New Mexico Tax Changes - October 2024

Week Of 10.07.2024

New Mexico Sales & Use Taxes—New Mexico court holds end-stage renal disease facilities can claim deduction a employers of heath care practitioners.

The New Mexico Court of Appeals has held that the taxpayers, as end-stage renal disease facilities, were entitled to a refund of gross receipts taxes based in the tax deduction allowed by NMSA 1978 § 7-9-93(A) and related regulations. The court noted that it has previously determined that an employer, including companies like the taxpayers in this case, may claim tax deductions under NMSA 1978 § 7-9-93(A) and the accompanying regulations so long as they employ health care practitioners. The hearing officer had found that all dialysis services provided to patients through the taxpayers’ end-stage renal disease facilities in New Mexico are overseen by a registered nurse licensed by the State of New Mexico. The court therefore found the taxpayers were entitled to claim the deduction as employers of health care practitioners—registered nurses in this case. The court found that the taxpayers are not outpatient facilities that would exclude them from claiming the deduction since end-stage renal disease facilities are not listed in the regulations spelling out which types of facilities are "outpatient facilities." The court also held that the Taxation and Revenue Department is estopped from withholding the deduction from the taxpayers. (In the Matter of the Consolidated Protests of ISD Renal, Inc. et al. v. N.M. Tax. and Rev. Dept., N.M. Ct App., Dkt. No. A-1-CA-40958, 10/07/2024.)

Week Of 09.30.2024

New Mexico Announces Local Gross Receipts Tax Rate Changes Effective January 1, 2025

The New Mexico Taxation and Revenue Department has issued the gross receipt tax rate schedule for counties and municipalities, effective January 1, 2025 through June 30, 2025. (Gross Receipts and Compensating Tax Rate Schedule Effective January 1, 2025 Through June 30, 2025, 10/01/2024.)

Local rate changes. The following local rate changes are effective January 1, 2025:

Bernalillo County: The rate for Los Ranchos de Albuquerque(Location Code 02-200) increases to 7.6250% (currently 7.1875%).

Cibola County: The rate for Grants (Location Code33-227) increases to 8.0000% (currently 7.8750%). 

Dona Ana County: The rate for Anthony (Water &Sanitation District) Municipality (Location Code 07-517) increases to 8.3775%(currently 8.3750%); the rate for Co Remainder (Water & Sanitation District) (Location Code 07-527) decreases to 6.7475% (currently 6.7500%); the rate for Downtown TIDD – Las Cruces (Location Code 07-132) increases to 8.0650%(currently 8.0625%); the rate for Hatch (Location Code 07-204) increases to7.5650% (currently 7.5625%); the rate for Las Cruces (Location Code 07-105)increases to 8.0650% (currently 8.0625%); the rate for Mesilla (Location Code07-303) increases to 7.9400% (currently 7.9375%); the rate for Sunland Park(Location Code 07-416) increases to 8.1900% (currently 8.1875%); and the rate for the Remainder of County (Location Code 07-007) decreases to 6.4975%(currently 6.5000%).

Sandoval County: The rate for Jemez Springs (Location Code29-217) increases to 7.4250% (currently 7.1875%). 

New Mexico Adopts Clean Car Tax Credit Regulations

The New Mexico Energy, Minerals and Natural Resources Department has issued regulations governing the application and certification procedures for the clean car personal income and corporate income tax credits (NMAC §§ 3.3.36.1 through 3.3.36.17 and NMAC §§ 3.4.23-1 through 3.4.23.17, effective 09/24/2024.)

Clean car tax credit. NMSA 1978 § 7-2-18.36 and NMSA 1978 § 7-2A-19.1, enacted in 2024 (see State Tax Update, 03/08/2024) allow a refundable personal income and a corporate income tax credit respectively for purchasing an electric vehicle, plug-in hybrid electric vehicle or fuel cell vehicle or who enter into a new lease of at least three years for one of these vehicles. The amount of the credit is as follows:

1. For taxable years beginning January 1, 2024 and prior to January 1, 2027: (a) $3,000 for a new electric vehicle, (b) $2,500 for a new plug-in hybrid electric vehicle or fuel cell vehicle, (c) $2,500 for a previously owned electric vehicle, and (d) $2,000 for a previously owned plug-in hybrid electric vehicle or fuel cell vehicle;

2. For a taxable year beginning January 1, 2027 and prior to January 1, 2028: (a) $2,220 for a new electric vehicle, (b) $1,850 for a new plug-in hybrid electric vehicle or fuel cell vehicle, (c) $1,850 for a previously owned electric vehicle, and (d) $1,480 for a previously owned plug-in hybrid electric vehicle or fuel cell vehicle;

3. For a taxable year beginning on January 1, 2028 and prior to January 1, 2029: (a) $1,470 for a new electric vehicle, (b) $1,225 for a new plug-in hybrid electric vehicle or fuel cell vehicle, (c) $1,225 for a previously owned electric vehicle, and (d) $980 for a previously owned plug-in hybrid electric vehicle or fuel cell vehicle; and

4. For the taxable year beginning January 1, 2029: (a) $960 for a new electric vehicle, (b) $800 for a new plug-in hybrid electric vehicle or fuel cell vehicle, (c) $800 for a previously owned electric vehicle, and (d) $640 for a previously owned plug-in hybrid electric vehicle or fuel cell vehicle.

‍