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New Mexico Paycheck Calculator

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Use SmartAsset's paycheck calculator to calculate your take home pay per paycheck for both salary and hourly jobs after taking into account federal, state, and local taxes.

Overview of New Mexico Taxes

New Mexico has a progressive income tax system, with four brackets that are each dependent on income level and filing status. The tax rates, which vary from 1.70% to 4.90%, are ranked in the bottom 20 on a nationwide scale. No New Mexico cities levy local income taxes.

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  • Our Tax Expert

    Jennifer Mansfield, CPA Tax

    Jennifer Mansfield, CPA, JD/LLM-Tax, is a Certified Public Accountant with more than 30 years of experience providing tax advice. SmartAsset’s tax expert has a degree in Accounting and Business/Management from the University of Wyoming, as well as both a Masters in Tax Laws and a Juris Doctorate from Georgetown University Law Center. Jennifer has mostly worked in public accounting firms, including Ernst & Young and Deloitte. She is passionate about helping provide people and businesses with valuable accounting and tax advice to allow them to prosper financially. Jennifer lives in Arizona and was recently named to the Greater Tucson Leadership Program.

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New Mexico Paycheck Calculator

Photo credit: ©iStock.com/River North Photography

New Mexico Paycheck Quick Facts

  • New Mexico income tax rate: 1.70% - 4.90%
  • Median household income: $51,945 (U.S. Census Bureau)
  • Number of cities that have local income taxes: 0

How Your New Mexico Paycheck Works

When you get a new job in New Mexico, you will have to fill out a W-4 form. This is the form that your employer will use to figure out how much money to withhold from your paychecks for federal income taxes. That money goes to the IRS, which counts it toward your annual income taxes. There are a number of factors that affect how much you pay in federal income taxes, including your salary, marital status and number of dependents.

The IRS recently made major revisions to the Form W-4. It removed the option to claim allowances, as well as the option to claim personal or dependency exemptions. The new form also uses a five-step process that allows filers to declare additional income, and it requires you to enter annual dollar amounts for things such as total annual taxable wages, non-wage income as well as itemized and other deductions.

If you were hired before 2020, you only need to complete the new version of the form if you're changing jobs or adjusting your withholdings. All employees hired as of Jan. 1, 2020, however, must complete the updated form.

Your employer also withholds FICA taxes from your paychecks. Medicare and Social Security taxes together make up FICA taxes. Medicare tax is 1.45% of your wages and Social Security tax is 6.2% of your wages. Your employer will match that amount so your total contribution is double what you actually pay. If you earn over $200,000, wages in excess of that amount are subject to a 0.9% Medicare surtax, which employers do not match.

Also consider that your paycheck size depends on how often you get paid. If you get paid biweekly, your checks will be more frequent and smaller than if you get paid once a month.

New Mexico Median Household Income

YearMedian Household Income

New Mexico has fairly low income tax rates. The state has a progressive tax system with four brackets that are determined by income level and filing status. Single individuals in the Land of Enchantment pay 1.70% on the first $5,500 of their taxable income; 3.20% on income up to $11,000; 4.70% on income up to $16,000; and 4.90% on income over $16,000. The tax rates remain the same for those with other filing statuses, but the income levels shift.

No cities in New Mexico charge local income taxes, so you don’t have to worry about that.

If you are planning a move to New Mexico or if you are interested in refinancing a property in the state, take a look at our New Mexico mortgage guide. The guide details important information about rates and the different kinds of loans you’ll be considering when getting a mortgage in the state.

Income Tax Brackets

Single Filers
New Mexico Taxable IncomeRate
$0 - $5,5001.70%
$5,500 - $11,0003.20%
$11,000 - $16,0004.70%
Married, Filing Jointly
New Mexico Taxable IncomeRate
$0 - $8,0001.70%
$8,000 - $16,0003.20%
$16,000 - $24,0004.70%
Married, Filing Separately
New Mexico Taxable IncomeRate
$0 - $4,0001.70%
$4,000 - $8,0003.20%
$8,000 - $12,0004.70%
Head of Household
New Mexico Taxable IncomeRate
$0 - $8,0001.70%
$8,000 - $16,0003.20%
$16,000 - $24,0004.70%

A financial advisor in New Mexico can help you understand how taxes fit into your overall financial goals. Financial advisors can also help with investing and financial planning - including retirement, homeownership, insurance and more - to make sure you are preparing for the future.

How You Can Affect Your New Mexico Paycheck

If you opt to get benefits from your New Mexico employer, whatever you pay for those benefits will come out of your paycheck. They’ll also come out pre-tax (before income tax is removed). For example, if you get health insurance for you and your family through an employer-sponsored plan, your premiums will be deducted from your wages. The same goes for contributions to a retirement plan like a 401(k) or 403(b). Because these retirement accounts are pre-tax, upping your contributions to these will actually lower the amount of your income that is subject to taxes.

You can also shelter more of your money from taxes in a health savings account (HSA) or a flexible spending account (FSA). You can use these accounts to pay for medical-related expenses, like certain prescriptions and co-pays. A word of caution if you have an FSA: Only $500 will roll over annually, so whatever you put in above that amount is use-it-or-lose-it.

If you are worried about having to pay a lot of taxes in April, you can have your New Mexico employer withhold an extra dollar amount from each of your paychecks, say $20. This will decrease the size of your paychecks by that amount, but it will also help to spread out your tax burden over the entire year, thereby lowering the chances that you are hit with a big bill come tax season.

New Mexico Top Income Tax Rate

YearTop Income Tax Rate

Most Paycheck Friendly Places

SmartAsset's interactive map highlights the most paycheck friendly counties across the U.S. Zoom between states and the national map to see data points for each region, or look specifically at one of the four ranking factors in our analysis: Semi-Monthly Paycheck, Purchasing Power, Unemployment Rate, and Income Growth.

Rank County Semi-Monthly Paycheck Purchasing Power Unemployment Rate Income Growth

Methodology To find the most paycheck friendly places for counties across the country, we considered four factors: semi-monthly paycheck, purchasing power, unemployment rate and income growth.

First, we calculated the semi-monthly paycheck for a single individual with two personal allowances. We applied relevant deductions and exemptions before calculating income tax withholding. To better compare withholding across counties, we assumed a $50,000 annual income. We then indexed the paycheck amount for each county to reflect the counties with the lowest withholding burden, or greatest take-home pay.

We then created a purchasing power index for each county. This reflects the counties with the highest ratio of household income to cost of living. We also created an unemployment index that shows the counties with the lowest rate of unemployment. For income growth, we calculated the annual growth in median income throughout a five year period for each county and then indexed the results.

Finally, we calculated the weighted average of the indices to yield an overall paycheck friendliness score. We used a one-half weighting for semi-monthly paycheck and a one-sixth weighting for purchasing power, unemployment rate and income growth. We indexed the final number, so higher values reflect the most paycheck friendly places.

Sources: SmartAsset, government websites, US Census Bureau 2018 American Community Survey, MIT Living Wage Study, Bureau of Labor Statistics