Filing your 2016 New Mexico personal income tax return is required if you are a resident of New Mexico, a part-year resident, or a nonresident with income sourced in New Mexico, and you meet federal filing requirements. Even if you are not strictly required to file, you may submit a return to claim refunds, rebates, or credits—such as the Working Families Tax Credit or other state incentives—that can reduce your overall New Mexico income tax liability.
The deadlines for the 2016 tax year are April 18, 2017, for paper returns; May 1, 2017, for electronically filed returns accompanied by payment; and October 16, 2017, if you obtained a federal extension. Missing these dates can result in penalties and interest charges, so paying and filing—or paying—by the appropriate due date is essential.
This guide is based on official guidance from the New Mexico Taxation and Revenue Department and reflects the statutes, forms, and procedures in effect for the 2016 tax year. Following these step-by-step instructions, you can confidently navigate the personal income tax process and ensure compliance with state tax regulations.
Overview of New Mexico Income Tax for 2016
Who Needs to File
Filing a New Mexico return ensures compliance with state income tax regulations and allows you to claim any refunds, rebates, or credits you may be eligible for.
- Full-Year Residents: Must file if they meet federal filing requirements or wish to claim New Mexico credits and rebates, ensuring their income tax obligations are met.
- Part-Year Residents: Must file if they lived in New Mexico for any portion of 2016 and either meet federal thresholds or want to claim state credits for income earned in the state.
- Nonresidents with NM Income: Must file if they have New Mexico–source income and meet federal filing thresholds, allowing the state to collect taxes on income earned within its borders.
- Optional Filers: You may choose to file even if you are below thresholds to recover state tax withheld, qualify for the Working Families Tax Credit, or access other refundable credits.
Federal Income Tax vs. State Tax Filing Thresholds
New Mexico adopts federal income thresholds to determine filing requirements, simplifying the process for taxpayers familiar with their federal obligations.
- Thresholds by Status: For 2016, thresholds ranged from $10,350 for single filers under 65 to $23,200 for married couples filing jointly with both spouses over 65.
- State Conformity: Since New Mexico conforms to federal brackets, you must file a state return if your adjusted gross income plus any New Mexico additions exceeds the federal filing status and age threshold.
Key Changes for Tax Year 2016
Several updates impacted the 2016 filing process and available credits, reflecting new state policies and conformance with federal rules.
- Due Date Alignment: Paper returns were due April 18, 2017, and e-filed returns with payment enjoyed an extended May 1, 2017, matching federal dates and simplifying taxpayer deadlines.
- Veterans’ Fund Renaming: The “Veterans’ National Cemetery Fund” became the “Veterans’ State Cemetery Fund,” clarifying where voluntary contributions are directed.
- Disaster Response Exemptions: Introduced temporary exemptions for nonresident emergency responders, allowing qualifying disaster-response income to be excluded from taxable income.
- Working Families Tax Credit: Continued as a refundable credit equal to 10% of the federal Earned Income Tax Credit, supporting low- and middle-income households with additional state relief.
What Forms to Use
Main Individual Return: PIT-1
The PIT-1 is the primary form for reporting New Mexico personal income tax and must be completed by every taxpayer, whether you file on paper or electronically. You can download the official PIT-1 form from the New Mexico Taxation and Revenue Department website.
- PIT-1 Download: Visit the Taxation and Revenue Department’s website at tax.newmexico.gov to access the PIT-1 form and instructions, ensuring you use the official state-approved documents.
- Purpose of PIT-1: This form captures your adjusted gross income, exemptions, deductions, and credits, and calculates your state tax liability or refund, making it the cornerstone of your New Mexico return.
Common Schedules & Attachments
Depending on your filing situation, you may need to attach additional schedules to report adjustments, credits, and income allocations correctly. Failing to include the required attachments can delay processing or result in an incomplete return.
- PIT-ADJ: Use this schedule to report additions or subtractions to your federal adjusted gross income, which helps reconcile differences between federal and New Mexico income definitions.
- PIT-RC: Claim rebates and credits—such as the Working Families Tax Credit—using this schedule to reduce your overall tax liability and potentially receive a refund.
- PIT-B: Allocate income for part-year or nonresident filers who earned income within and outside New Mexico, ensuring accurate apportionment of taxable income.
- PIT-CR: Report business-related tax credits on this schedule if you qualify for incentives like the High-Wage Jobs Tax Credit or other corporate credits.
- PIT-D: Use this schedule to voluntarily contribute to approved state programs, such as the Veterans’ State Cemetery Fund or the New Mexico Military Institute Scholarship Fund.
- PIT-S: If you have more than five dependents, attach this supplemental schedule, which provides space to list additional dependent information beyond the main form’s capacity.
Forms for Small Businesses
Sole proprietors and small business owners must include federal and state business income details to ensure proper reporting and compliance with New Mexico’s gross receipts tax requirements.
- Federal Schedule C: Report profit or loss from your sole proprietorship on IRS Schedule C, then attach a copy to your New Mexico return to substantiate your business income.
- CRS-1: File the Combined Reporting System Return for gross receipts tax, compensating tax, and withholding tax if you registered for business taxes in New Mexico, meeting state reporting requirements.
Payment Vouchers
If you owe tax when you file or need to make estimated payments, using the correct voucher ensures your payment is credited correctly.
- PIT-PV: Attach this voucher when submitting a balance due with your return by check or money order. This will help the department apply your payment to your account.
- PIT-EXT: Include this voucher with your extension request if you file Form 4868 federally but still need to prepay estimated tax to avoid late-payment penalties.
- PIT-ES: If you expect to owe $1,000 or more in 2017, use this voucher for quarterly estimated tax payments to maintain compliance with estimated payment requirements.
Accessing Official Forms
Ensure you always use official state-approved forms to avoid processing delays or rejections.
- Online Access: Download every form and schedule at tax.newmexico.gov, guaranteeing you use the latest 2016 versions.
- By Phone: Call (505) 827-2206 to request mailed copies, which can be helpful if you lack reliable internet access.
- In Person: Visit any local district tax office to pick up forms and ask staff questions about your filing, ensuring you have all necessary documents before you begin.
Step-by-Step Instructions to Complete Your Return
Step 1: Gather Required Documents
Before completing your return, assemble every document to accurately report income, deductions, and credits to the New Mexico Taxation and Revenue Department.
- Federal Tax Return: Have your completed Form 1040, 1040A, or 1040EZ available to reference adjusted gross income, filing status, and exemptions.
- W-2 Forms: Gather all W-2s to report wages and withholdings, ensuring the department can verify income and tax payments.
- 1099 Forms: Collect 1099-INT, 1099-DIV, or 1099-MISC statements to accurately report interest, dividends, and miscellaneous income for your state return.
- Deduction and Credit Documentation: Organize records for itemized deductions, medical expenses, or credits like the Working Families Tax Credit to support any tax-saving claims.
- Social Security Numbers: Confirm SSNs or ITINs for yourself, your spouse (if filing jointly), and any dependents to avoid processing delays.
- Prior Year’s NM Return: If available, keep last year’s PIT-1 return on hand for reference to carry forward amounts or review previous state-specific entries.
Step 2: Complete the PIT-1 Form
With your documents in place, you’ll complete the PIT-1 to report personal information, income, deductions, and credits. Follow each section in order:
- Lines 1–4: Personal Information: Please provide your name, mailing address, Social Security Number, and residency status (resident, part-year, or nonresident) so the Department can correctly process your taxpayer profile.
- Lines 5–8: Filing Status & Exemptions: Select the filing status that matches your federal return and list the number of exemptions claimed, including spouse and dependents, to calculate exemption allowances.
- Lines 9–11: Income Calculation: Transfer your federal adjusted gross income from Form 1040, then report any New Mexico additions or subtractions from Schedule PIT-ADJ to determine your state taxable income.
- Lines 12–16: Deductions & Exemptions: Indicate your federal standard or itemized deduction, apply any New Mexico low- and middle-income exemption, and include qualifying medical care expense deductions for 2016.
- Lines 17–23: Tax Liability & Credits: Use the state tax tables to compute your New Mexico income tax, subtract credits from Schedule PIT-RC and PIT-CR, and arrive at your net tax due.
- Lines 24–42: Payments & Refunds: Report state tax withheld, estimated payments, and other credits; calculate whether you owe additional tax or have an overpayment, then choose to receive a refund or apply it to next year.
Step 3: Calculate Penalties, Interest, and Choose Payment Options
If you owe a balance, you must pay by April 18, 2017 (or May 1, 2017, if e-filing and e-paying) to avoid penalties and interest.
- Late-Payment Penalty: 2% per month (or partial month) on the unpaid tax balance, up to 20%. Paying even a partial amount limits penalty accrual.
- Interest Charges: Accrue daily at the state’s statutory rate, so the sooner you pay, the less total interest you incur.
- Payment Methods:
- Electronic: For secure, immediate credit, you can use an e-check (no fee) or a credit/debit card (2.40% convenience fee) via Taxpayer Access Point (TAP)
- Paper: Check or money order with Form PIT-PV, payable to “New Mexico Taxation and Revenue Department,” including your SSN and “PIT-1 2016.”
- Payment Plan: If you cannot pay in full, file your return on time and contact the Department to set up an installment agreement, reducing further penalties.
Step 4: Avoid Common Mistakes
Prevent processing delays and potential notices by steering clear of these frequent errors:
- Unsigned Return: Always sign and date your PIT-1; unsigned returns are considered incomplete and can be rejected.
- Missing Attachments: Attach all required schedules (PIT-ADJ, PIT-RC, PIT-B, etc.) and W-2/1099 forms to substantiate income, deductions, and credits.
- Math Errors: Double-check all calculations or use e-file software to reduce arithmetic mistakes that can trigger department inquiries.
- Incorrect Tables: Ensure you use the 2016 New Mexico tax rate tables—federal tables or outdated versions will lead to inaccurate tax liability.
- Payment Oversights: If tax is due, include payment or voucher; forgetting payment can result in failure-to-file and failure-to-pay penalties.
Step 5: Special Instructions for Small Businesses
Sole proprietors and business owners must take additional steps to report business income and satisfy gross receipts tax obligations:
- Report Business Income: Attach a copy of your federal Schedule C to report profit or loss, ensuring state income aligns with federal filings.
- Allocate Multistate Income: Use Schedule PIT-B if you earned income inside and outside New Mexico to apportion taxable income correctly.
- Claim Business Credits: Complete Schedule PIT-CR for state business-related tax credits, like the High-Wage Jobs Tax Credit, reducing your overall liability.
- Gross Receipts Tax Return: File Form CRS-1 for GRT, compensating tax, and withholding tax according to your filing frequency (monthly, quarterly, or semi-annually).
By following these clear, ordered steps—each with the required documentation and schedules—you’ll efficiently complete your 2016 New Mexico personal income tax return and satisfy your state income tax obligations.
How to File Your Return
Electronic Filing Options
Electronic filing through the Taxpayer Access Point (TAP) is the Department’s preferred method, offering speed, accuracy, and convenience.
- Taxpayer Access Point (TAP): Use TAP at tap.state.nm.us to securely e-file your PIT-1 and related schedules, reducing errors through built-in checks and receiving instant confirmation from the revenue department.
- Commercial Software: Many tax preparation packages include New Mexico forms; choose IRS-approved software that supports state returns to benefit from guided entry and automatic calculations.
- Tax Professionals: Certified preparers can file electronically on your behalf and manage any revenue department notification service alerts, ensuring you meet all filing requirements.
Paper Filing Guidelines
Following the Department’s specifications will minimize processing delays if you elect to file a paper return.
- Official Forms Only: Complete the 2016 PIT-1 and all attachments in black or blue ink; handwritten or printed substitute forms are unacceptable.
- Required Attachments: Securely attach W-2s, 1099s, payment vouchers, and schedules like PIT-ADJ and PIT-RC to substantiate income, deductions, and credits.
- Mailing Addresses:
With refund returns, send to:
NM Taxation and Revenue Dept.,
P.O. Box 25122,
Santa Fe, NM 87504-5122.
With payments due, send to:
NM Taxation and Revenue Dept.,
P.O. Box 8390,
Santa Fe, NM 87504-8390.
Processing Times & Confirmation
Understanding typical turnaround times helps set expectations for refunds and notices.
- E-File Processing: Returns filed electronically are generally processed within 2–4 weeks, and refunds are issued more quickly via direct deposit.
- Paper Processing: Paper returns received early in the season take 6–8 weeks to process; returns filed after March 15 may take up to 12 weeks.
- Confirmation: E-filers receive immediate acknowledgment through TAP, while paper filers should allow sufficient mailing time and consider certified mail for tracking.
How to Make a Payment
Electronic Payment Methods
You can pay your 2016 tax liability online through the Taxpayer Access Point (TAP), which accepts e-checks without a fee and credit or debit card payments with a 2.40 percent convenience charge. For streamlined processing, business taxpayers registered for electronic funds transfer can also remit gross receipts, withholding taxes, and personal income payments.
Paper Payment Methods
If you prefer a paper remittance, prepare a check or money order payable to “New Mexico Taxation and Revenue Department.” Include Form PIT-PV, and write your Social Security number, “PIT-1,” and “2016” on the payment to ensure it is correctly applied. Mail your payment to the department’s payment address for balances due.
Deadlines, Penalties & Interest
All payments must arrive by April 18, 2017—or by May 1, 2017, if you both file and pay electronically—to avoid a late-payment penalty of 2 percent per month on the unpaid balance and daily interest at the state’s statutory rate. Paying even part of your balance by the due date limits additional penalties.
Payment Plans & Estimated Payments
If you cannot pay in full, file your return on time and contact the Taxation and Revenue Department to request an installment agreement, which spreads your balance due over monthly payments and caps further penalties. For taxpayers expecting to owe $1,000 or more in 2017, make quarterly estimated payments using Form PIT-ES by April 15, June 15, September 15, 2017, and January 15, 2018, to avoid underpayment penalties.
How to Track Your Refund or Balance Due
Checking Your Refund Status
You can monitor your refund online via the Taxpayer Access Point (TAP) by selecting “Where Is My Refund?” and entering your Social Security number and amount to view real-time status updates. Alternatively, call the Department’s automated line at (866) 285-2996 (option 3) or Santa Fe at (505) 827-0827, having your return information handy for verification.
Expected Processing Times
Electronic returns typically process within 2–4 weeks, with direct deposit refunds arriving fastest, while paper returns mailed before mid-March generally take 6–8 weeks and can extend to 12 weeks if filed later. These timelines assume complete and accurate filings; any discrepancies can add additional review time.
Viewing & Paying a Balance Due
To check and pay any balance owing, log into TAP and review your account ledger, which displays outstanding amounts, penalties, and interest. You may pay electronically via e-check or card, or print a payment voucher (PIT-PV) to mail with your check or money order if you prefer paper remittance.
Common Causes of Delays
Refunds and balances may be delayed by incomplete returns, missing signatures, omitted attachments (such as W-2s or schedules), or selections for additional review due to credit or deduction claims. Ensuring your return is fully signed, all forms are attached, and payments are accurate minimizes processing setbacks.
Final Filing Checklist
- Verify Forms Completed: Ensure every line of your PIT-1 is filled out accurately, including personal information, income calculations, and credit entries. This guarantees the department can process your return without requesting corrections and helps avoid revenue department notification service alerts.
- Attach Required Documents: Include all W-2s, 1099s, schedules (PIT-ADJ, PIT-RC, PIT-B, etc.), and payment vouchers with your return. Attaching complete documentation supports your claims for deductions, credits, or estimated payments and prevents processing delays.
- Sign & Date Your Return: Sign and date the PIT-1 on the designated signature line; joint filers must both sign. An unsigned return is considered incomplete and can be rejected, resulting in missed deadlines and possible penalties.
- Confirm Payment or Refund Election: If you owe tax, include your payment or PIT-PV voucher; if you expect a refund, choose direct deposit for faster processing. Verifying your payment method or refund option prevents misapplied funds and accelerates your refund timeline.
- Maintain Copies for Your Records: Keep a complete copy of your filed return, attachments, and proof of payment or e-file confirmation for at least seven years. Retaining these records helps during an audit, amendment, or future reference to your income tax responsibilities in New Mexico.
Frequently Asked Questions
What if I missed the filing deadline?
If you missed the April 18, 2017, deadline, file your return as soon as possible to limit failure-to-file penalties of 2 percent per month on your income tax balance. The New Mexico Taxation and Revenue Department may waive penalties for reasonable cause, but interest continues to accrue daily. Filing late also risks missing out on refunds you may be owed.
Can I e-file for free?
Yes. You can file your 2016 New Mexico return for free using the Taxpayer Access Point (TAP) on the state’s taxation and revenue department website. TAP allows you to submit your PIT-1, schedules, and payment vouchers electronically without charge. Many taxpayers also qualify for free federal e-filing through IRS Free File providers that support New Mexico forms.
Which deductions do New Mexico taxpayers often miss?
Taxpayers frequently overlook the refundable medical care credit and the Working Families Tax Credit on their PIT-1. The medical care credit applies to unreimbursed, uncompensated expenses, while the Working Families Tax Credit equals 10 percent of your federal Earned Income Tax Credit. Claiming both can lower your state tax liability or generate a refund when filing New Mexico taxes.
How do I request an extension?
New Mexico automatically recognizes federal extensions filed via IRS Form 4868 by April 18, 2017. This grants you until October 16, 2017, to file your PIT-1. Remember, an extension to the file does not extend the time to pay. Use Form PIT-EXT or pay electronically through TAP by the original due date to avoid failure-to-pay penalties and interest.
Can I file jointly if I moved mid-year?
Yes. If you and your spouse file a joint federal return, you should also file a joint New Mexico return, even if one spouse lived out of state for part of 2016. Use Schedule PIT-B to allocate income between New Mexico and other states, ensuring accurate apportionment for gross receipts tax and income tax exemption calculations.
What if I have income from other states?
Nonresidents and part-year residents with income from New Mexico and other states must complete Schedule PIT-B to apportion taxable income correctly. You may also claim a credit on your PIT-1 for taxes paid to other states. Proper allocation prevents double taxation and ensures compliance with New Mexico’s income tax regulations.
How do I amend my New Mexico return if I made an error?
To correct errors, file Form PIT-X, the amended personal income tax return, with the New Mexico Taxation and Revenue Department. Attach any revised schedules (PIT-ADJ, PIT-RC) and an explanation of changes. Pay any additional tax, interest, and penalties promptly through TAP or with a PIT-PV voucher to minimize further charges.
