What is New Mexico Tax Rate?
New Mexico, known for its diverse landscapes ranging from deserts to mountains, has a unique tax system that varies depending on the type of income and the county in which you reside. Understanding the New Mexico tax rate is crucial for both residents and non-residents who earn income in the state. This article will provide an overview of the tax rates in New Mexico, including state income tax, sales tax, and property tax.
State Income Tax Rate in New Mexico
New Mexico levies a state income tax on both residents and non-residents who earn income within the state. The tax rate ranges from 1.7% to 4.9% of taxable income, depending on the taxpayer’s filing status and income level. The rates are progressive, meaning that the higher your income, the higher the tax rate you will pay. For example, individuals with a taxable income of $15,000 or less pay a 1.7% tax rate, while those with taxable income over $500,000 pay a 4.9% rate.
Sales Tax Rate in New Mexico
New Mexico has one of the highest sales tax rates in the United States, with a standard rate of 5.3125%. However, this rate can vary depending on the county and the type of goods or services purchased. In addition to the state sales tax, local governments may impose their own sales tax, which can raise the total sales tax rate to as high as 8.875% in some areas. For instance, Santa Fe County has a combined sales tax rate of 7.375%, while Bernalillo County has a rate of 8.875%.
Property Tax Rate in New Mexico
Property tax in New Mexico is based on the assessed value of the property, which is typically determined by the county assessor. The tax rate is calculated by dividing the property tax levy by the total assessed value of all taxable property in the county. The property tax rate can vary widely from one county to another, with some counties having higher rates than others. For example, in Santa Fe County, the property tax rate is approximately $0.36 per $100 of assessed value, while in Bernalillo County, it is around $0.34 per $100.
Conclusion
Understanding the New Mexico tax rate is essential for anyone earning income in the state. By knowing the state income tax rate, sales tax rate, and property tax rate, individuals and businesses can better plan their finances and comply with state tax regulations. Keep in mind that tax laws and rates are subject to change, so it’s always a good idea to consult with a tax professional or the New Mexico Taxation and Revenue Department for the most up-to-date information.
