marriage, or gifts and inheritance given only to you (even during your marriage), your spouse will inherit all or a portion of it. The amount of separate property your spouse inherits depends on whether or not you have living descendants. If you do, they will get a share of your separate property.

Children in New Mexico Inheritance Law

If you have no spouse and any of your children are alive, they will be the only heirs to your estate. If you die with a spouse and children, your spouse will inherit all community property and 1/4 of your individual property. Your children will inherit 3/4 of your individual property.

Intestate Succession: Spouses and Children

Although biological children are still the most common type of child in intestate succession law, they are not the only type of children. Legally adopted children have just as much right to their intestate share as biological children do.

In addition, if the decedent placed their child up for adoption and that child was adopted by another family – other than your spouse – they are not legally eligible to receive an intestate inheritance from the decedent. However, foster children and stepchildren who were never legally adopted by the decedent are not eligible to receive a share as the decedent’s child.

Children born outside of marriage still receive their share as long as paternity was acknowledged by the decedent or otherwise established under New Mexico law. Any child born to the decedent’s wife during their marriage is assumed to be his child and will receive a share of the estate. The decedent’s children can still receive their share if they are born after the decedent’s death, as long as the child survives at least 120 hours after birth. Grandchildren will receive a share only if their parent is not alive to inherit.

Children who are conceived by assisted reproduction or born to a gestational carrier are eligible to receive a share of your estate, provided certain conditions were met. They will receive a share as long as you are the partner or spouse of your child’s birth mother and clearly acted as the child’s other parent within two years of the birth or intended to act as the child’s other parent, the child will usually receive a share of your estate. If the child was born to a gestational carrier, those same conditions apply, however, a child born to a gestational carrier can also inherit if your parent-child relationship was established by a court order.

Unmarried Individuals Without Children in New Mexico Inheritance Law

If the decedent has no spouses or children, the inheritance then goes to the closest living relatives, in the order listed in the chart below.

Intestate Succession: Extended Family

Although there’s an intestate process designed to make sure your family inherits, it is generally best to write your own will to ensure that all of your property ends up in the hands you want it in.

Non-Probate New Mexico Inheritances

The probate process can be difficult and expensive. However, you have some options when it comes to avoiding probate in New Mexico. These assets are also not affected by intestate succession laws, and instead, go directly to the named beneficiary. Listed below are some of the non-probate assets available in New Mexico.

• Any property in a living trust
• Life insurance policies
• 401(k)s, IRAs, other retirement accounts
• Securities in transfer-on-death accounts
• Pay-on-death bank accounts
• Real estate held by a transfer-on-death deed
• Joint tenancy real property

Other Situations in New Mexico Inheritance Law

New Mexico has survivorship rules. In order to inherit under New Mexico’s intestate succession law, the heir in question must survive the decedent by at least 120 hours. In addition, relatives conceived before you die but born after the decedent’s death are eligible to inherit as if they had been born while the decedent was alive. However, posthumous relatives must live at least 120 hours after birth in order to be eligible for their inheritance.

Immigration status is irrelevant when it comes to inheritance. If a relative of yours is entitled to a share of your assets, they can inherit no matter what their citizenship status is. Half-relatives inherit as much as “whole” relatives. For example, your half-sibling would get the same share as any other sibling.

If you give an heir property during your lifetime, the value of that gift can be subtracted from your relative’s share, but only if it is in writing at the time the gift was made, or if the heir admits it in writing.

Bottom Line

The state of New Mexico doesn’t have any specific estate or inheritance taxes. However, if you die without a will then the process of transferring your assets to your loved ones can get complicated. It’s important to make sure you understand the federal estate tax rules if you have a sizable estate but it’s also important to make sure you make a proper estate plan to fully protect your assets and pass them on how you prefer when you die.

Tips for Estate Planning

• Given the complexities of settling an estate, it may be a good idea to work with a financial advisor. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
• Before you can think about leaving a legacy to your heirs, you need to make sure your own retirement is secure. Our retirement calculator can help you see whether you’re on pace to meet your retirement income needs; then, you can see about having some money left over for your family.

Photo credit: ©iStock.com/TJohn M. Chase, ©iStock.com/edb3_16, ©iStock.com/DenisTangneyJr