New Mexico Releases Guidance for Application of Gross Receipts Tax to Lodging Marketplaces

A recent New Mexico bulletin advises taxpayers about the gross receipts tax responsibility of marketplace providers that list and book third party lodging and accommodations.

The state clarifies that their definition of marketplace provider applies to websites such as Expedia, Travelocity, AirBnB, and any other website that does third party booking for hotels or short term rentals, and that marketplaces with physical presence or which exceed the state economic nexus thresholds through their third party sales are required to register. Providers are required to remit gross receipt tax both on the accommodation and lodging sold through their website, and the proceeds from the services they provide to their marketplace sellers. The bulletin also clarifies that additional booking fees are included in the measure of gross receipts.

Marketplace sellers who provide New Mexico real property for rent are also required to file gross receipts tax returns. If rentals are made through a marketplace provider, the gross receipts must be reported, but may be deducted on the return, resulting in no tax paid. (New Mexico Bulletin B-200.37)

Posted on November 9, 2022