How does New Mexico tax remote workers?

There are a few situations to consider. You may fall into more than one category.

1. I lived in New Mexico.
• If you're considered a full-year or part-year resident of New Mexico, you'll be taxed on all income earned from any source during your time of residency. Be sure to file the appropriate return.
2. I worked remotely from New Mexico.
• New Mexico taxes income earned for personal services performed while in New Mexico (even if you're a nonresident). This includes remote work for an employer or clients based outside New Mexico if you were physically in the state while doing the work.
• You may be able to claim a credit for taxes paid to another state on your resident return for any income required to be reported in multiple states.
3. My employer was based in New Mexico.
• If you lived in another state and worked remotely for an employer based in New Mexico and you did not physically work at any time in New Mexico, your employer will not be required to withhold any New Mexico income taxes on your W-2. If they do withhold New Mexico taxes, you will likely want to file a New Mexico return to be refunded the tax which was withheld.
• If you are a New Mexico nonresident, you did not physically work in New Mexico, and your employer did not withhold New Mexico state taxes, you probably don't need to file a New Mexico return at all unless you otherwise have a New Mexico filing requirement.

If your New Mexico taxable wages were minimal and you didn't do any other business in New Mexico, it's possible you'll be exempt from filing regardless of residency. See the New Mexico PIT-1 instructions for more information.