Updated for tax year 2025.
If you live or work in New Mexico, you’ll likely need to file a New Mexico state income tax return along with your federal return. New Mexico uses a progressive income tax system with six brackets, so your filing status and taxable income affect how much state tax you owe.
This guide explains New Mexico’s 2025 income tax rates and brackets, standard deduction rules, available exemptions and credits, and updates for the current tax year. When you’re ready to file, TaxAct® automatically applies New Mexico’s tax rules to help you accurately prepare your New Mexico return alongside your federal return.
What is the New Mexico state income tax?
New Mexico state income tax is a tax on income earned by individuals. It is collected by the New Mexico Taxation and Revenue Department and helps fund state services.
For tax year 2025, New Mexico uses a six-bracket progressive tax structure with rates from 1.5% to 5.9%, depending on filing status and taxable income.
New Mexico income tax rates and tax brackets
New Mexico’s 2025 rate schedule is progressive. Here are the 2025 New Mexico income tax brackets:
| Tax Rate | Single Filers / Estates and Trusts | Married Filing Separately | Married Filing Jointly / Head of Household / Surviving Spouse |
|---|---|---|---|
| 1.5% | Up to $5,500 | Up to $4,000 | Up to $8,000 |
| 3.2% | $5,501-$16,500 | $4,001-$12,500 | $8,001-$25,000 |
| 4.3% | $16,501-$33,500 | $12,501-$25,000 | $25,001-$50,000 |
| 4.7% | $33,501-$66,500 | $25,001-$50,000 | $50,001-$100,000 |
| 4.9% | $66,501-$210,000 | $50,001-$157,500 | $100,001-$315,000 |
| 5.9% | Over $210,000 | Over $157,500 | Over $315,000 |
If you need more information on how federal tax brackets work, you can use our tax bracket calculator for federal taxes. See Form PIT-1 tax rate tables for official computation details.
New Mexico standard deduction
New Mexico generally uses the federal standard deduction or itemized deduction amount from your Form 1040 (line 12) on Form PIT-1. Because the federal standard deduction varies by filing status, your New Mexico deduction amount follows the same federal rules.
New Mexico also allows additional reductions, including a low- and middle-income tax exemption (PIT-1 line 14) for qualifying taxpayers and a $4,000 deduction for certain dependents (line 13) for head-of-household and married filing jointly filers. State and local income taxes paid are not deductible on your New Mexico return.
New Mexico exemptions and credits
New Mexico provides several exemptions, subtractions, and credits that can reduce your tax. Common examples include:
- Social Security exemption for qualifying taxpayers below income limits (single under $100,000; MFJ, surviving spouse, and HOH under $150,000; MFS under $75,000)
- Working Families Tax Credit of 25% of your federal earned income tax credit (EITC)
- Child Income Tax Credit, a refundable credit of $26 to $637 per qualifying child depending on adjusted gross income
- Child day care credit for qualifying caregivers
- Active-duty military pay subtraction and other Schedule PIT-ADJ adjustments
Eligibility rules vary by credit and subtraction. Review Form PIT-1 instructions and Schedule PIT-RC for current requirements.
New Mexico tax changes for 2025
New Mexico’s current six-bracket structure uses rates from 1.5% to 5.9%. The 2025 Form PIT-1 return is due April 15, 2026, with an automatic six-month filing extension available when qualifying federal extension requirements are met (extended due date October 15, 2026 for calendar-year filers).
FAQs
The bottom line
New Mexico’s 2025 income tax is progressive, with rates up to 5.9%. Understanding your bracket, deduction and exemption options, and available credits can help you better estimate your New Mexico tax bill or refund.
When you’re ready to file, TaxAct can help you prepare your federal and New Mexico returns in one place so you can file with confidence.
Already filed your taxes and waiting for your refund? Learn more about where your New Mexico state tax refund is.
This article is for informational purposes only and not legal or financial advice.
All TaxAct offers, products and services are subject to applicable terms and conditions.
The OBBB is now also being referred to by lawmakers as the Working Families Tax Cut Act. You may see one or both names used here, but they refer to the same set of tax changes.
Citations
New Mexico Taxation and Revenue Department. “Instructions for 2025 Form PIT-1.” Accessed 20 Aug. 2026.
New Mexico Taxation and Revenue Department. “Personal Income Tax Information Overview.” Accessed 20 Aug. 2026.
New Mexico Taxation and Revenue Department. “New Mexico Child Tax Credit.” Accessed 20 Aug. 2026.
New Mexico Taxation and Revenue Department. “Social Security Income Tax Exemption.” Accessed 20 Aug. 2026.