Stay up to date with sales tax: Join our mailing list!

The New Mexico Court of Appeals found that a taxpayer had sufficient nexus in the state and was subject to its gross receipts tax on its sales of computers via the Internet, mail, and telephone. The taxpayer argued that the sales did not take place in New Mexico and that title was transferred upon shipment from Dell’s facility in Texas. “Gross receipts” is defined as the total amount of money or the value of other consideration received from selling property in New Mexico. The Court concluded that the gross receipts tax was not limited to transactions based on transfer of title alone. Therefore, the taxpayer’s activities constituted taxable sales in New Mexico under the destination principle. (Dell Catalog Sales L.P. v. New Mexico Taxation and Revenue Department, New Mexico Court of Appeals, No. 26,843, June 3, 2008)


New Mexico has enacted legislation, effective July 1, 2007, creating the Advanced Energy Tax Credit which is available against the gross receipts tax, the compensating tax or the withholding tax. The credit may be claimed by a taxpayer who holds an interest in a solar thermal electric generating facility or a repowered coal electric generating facility that begins construction before December 31, 2015. The credit is for 6% of the eligible costs of the facility and may be carried forward for up to 5 years. The maximum credit per facility is $60 million. The facility must meet emission standards in order to qualify for the credit. If the facility fails to meet these standards, its eligibility will be revoked and repayment of the credit will be required. (S.B. 994, Laws 2007, Effective July 1, 2007)


New Mexico issued an interpretation of its annual sales tax holiday. For example, items normally sold as a unit cannot be priced separately and sold individually to qualify for exemption. Items bought with a rain check during the holiday period will be deductible if supported with a receipt. Further, layaway plans trigger a sale only when the last payment is made on the item and it is delivered to the customer. Additionally, exchanges made on items purchased tax exempt during the holiday are not subject to tax provided there is no charge for the exchanged item. Finally, purchases of items made on the internet delivered to a customer with a New Mexico billing and shipping address during the holiday are deductible. (Title 3, Chapter 2, Part 242)


Clothing and footwear less than $100. Computers less than $1000. Computer peripherals less than $500. School supplies. Does not include protective or athletic gear. Does not include watches, radios, phones, copiers, office equipment, office fixtures. See Details


Effective January 1, 2005, receipts for commercial contract services or Medicare part C services when received from a health care insurer or managed health care organization may be deducted from gross receipts as long as the services are within the scope of the licensed practitioner. Commercial contract services are defined as services which are performed according to a contract between the health care practitioner and the health care insurer or health care provider which are not included in services provided to Medicare or Medicaid patients. (New Mexico House Legislation, HB 625, effective as noted above)



Scroll to Top