us-nm/stat
NMSA 1978, § 7-2-11 — Tax credit; income allocation and apportionment
A.
Net income of any individual having income that is taxable both within and
without this state shall be apportioned and allocated as follows:
(1) during the first taxable year in which an individual incurs tax liability as a
resident, only income earned on or after the date the individual became a resident and,
in addition, income earned in New Mexico while a nonresident of New Mexico shall be
allocated to New Mexico;
(2) except as provided otherwise in Paragraph (1) of this subsection, income
other than compensation or gambling winnings shall be allocated and apportioned as
provided in the Uniform Division of Income for Tax Purposes Act [Chapter 7, Article 4
NMSA 1978], but if the income is not allocated or apportioned by that act, then it may be
allocated or apportioned in accordance with instructions, rulings or regulations of the
secretary;
(3) except as provided otherwise in Paragraph (1) of this subsection,
compensation and gambling winnings of a resident taxpayer shall be allocated to this
state;
(4) compensation of a nonresident taxpayer shall be allocated to this state to
the extent that such compensation is for activities, labor or personal services within this
state; provided that the compensation may be allocated to the taxpayer's state of
residence:
(a) if the activities, labor or services are performed in this state for fifteen or
fewer days during the taxpayer's taxable year;
(b) if the compensation is for activities, labor or services performed for a
business in the manufacturing industry in New Mexico that is located within twenty miles
of an international border, that has a minimum of five full-time employees who are New
Mexico residents, that is not receiving development training funds under Section 21-19-
7 NMSA 1978 and that meets the qualifications of one of Items 1) through 4) of this
subparagraph: 1) the business had no payroll in New Mexico during the previous
calendar year; 2) the business had a payroll in New Mexico for less than the entire
previous calendar year, and the first payroll of the new calendar year includes payments
to New Mexico residents exceeding the highest monthly payroll for such residents in the
previous calendar year; 3) the business had a payroll in New Mexico for the entire
previous calendar year, and the first payroll of the new calendar year includes payments
to New Mexico residents exceeding by at least ten percent both the payroll for all
employees in January 2001 and the payroll for New Mexico residents twelve months
prior to the commencement of the new calendar year; or 4) the business had a payroll in
New Mexico for the entire previous calendar year, but had no payroll in New Mexico
within one year prior to January 1, 2001, and the first payroll of the new calendar year
includes payments to New Mexico residents exceeding by at least ten percent the
payroll for such residents twelve months earlier; or
(c) if the activities, labor or services are performed in this state for disaster- or
emergency-related critical infrastructure work in response to a declared state disaster or
emergency during a disaster response period, as defined in the Tax Administration Act
[Chapter 7, Article 1 NMSA 1978];
(5) gambling winnings of a nonresident shall be allocated to this state if the
gambling winnings arose from a source within this state; and
(6) other deductions and exemptions allowable in computing net income and
not specifically allocated in the Uniform Division of Income for Tax Purposes Act shall
be equitably allocated or apportioned in accordance with instructions, rulings or
regulations of the secretary.
B.
For the purposes of this section, "non-New Mexico percentage" means the
percentage determined by dividing the difference between the taxpayer's net income
and the sum of the amounts allocated or apportioned to New Mexico by that net income.
C.
A taxpayer may claim a credit in an amount equal to the amount of tax
determined to be due under Section 7-2-7 or 7-2-7.1 NMSA 1978 multiplied by the non-
New Mexico percentage.
Source: official text