N.M. Stat. § 7-3-3 (2026)

A. Every employer who deducts and withholds a portion of an employee's wages for
payment of income tax under the provisions of the Internal Revenue Code shall deduct
and withhold an amount for each payroll period computed from a state withholding tax
table furnished by the department; provided:

      (1)   if the employee instructs the employer to withhold a greater amount, the
employer shall deduct and withhold the greater amount;

      (2)    if the employee is not a resident of New Mexico and is to perform services
in New Mexico for fifteen or fewer days cumulatively during the calendar year, the
employer is not required to deduct and withhold an amount from that employee's wages;
and

      (3)    if the aggregate monthly amount withheld under this section would be less
than one dollar ($1.00) for an employee, the employer shall not be required to deduct
and withhold wages in regard to that employee.
    B. The department shall devise and furnish a state withholding tax table based on
statutes made and provided to employers required to withhold amounts under this
section. This table shall be devised to provide for a yearly aggregate withholding that
will approximate the state income tax liability of average taxpayers in each exemption
category.

    C. If an individual requests in writing that the payor deduct and withhold an amount
from the amount of the pension or annuity due the individual, the payor making payment
of a pension or annuity to an individual domiciled in New Mexico shall deduct and
withhold the amount requested to be deducted and withheld, provided that the payor is
not required to deduct and withhold any amount less than ten dollars ($10.00) per
payment. The written request shall include the payee's name, current address, taxpayer
identification number and, if applicable, the contract, policy or account number to which
the request applies.

    D. Every person in New Mexico who is required by the provisions of the Internal
Revenue Code to deduct and withhold federal tax from payment of winnings that are
subject to withholding shall deduct and withhold from such payment a tax in an amount
equal to six percent of the winnings, except that an Indian nation, tribe or pueblo or an
agency, department, subdivision or instrumentality thereof is not required to deduct or
withhold from payments made to members or spouses of members of that Indian nation,
tribe or pueblo.

History: 1953 Comp., § 72-15-51, enacted by Laws 1961, ch. 243, § 3; 1990, ch. 64, §
2; 1995, ch. 11, § 9; 1996, ch. 16, § 4.

                                    ANNOTATIONS

Cross references. — For the Internal Revenue Code, see 26 U.S.C. § 1 et seq.

Temporary provisions. — Laws 2020 (1st S.S.), ch. 4, § 4, effective June 29, 2020,
provided:

A. Notwithstanding Sections 7-1-67 and 7-1-69 NMSA 1978, no interest shall accrue
and no penalty shall be assessed to a taxpayer for:

(1) tax liabilities pursuant to the Income Tax Act or the Corporate Income and
Franchise Tax Act for failure to pay the tax that became due April 15, 2020 through July
15, 2020; provided that the failure to pay the tax was made without intent to evade or
defeat the tax; and provided further that payment for the unpaid payments is made in
full on or before April 15, 2021;

(2) tax liabilities pursuant to the Withholding Tax Act for failure to pay the tax that
became due March 25, 2020 through July 25, 2020; provided that the failure to pay the
tax was made without intent to evade or defeat the tax; and provided further that
payment for the unpaid taxes is made in full on or before April 25, 2021;
(3) gross receipts tax, local option gross receipts tax or compensating tax liabilities for
failure to pay any of those taxes that became due March 25, 2020 through July 25,
2020; provided that the failure to pay the tax was made without intent to evade or defeat
the tax; and provided further that payment for the unpaid taxes is made in full on or
before April 25, 2021; and

(4) tax liabilities assessed between September 3, 2019 and January 3, 2020 as the
result of a managed audit performed in accordance with a managed audit agreement
pursuant to Section 7-1-11.1 NMSA 1978; provided that payment for those liabilities is
made pursuant to terms of the managed audit agreement on or before December 31,
2020.

B. Notwithstanding Sections 7-38-49 and 7-38-50 NMSA 1978, no interest shall accrue
and no penalty shall be assessed to a property owner for unpaid property taxes that
became due April 10, 2020 pursuant to Section 7-38-38 NMSA 1978; provided that:

(1) the unpaid property taxes did not become delinquent because of an intent to
defraud by the property owner;

(2) payment for the unpaid property taxes is made in full on or before May 10, 2021;
and

(3) the subject property does not have property taxes that became delinquent pursuant
to Section 7-38-46 NMSA 1978 prior to May 10, 2020.

The 1996 amendment, effective April 1, 1996, added Subsection D.

The 1995 amendment, effective July 1, 1995, designated the first sentence of
Subsection A as Paragraph A(1) and added Paragraphs A(2) and A(3); designated the
former second sentence of Subsection A as Subsection B and deleted a proviso at the
end thereof which read "Provided that if that aggregate monthly amount withheld under
this section would be less one dollar ($1.00) for an employee, the employer shall not be
required to deduct and withhold wages in regard to that employee"; and redesignated
former Subsection B as Subsection C and made a stylistic change therein.

The 1990 amendment, effective July 1, 1990, designated the former section as
Subsection A; added Subsection B; and, in present Subsection A, substituted
"department, provided that, if the employee instructs the employer to withhold a greater
amount, the employer shall deduct and withhold the greater amount" for "bureau of
revenue" at the end of the first sentence, substituted "department" for "bureau" in the
second sentence, and substituted "one dollar ($1.00)" for "fifty cents ($.50)" in the fourth
sentence.

New Mexico may not tax income and gross receipts of Indians residing on
reservation when the income and gross receipts involved are derived solely from
activities within the reservation. Hunt v. O'Cheskey, 1973-NMCA-026, 85 N.M. 381, 512
P.2d 954, cert. quashed, 85 N.M. 388, 512 P.2d 961. See also case notes to 7-2-3
NMSA 1978.

Am. Jur. 2d, A.L.R. and C.J.S. references. — 71 Am. Jur. 2d State and Local
Taxation § 602.

85 C.J.S. Taxation §§ 1701 to 1705, 1721 to 1735.