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New Mexico Income Tax Calculator

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Overview of New Mexico Taxes

New Mexico has a progressive income tax with rates that rank among the 20 lowest in the country. The state’s average effective property tax rate is also on the lower side. The state does not collect a sales tax, but rather a gross receipts tax on businesses that often gets passed to consumers.

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Household Income
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Location
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Filing Status
401(k) Contribution
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IRA Contribution
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Itemized Deductions
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Number of State Personal Exemptions
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Your Income Taxes Breakdown

Tax Type Marginal 
Tax Rate
Effective 
Tax Rate
2021 
Taxes*
Federal
FICA
State
Local
Total Income Taxes
Income After Taxes
Retirement Contributions
Take-Home Pay

* These are the taxes owed for the 2021 - 2022 filing season.

Your 2021 Federal Income Tax Comparison

  • Your marginal federal income tax rate
  • Your effective federal income tax rate
  • Your federal income taxes

Total Estimated 2021 Tax Burden

Income Tax $
Sales Tax $
Fuel Tax $
Property Tax$
Total Estimated Tax Burden $
Percent of income to taxes = %
$
  • About This Answer

    Our income tax calculator calculates your federal, state and local taxes based on several key inputs: your household income, location, filing status and number of personal exemptions. Also, we separately calculate the federal income taxes you will owe in the 2020 - 2021 filing season based on the Trump Tax Plan.

    How Income Taxes Are Calculated

    • First, we calculate your adjusted gross income (AGI) by taking your total household income and reducing it by certain items such as contributions to your 401(k).
    • Next, from AGI we subtract exemptions and deductions (either itemized or standard) to get your taxable income. Exemptions can be claimed for each taxpayer as well as dependents such as one’s spouse or children.
    • Based on your filing status, your taxable income is then applied to the the tax brackets to calculate your federal income taxes owed for the year.
    • Your location will determine whether you owe local and / or state taxes.
    ...read more
  • Last Updated: January 1, 2021

    When Do We Update? - We regularly check for any updates to the latest tax rates and regulations.

    Customer Service - If you would like to leave any feedback, feel free to email info@smartasset.com.

    ...read more
  • Our Expert

    ...read more
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Taxes in New Mexico

New Mexico State Tax Quick Facts

  • Income tax: 1.7% - 5.9%
  • Sales tax: None (gross receipts tax of 5.125% to 9.25% effectively acts as a sales tax)
  • Property tax: 0.78% average effective rate
  • Gas tax: 17.00 cents per gallon of regular gasoline, 21.00 cents per gallon of diesel

Taxpayers in the Land of Enchantment pay three primary forms of state and local taxes: a state income tax, local property taxes and state and local gross receipts taxes. New Mexico ranks below the national average for each of these taxes.

Of course, the impact of these taxes varies depending on the financial circumstance of each taxpayer. Below we will take a closer look at the rules and exceptions for each of these taxes individually, as well as a few others such as the gas and cigarette taxes.

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.

New Mexico Income Taxes

New Mexico’s income tax system is modeled after the federal income tax, though it has fewer income tax brackets and significantly lower rates. As shown in the table below, there are four income brackets, with higher tax rates applying to higher earnings.

Income Tax Brackets

Single Filers
New Mexico Taxable IncomeRate
$0 - $5,5001.70%
$5,500 - $11,0003.20%
$11,000 - $16,0004.70%
$16,000 - $210,0004.90%
$210,000+5.90%
Married, Jointly Filing
New Mexico Taxable IncomeRate
$0 - $8,0001.70%
$8,000 - $16,0003.20%
$16,000 - $24,0004.70%
$24,000 - $315,0004.90%
$315,000+5.90%
Married, Separately Filing
New Mexico Taxable IncomeRate
$0 - $4,0001.70%
$4,000 - $8,0003.20%
$8,000 - $12,0004.70%
$12,000 - $157,5004.90%
$157,500+5.90%
Head of Household
New Mexico Taxable IncomeRate
$0 - $8,0001.70%
$8,000 - $16,0003.20%
$16,000 - $24,0004.70%
$24,000 - $315,0004.90%
$315,000+5.90%

Rules for filing taxes in New Mexico are very similar to the federal tax rules. Deductions, both itemized and standard, match the federal deductions. For tax year 2021, that means single filers can claim a standard deduction of $12,550 and joint filers can claim a standard deduction of $25,100. State and local taxes are not deductible in New Mexico, so any filers claiming that itemized deduction on their federal tax return must add it back to their state taxable income.

Deduction amounts for personal exemptions are suspended for tax years 2018 through 2025 by the 2017 federal Tax Cuts and Jobs Act. In addition to that federal exemption, low- and middle-income earners may claim a $2,500 exemption for each federal exemption claimed. For single filers, anyone earning $36,667 or less may claim this exemption. For married persons filing separately, the cutoff is $27,500. For married persons filing jointly or heads of household, the cutoff is $55,000.

Using those rules for exemptions and deductions, New Mexico taxpayers can determine their taxable income and calculate their New Mexico income tax based on the rates above. After an initial tax amount is determined, there are certain rebates and credits that can be claimed to reduce the amount of taxes owed.

The available rebates and credits include the low-income comprehensive tax rebate (available to earners making less than $36,000 per year), the child day care credit, the refundable medical care credit (for taxpayers age 65 or older), the special needs adopted child tax credit and the working families tax credit.

New Mexico Capital Gains Tax

While capital gains are taxable as personal income in New Mexico, the state allows taxpayers with income from capital gains to claim a special tax deduction. That deduction is equal to up to 40% of the total income from net capital gains or $1,000 of the net capital gains reported, whichever is larger.

New Mexico Sales Tax

New Mexico doesn’t technically have a sales tax. Businesses are charged a gross receipts tax, which is collected at the state, county and city levels. This is often passed on to consumers by either adding it to the price or explicitly spelling it out on the invoice. The statewide gross receipts tax rate is 5.125%, while city and county taxes can add up to a total of 4.125%. The table below shows state, county and city rates in every county in New Mexico, as well as some of the largest cities.

Gross Receipts Tax Rates(Updated January 2022)

County
CountyState RateCounty RateTotal Sales Tax
Bernalillo County5.125%1.313%6.438%
Catron County5.125%0.563%5.688%
Chaves County5.125%1.396%6.521%
Cibola County5.125%1.688%6.813%
Colfax County5.125%0.958%6.083%
Curry County5.125%1.000%6.125%
De Baca County5.125%1.563%6.688%
Doña Ana County5.125%1.625%6.750%
Eddy County5.125%0.833%5.958%
Grant County5.125%1.438%6.563%
Guadalupe County5.125%1.313%6.438%
Harding County5.125%1.000%6.125%
Hidalgo County5.125%1.063%6.188%
Lea County5.125%0.375%5.500%
Lincoln County5.125%0.375%5.500%
Los Alamos County5.125%2.188%7.313%
Luna County5.125%1.750%6.875%
McKinley County5.125%1.625%6.750%
Mora County5.125%1.646%6.771%
Otero County5.125%1.188%6.313%
Quay County5.125%1.563%6.688%
Rio Arriba County5.125%1.750%6.875%
Roosevelt County5.125%1.500%6.625%
San Juan County5.125%1.438%6.563%
San Miguel County5.125%1.708%6.833%
Sandoval County5.125%1.250%6.375%
Santa Fe County5.125%2.000%7.125%
Sierra County5.125%1.813%6.938%
Socorro County5.125%1.250%6.375%
Taos County5.125%2.188%7.313%
Torrance County5.125%1.625%6.750%
Union County5.125%0.938%6.063%
Valencia County5.125%1.750%6.875%
City
CityState RateCounty + City RateTotal Sales Tax
Alamogordo5.125%2.875%8.000%
Albuquerque5.125%2.750%7.875%
Anthony5.125%3.250%8.375%
Artesia5.125%2.771%7.896%
Bernalillo5.125%2.063%7.188%
Carlsbad5.125%2.521%7.646%
Chaparral5.125%1.625%6.750%
Clovis5.125%3.063%8.188%
Corrales5.125%2.688%7.813%
Deming5.125%3.125%8.250%
Enchanted Hills5.125%1.250%6.375%
Española5.125%3.813%8.938%
Farmington5.125%3.125%8.250%
Gallup5.125%3.188%8.313%
Grants5.125%3.000%8.125%
Hobbs5.125%1.688%6.813%
Las Cruces5.125%3.188%8.313%
Las Vegas5.125%3.271%8.396%
Los Alamos5.125%2.188%7.313%
Los Lunas5.125%3.550%8.675%
Lovington5.125%2.125%7.250%
North Valley5.125%1.313%6.438%
Portales5.125%3.063%8.188%
Rio Rancho5.125%2.563%7.688%
Roswell5.125%2.708%7.833%
Santa Fe5.125%3.313%8.438%
Silver City5.125%2.875%8.000%
Socorro5.125%2.313%7.438%
South Valley5.125%1.313%6.438%
Sunland Park5.125%3.313%8.438%

The gross receipts tax applies to goods and services, with some exceptions. The most significant is the exemption for food. Food that is intended for immediate consumption (e.g. food ordered at a restaurant) is not exempt, however. Prescription drugs are also exempt from gross receipts taxes in New Mexico.

New Mexico Property Tax

Property taxes in New Mexico go to support local governments and schools. The state’s average effective property tax rate (annual tax payments as a percentage of home value) is 0.78%, which is the 18th-lowest rate in the country. If you are thinking about buying a property in New Mexico or refinancing a mortgage, take a look at our New Mexico mortgage guide. It has everything you need to know about New Mexico’s mortgage rates and other mortgage-related details.

New Mexico Cigarette Tax

New Mexico’s cigarette tax stands at $2.00 per pack. That’s about average for cigarette taxes in the U.S. In addition to the cigarette tax, New Mexico also imposes the Tobacco Products Tax, which applies to the manufacture or purchase of other types of tobacco products. It is equal to 25% of the value of any tobacco product.

New Mexico Alcohol Tax

Excise taxes on alcohol in New Mexico vary depending on the type of beverage being sold. Hard liquor (vodka, whiskey, etc.) is taxed at a rate of $6.06 per gallon. Beer is taxed at a rate of 41 cents per gallon, or about 3.8 cents per 12 ounce beer. Wine is taxed at a rate of $1.70 per gallon.

New Mexico Estate Tax

New Mexico’s estate tax has been phased out as of Jan. 1, 2005. There is no estate or inheritance tax in New Mexico.

Photo credit: flickr
  • The Very Large Array in Socorro County consists of 27 separate radio antennae, each of which weighs more than 200 tons.
  • Truth or Consequences, New Mexico is named after a game show from the 1950s.
  • Los Alamos, New Mexico has the highest concentration of millionaires of any city in the U.S. More than 10% of households in Los Alamos have a net worth of at least $1 million.