How to File Your New Mexico Tax Return for 2023: Step-by-Step Guide for Individuals and Small Businesses

Filing your New Mexico tax return for 2023 doesn’t have to be confusing or time-consuming. Whether you're an individual taxpayer, a sole proprietor, or a small business owner, this step-by-step guide will walk you through the process in plain language. We’ll explain what forms you need, how to file them, and what to expect from the New Mexico Taxation and Revenue Department. With a clear understanding of the requirements and resources, you can save time, reduce stress, and avoid common mistakes during the filing season.

New Mexico residents must file a state income tax return if they meet specific income thresholds, even if they've already filed a federal return with the IRS. Filing accurately and on time helps ensure you receive the largest refund you're entitled to—or avoid paying more than you legally owe. If you're unsure where to begin, this guide will help you figure out what documents to gather, how to navigate official tools like the Taxpayer Access Point (TAP), and when it’s best to consult a professional tax preparer or use trusted filing software.

This article is designed for anyone looking to file their state taxes with confidence and clarity. We've simplified the process into practical, easy-to-follow sections, with tips based on real-world scenarios, direct links to official forms, and answers to frequently asked questions. Whether you're filing for the first time or are a seasoned taxpayer keeping up with changes in 2023, this comprehensive guide will help you understand each step of the process and stay compliant with New Mexico’s tax laws.

Understanding New Mexico State Income Tax for 2023

New Mexico requires residents, part-year residents, and certain nonresidents to file a state income tax return. Whether you’re a salaried employee or operate a small business, your obligation to file depends on your income level, filing status, and sources of income. Even if you already submitted your federal tax return, you may still need to file a separate New Mexico tax return.

Who Needs to File

You must file a New Mexico tax return for 2023 if any of the following apply:

1. You are a full-year resident with gross income above the state’s minimum threshold.
   
   
2. You are a part-year resident and earn income while living in New Mexico.
   
   
3. You are a nonresident but received income from New Mexico sources, including wages or business income.
   
   
4. Your income meets or exceeds the minimum filing requirement, even if you don’t owe taxes.

The thresholds vary by filing status. For example, single filers under age 65 must file if their adjusted gross income exceeds $8,000, while married couples filing jointly must file if their combined income exceeds $16,000. These thresholds may change slightly from year to year.

Key Tax Changes for 2023

Taxpayers should be aware of several updates that may affect their 2023 return:

• Inflation-adjusted income tax brackets: New Mexico adjusted its tax brackets for inflation, which may affect the tax owed or refunded.
  
  
• Gross receipts tax adjustments: While this mainly affects businesses, changes in gross receipts tax rates may influence income reporting for small business owners.
  
  
• Expanded eligibility for certain credits: Child care and low-income household support credits have been revised. These may lower your total tax liability.

Always refer to the New Mexico Taxation and Revenue Department’s official updates for current information.

Important Deadlines

Missing tax deadlines can result in penalties and interest. Here are the dates to remember for the 2023 tax year:

• The filing deadline is April 15, 2024 (or the next business day if it falls on a weekend or holiday).
  
  
• Extension deadline: October 15, 2024, if you requested an extension on time.
  
  
• Payment deadline: Even if you file for an extension, payment is still due by April to avoid penalties.

The state may send a revenue department notification service alert if your return is late or incomplete. You should respond promptly to avoid further action.

If you're unsure whether you need to file or which deadline applies, it's best to contact a tax preparer or log into your account using the Taxpayer Access Point for clarification.

What Tax Forms Do You Need?

Filing your New Mexico tax return requires the correct forms based on your income sources and filing situation. Even if you've already filed a federal tax return, you'll still need to complete state-specific forms for New Mexico.

Primary Forms for Individual Filers

• PIT-1: This is the standard personal income tax form required for all New Mexico residents, part-year residents, and nonresidents who earned income there.
  
  
• You may also need to attach your federal tax return, especially if you claim deductions or credits relying on federal calculations.

Common Schedules and Credits

• PIT-CR: Use this schedule to claim tax credits, including the Low-Income Comprehensive Tax Rebate and child care credits.
  
  
• PIT-B: This form reports income from sole proprietorships and single-member LLCs in New Mexico.
  
  
• PIT-ADJ: Use this schedule to report allowable income govadjustments, such as contributions to qualified retirement accounts.
  
  
• RPD-41071: This form requests a filing extension with the state.

Where to Find Official Forms

All forms and instructions are available at https://www.tax.newmexico.gov. Be sure to use the latest versions and avoid unofficial websites.

Step-by-Step Instructions to Complete Your Return

Preparing your New Mexico tax return is easier when broken into clear steps. Below is a simplified guide to help you complete the process confidently and accurately.

Step 1: Gather Your Documents

• Collect your W-2s, 1099s, receipts, and statements from financial institutions to document your income and deductions.
  
  
• Include a copy of your federal tax return, which New Mexico may require for verification or credit claims.

Step 2: Complete PIT-1 and Required Schedules

• Fill out the PIT-1 form and attach any additional schedules relevant to your tax situation.
  
  
• Verify that income from employers or self-employment matches your records and reported totals.

Step 3: Calculate Deductions and Credits

• Review available deductions and credits to determine which ones apply to your return.
  
  
• Be accurate in your calculations to avoid overpaying or triggering a notice from the department.

Step 4: Review and Sign

• Double-check the return for math errors, incorrect Social Security numbers, or missing information.
  
  
• Make sure you sign the return; if filing jointly, both spouses must sign.

Step 5: Save Copies

• Retain copies of your completed return and supporting documents for several years.
  
  
• Keeping these on file helps resolve any issues if the Taxation and Revenue Department contacts you later.

Common Filing Mistakes to Avoid

• Submitting an unsigned return or omitting required schedules may delay processing.
  
  
• Using outdated forms or reporting incorrect figures could lead to penalties or refund delays.

How to File Your New Mexico Tax Return

After completing your forms, you must choose how to submit your return. New Mexico allows both electronic and paper filing, depending on your preference.

E-Filing Options

• Use the Taxpayer Access Point (TAP) at https://tap.state.nm.us to file your return online, check balances, or receive revenue department notification service alerts.
  
  
• You may also e-file through approved tax software or work with a tax preparer who submits on your behalf.

Paper Filing

• If mailing your return with a payment, send it to:
  New Mexico Taxation and Revenue Department, P.O. Box 25127, Santa Fe, NM 87504-5127.
  
  
• If mailing your return without a payment or refund due, use:
  P.O. Box 25122, Santa Fe, NM 87504-5122.
  
  
• Use the same address as those without payment for returns with a zero balance.

Choosing the Right Method

• E-filing is typically faster and more secure, and it helps you receive your refund sooner.
  
  
• If cost is a concern, free filing is available through approved software for qualifying taxpayers.

How to Make a Tax Payment in New Mexico

After you file your New Mexico tax return, you must pay any amount you owe by the deadline to avoid penalties and interest. The state offers multiple ways to make a secure payment, whether you file electronically or by mail.

Online Payment Options

You can pay your tax bill online using the Taxpayer Access Point (TAP). This is the most convenient way to pay directly through your account.

• Electronic Bank Transfer (ACH): You can transfer funds directly from your financial institution at no additional cost.
  
  
• Credit or Debit Card: TAP allows payments by card, although a small processing cost may apply.
  
  
• Payment Scheduling: TAP also allows you to schedule your payment in advance, which is helpful if you are filing early but want the funds withdrawn closer to the due date.

Always confirm that the payment was processed successfully and keep a copy of your confirmation for your records.

Mail-in Payments

If you file by mail, you can pay by check or money order. Make your check payable to the New Mexico Taxation and Revenue Department, and include your Social Security number and the tax year on the memo line.

• Be sure to include the payment voucher if required by the form instructions.
  
  
• Do not staple or attach the check directly to your tax return.
  
  
• Mail your payment to the correct address listed on the PIT-1 instructions.

Payment Deadlines and Penalties

Payment is due by April 15, 2024, even if you file for an extension. If you do not pay by the deadline, the department may charge penalties and daily interest on the unpaid amount.

If you cannot pay the full amount, you may still file on time and contact the department to request a payment plan. Partial payments are accepted, and acting quickly helps avoid further penalties.

Tracking Your Refund or Balance Due

After submitting your return, you can track your refund or check if you still owe money. New Mexico provides secure online tools for both.

How to Check Your Refund Status

Use the “Where’s My Refund?” tool on the Taxpayer Access Point (TAP) website to track your refund. You will need the following:

• Your Social Security number
  
  
• The exact amount of your expected refund
  
  
• Your tax year (2023)

Refunds are typically processed within six to eight weeks if you file by paper or within three weeks if you e-file. Delays may occur if your return is incomplete, inaccurate, or requires additional verification.

Checking Your Balance Due

If you still owe taxes, log in to your Taxpayer Access Point (TAP) account to view your current balance, payment history, and outstanding liabilities. The TAP portal provides a secure and convenient way to monitor your account in real time. In addition to reviewing balances, you can make payments, set up installment agreements if eligible, and download past notices or correspondence from the New Mexico Taxation and Revenue Department.

To stay informed, consider enrolling in the department’s notification service, which sends automatic alerts via email or text. These notifications can let you know if your balance is due, a refund has been processed, or if issues delay your return. Staying ahead of these updates can save you time and prevent surprises.

Regularly monitoring your account activity—especially during tax season—helps ensure you don’t miss important deadlines or communications. Being proactive with your payments and refunds keeps your account in good standing and reduces the risk of penalties, interest charges, or collection actions from the state.

Final Filing Checklist

Before submitting your return, use this checklist to ensure everything is complete and accurate. A thorough review helps avoid delays, rejections, or penalties from the Taxation and Revenue Department.

• You completed Form PIT-1 and included all required schedules.
  
  
• All income documents (such as W-2s, 1099s, and receipts) are attached or entered correctly.
  
  
• You reviewed and signed your return, and your spouse signed if filing jointly.
  
  
• All deductions and credits were calculated correctly based on your income and situation.
  
  
• Your tax payment was submitted, or your refund method was selected.
  
  
• The correct mailing address was used to submit a paper return.
  
  
• Copies of your return and supporting documents are saved for your records.
  
  
• You checked your TAP account to confirm your filing and payment status.

Completing this checklist ensures you’ve covered each step of the tax filing process in New Mexico for 2023. If you have questions or require clarification, don’t hesitate to contact the department or ask tax experts for assistance.

Frequently Asked Questions

Do I need to file a New Mexico tax return if I submitted a federal tax return?

You must file a separate New Mexico tax return even if you submitted a federal tax return to the IRS. The state requires its filing process to calculate income tax, deductions, and any amount you may owe. Access your Taxpayer Access Point account to complete and file your return. If you're unsure what forms to use, a tax preparer or expert can provide guidance.

How can I track my refund after filing?

After filing your New Mexico tax return, you can track your refund through the Taxpayer Access Point. You’ll need your Social Security number, refund amount, and tax year. Refunds are processed faster for electronic returns. To stay informed, sign up for the revenue department notification service. If your return has errors or is incomplete, the department may contact you for additional documents such as forms, receipts, or proof of income.

What documents do I need to prepare my tax return?

To prepare your New Mexico tax return, gather W-2s from your employer, 1099s, receipts for deductions, and your federal tax return. If you're self-employed, you may also need financial institution statements, gross receipts, and tax records. Having all income and expense documents organized helps you complete your return accurately. Keeping these items on file for several years is recommended, especially if you’re contacted by the department for account verification.

What if I can’t pay the full amount I owe?

If you owe more than you can pay, filing your return by the deadline is still essential. You can contact the department through the Taxpayer Access Point to request a payment plan. Making partial payments helps reduce interest and penalties. You can also get expert help from tax companies or preparers specializing in these situations. The revenue department notification service can alert you if additional actions are needed.

Can I file my taxes without using a tax preparer?

You can file your taxes if you’re comfortable with the process. Many people use free or affordable tax filing software to prepare and file their New Mexico tax return. The Taxpayer Access Point offers access to all required forms and account tools. If your return is simple, filing alone can reduce the cost. For more complex cases involving multiple income sources or deductions, expert help may be beneficial.

What deductions or credits can help lower my taxes?

You may qualify for deductions related to personal exemptions, retirement contributions, medical costs, or child care expenses. Credits can also reduce the total taxes you owe or increase your refund. Review all instructions for PIT-CR and related forms carefully. Use accurate income records and receipts from your employer or financial institution. A tax preparer can help determine which deductions apply. Filing with these in mind may lead to a max refund.

How do I know if I need to file a New Mexico tax return?

You must file a New Mexico tax return if your income meets the state’s filing threshold, even if you paid federal taxes. This applies to residents, part-year residents, and nonresidents with New Mexico income. Use the Taxpayer Access Point to check your account and determine your filing requirement. Contact the department directly or consult a tax preparer for simple questions about your return status if unsure.