New Mexico State Tax Rulings
Free plain-English summaries of state tax letter rulings and advisory opinions issued in New Mexico, with full citations and the original source on every page.
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Could a home-health agency deduct federal EEOICPA payments because its patients were Medicare beneficiaries, or exclude services involving Navajo Nation members?
No. Four Corners Healthcare received its payments from the U.S. Department of Labor under the Energy Employees Occupational Illness Compensation Program Act, not under Medicare Title 18. Section 7-9-7…
Did listing a New Mexico home address on Schedule C make an Ohio tea shop's sales subject to New Mexico gross receipts tax?
No. Bruce Winchell proved with Ohio registration, sales-tax returns, location evidence, and credible testimony that At Portage Lakes, LLC operated entirely in Akron and earned all 2014 sales there. Th…
Were oil-and-gas title research and lease-acquisition receipts taxable merely because the prospects involved New Mexico land?
No. Continental Land Resources proved that its products were title reports, leases, or lease-acquisition efforts—not merely the management of landmen—and that out-of-state clients received and first u…
Could an independent-living community use after-the-fact cost and market studies to increase the real-property rental deduction from its bundled resident charges?
No. Gemini Las Colinas was entitled to deduct the part of its receipts derived from leasing real property, but it did not prove that the Department incorrectly calculated that part from the available …
Could a New Mexico rancher prove that his 2011–2013 livestock sales and ranch services were exempt from gross receipts tax using reconstructed memories and affidavits instead of business records?
Only partly. Dusty Stone credibly testified that he sold livestock and performed ranch services, but his reconstructed calendars, memories, customer conversations, and yearly affidavits did not docume…
Could three New Mexico RV-storage facilities deduct receipts from assigned open-air and overhead-covered parking spaces as leases of real property?
No, but the penalties were abated. Even though customers received assigned spaces under month-to-month contracts and had round-the-clock gated access, the open-air and overhead-covered spaces lacked p…
Could two UNM sports-marketing affiliates reduce their New Mexico tax assessments for trademark sublicenses, national radio advertising, bad debts, or a supposedly mailed pass-through payment?
No. Lobo Sports Properties and Iceberg Ventures did not prove that sponsorship receipts came from sublicensing UNM trademarks, reliably identify qualifying national radio-advertising receipts, or docu…
Could a New Mexico salon deduct its independent contractors' weekly booth and room payments as receipts from leases of real property?
No. Solutions Salon did not prove that it surrendered exclusive dominion and control over its booths and rooms. Contractors could use assigned spaces only for salon services, generally only during bus…
Could a physical-therapy practice seek administrative costs and professional fees in a new refund claim after receiving its tax refund and unconditionally withdrawing the original protest?
No. Rio Rancho Physical Therapy received its full gross receipts tax refund plus interest, then unconditionally withdrew the protest without requesting or reserving administrative costs and profession…
Did a Texas wooden-pallet manufacturer owe New Mexico gross receipts tax when New Mexico business customers traveled to its Texas location and picked up the pallets there?
No. Eduardo Aguirre lived, worked, manufactured wooden pallets, and completed customer sales at his Texas business. His New Mexico customers traveled to that location and picked up their pallets; his …
Can an affiliated hotel-management company use a percentage of each hotel's revenue to allocate its costs and still deduct the fees as services provided on a nonprofit or cost basis?
Yes. Total Management Systems provided administrative, managerial, accounting, and customer services to family-owned affiliate hotels. Section 7-9-69 did not require one cost-allocation formula, and t…
Did a California teleradiology company prove that stipends and cash collection guarantees from New Mexico hospitals were nontaxable compensation only for out-of-state availability?
No. Online Radiology argued that hospital stipends compensated it for after-hours availability and remote reads performed outside New Mexico, but its contracts also tied the payments to medical direct…
Were two men who continued a New Mexico towing business after its corporate certificate was canceled personally liable for gross receipts tax collected but not reported or remitted?
Yes. Prestige Towing & Recovery's 1997 corporate certificate was canceled on August 7, 2007, but Gabriel and Elauterio Vigil continued the business until a new corporation was formed on September 21, …
Did pre-assessment objections and later emails to New Mexico tax employees preserve a business's right to contest 2016 and 2017 gross receipts tax assessments after the 90-day protest deadlines?
No. Corwin Research & Investigations had until July 19, 2016 and November 30, 2017 to protest two assessments, but Michael Corwin's first formal protest was mailed September 21, 2018. Earlier emails w…
Could New Mexico levy a wife's individually titled IRA to collect gross receipts tax arising from her husband's business when she did not operate the business and was never assessed?
No. Michele Giacomo was a nurse who did not participate in her husband's medical-equipment business, was not assessed, had no collection responsibility, and had not agreed to assume the tax. Joint inc…
Could Sandia deduct gross receipts from scientific, engineering, custom-software, and classified services sold to federal agencies when the specific work products were delivered and first used outside New Mexico?
Yes. Section 7-9-57 applied to services sold to federal agencies just as it applied to other out-of-state buyers; Section 7-9-54's exclusion of governmental services from its own deduction did not eli…
Could a New Mexico business recover gross receipts tax overpayments discovered during audits when its refund filings and later challenges missed statutory deadlines?
No. Inner Works discovered that it had overpaid gross receipts tax by failing to deduct qualifying sales of services to out-of-state purchasers. Its July 2015 claim for 2009 qualified for a special on…
Could a New Mexico contractor avoid gross receipts tax penalty and interest because its customer said a direct-pay certificate made the customer responsible for the tax?
No. Apple Electrical Contractors stopped billing and paying New Mexico gross receipts tax after a major customer said it had a New Mexico direct-pay certificate and paid the tax itself. The customer n…
Could Halliburton deduct gross receipts from hydraulic-fracturing chemicals as sales of chemicals in lots over 18 tons?
No. Halliburton used the products while performing hydraulic-fracturing services; it did not sell them to well operators merely because contracts discussed goods or invoices stated product amounts sep…
Were receipts from DEA hazardous-material cleanup jobs in New Mexico deductible because DEA headquarters and the final disposal facilities were outside the state?
No. Advanced Environmental Solutions identified, packaged, labeled, removed, and temporarily stored hazardous materials from DEA-authorized sites, mostly in New Mexico. Although DEA headquarters appro…
Were a medical staffing company's New Mexico receipts excluded as disclosed-agent reimbursements or deductible as health-care services?
No. Ready Tech-Go employed and paid medical professionals, contracted with New Mexico facilities as an independent contractor, billed one hourly rate, and kept the difference between that rate and emp…
Was a court reporter personally liable for a sole proprietorship's gross receipts tax after forming an LLC but failing to update the New Mexico tax registration?
Yes. Ana Koeblitz formed New Mexico Depo, LLC in January 2012, but the business continued using the sole proprietorship's CRS account and did not register the LLC with the Department until 2018. Exter…
Were five related New Mexico food and restaurant businesses liable for penalties when their trained tax employee had emergency surgery, never returned, and the controller filed one day late upon returning from vacation?
No penalties were due. The accounting assistant responsible for the five entities' monthly gross receipts tax filings underwent unexpected emergency surgery while the controller was away, never return…
Were Schedule K-1 guaranteed payments to owners of New Mexico partnership-taxed LLCs subject to gross receipts tax when the owners acted as partners on behalf of the businesses?
No. Thomas and Linda Krumland received $2,508,534 of Schedule K-1 guaranteed payments from partnership-taxed LLCs they owned. Although federal Section 707(c) treats guaranteed payments as compensation…
Could a New Mexico USPS mail contractor deduct all receipts from routes that crossed into Texas, or was the interstate-commerce deduction limited by scheduled delivery points?
The deduction was limited to 17%, not 100%. Diamond T's trucks crossed between Texas and New Mexico, but its schedule also included extensive New Mexico stops and entirely intrastate trips. Applying t…
Could a corporate provider of New Mexico Medicaid developmental-disability services exclude state payments from gross receipts as a disclosed agent or under caregiver exclusions for individuals?
No. Active Solutions' Family Living Services receipts were payments for its own contractual services, not reimbursements received solely as a disclosed agent of the state or its direct-care contractor…
Were consulting fees taxable as New Mexico gross receipts when Colorado businesses performed every service by phone and internet from Colorado for New Mexico clients?
No. Michael and Meredith Hartnagle's Colorado businesses performed all consulting services for two New Mexico clients from Colorado by telephone and internet, without traveling to New Mexico. Although…
Could a New Mexico bicycle shop recover late-return penalties after it made monthly gross receipts tax payments but failed to file separate returns because it followed Department help-line guidance?
Yes. High Desert Bicycles made monthly gross receipts tax payments through the Department's online system but did not realize that filing a return was a separate step. The AHO credited its treasurer's…
Could a New Mexico contractor obtain a refund of gross receipts tax penalty and interest when an employee unintentionally paid one day late while the office was short-staffed?
No. El Terrero Construction's assistant office manager believed the December 2017 gross receipts tax had been paid on time but later discovered that the deadline was missed by one day while the office…
Were CCA's receipts for housing county and federal inmates deductible as licenses sold to Torrance County for resale to the U.S. Marshals Service?
No. CCA's contracts required incarceration, custody, records, transportation, medical care, meals, utilities, maintenance, guards, and other detention services; they did not sell or resell licenses to…
Could JTC deduct receipts from coating and blasting services without valid New Mexico nontaxable transaction certificates?
Mostly no. JTC performed coating and blasting services but lacked valid New Mexico NTTCs from Mid Columbia Engineering, ABQ Manufacturing, and other buyers. An incomplete Washington resale certificate…
Could an assisted-living facility calculate its deductible real-property rent by subtracting service costs from bundled resident charges without proving fair rental value?
No. SSC was entitled to deduct receipts attributable to leasing real property, but it had to use a reasonable method to separate rent from taxable assisted-living services. SSC subtracted its costs fo…
Were Del Corazon Hospice's Medicaid receipts for nursing-home room and board excluded from gross receipts as amounts received solely for disclosed principals?
No. Del Corazon was contractually responsible for paying nursing homes, often advanced its own funds before Medicaid reimbursed it, billed Medicaid in its own name, received the money in its own accou…
Were a library's payments reimbursing Paragon Construction for payroll excluded from gross receipts because Paragon acted as a disclosed payroll agent?
No. Paragon, not the Embudo Valley Library, employed the temporary local workers, issued their paychecks, withheld taxes, provided workers' compensation coverage, and claimed the wages as its own busi…
Were Sacred Garden's receipts from state-authorized medical marijuana sales deductible as receipts from prescription drugs?
No. Sacred Garden satisfied the first statutory element because it was a state-licensed producer authorized to dispense medical marijuana. But a practitioner's certification or recommendation under th…
Could Chamisa Hills Family Dental avoid penalties and interest because a retained office manager failed to open notices, file returns, and make correct tax payments?
No. Chamisa Hills delegated CRS return filing, payments, mail, and electronic tax notices solely to a retained office manager without verifying tax expertise, requiring training, or using controls tha…
Could Marc Gelinas deduct his commissions from sales of implantable prosthetic devices even though he did not possess buyer NTTCs?
Yes. Gelinas was an independent sales agent, not the seller or owner of the implantable prosthetic devices. Hospitals paid manufacturers, manufacturers paid distributors, and distributors paid his 109…
Could ACME Mechanical use construction-service NTTCs obtained more than 40 days after the audit's statutory 60-day deadline?
No. ACME's plumbing receipts would have been deductible and the two NTTCs would have covered the full assessment, but Section 7-9-43 required the certificates by the audit notice's August 2, 2017 dead…
Could Golden Services, a hospice, deduct qualifying managed-care and Medicare Part C receipts under the 2007 version of Section 7-9-93 despite regulations excluding hospices?
Yes. Golden Services' managed-care and Medicare Part C payments satisfied every condition in the 2007 version of Section 7-9-93. That statute did not limit the deduction to a particular type of taxpay…
Was Roswell Hospital Corporation's protest timely when the Department generated a refund-denial notice but could not prove that it mailed it?
Yes. Roswell Hospital filed its protest on February 21, 2017, exactly 210 days after submitting its refund claim. The Department's system had generated a September 19 denial, but no witness had person…
Could Clean Rite avoid gross receipts tax penalties for janitorial work at a Navajo Nation facility because it relied on Raytheon's tax counsel and its own bookkeeper?
No. Clean Rite's janitorial services were performed in New Mexico Indian country for Raytheon, which was neither an Indian tribe nor a tribal member, so the receipts were taxable. Clean Rite conceded …
Could Highland Construction avoid gross receipts tax on nonprofit construction projects because its customers delivered Type 9 NTTCs that it accepted without reviewing?
No. Construction services for nonprofit organizations were fully taxable, and the Type 9 NTTCs from United World College and Collins Lake Autism Center covered purchases of property or construction ma…
Were a handyman and personal assistant's client reimbursements excluded from New Mexico gross receipts tax as amounts received in a disclosed agency capacity?
No. State Construction separately stated its out-of-pocket costs, but it did not prove that it could bind its clients to vendor contracts or that vendors could enforce those obligations against the cl…
Which sales, rentals, repair, training, and rigging receipts of Texas-based Permian Machinery Movers were subject to New Mexico gross receipts tax?
New Mexico could not tax Texas-only training, rigging, repairs, customer-pickup sales, or rentals not shown used here, so $325,221.47 of assessed receipts was removed. Tax remained on interstate riggi…
Could New Mexico assess Eastern Sunbelt Real Estate for gross receipts tax on transactions Roy Rackler conducted individually and mistakenly reported on Schedule C?
No. The Department assessed Eastern Sunbelt because its CRS number was linked to owner Roy Rackler's name, but the transactions were Rackler's individual transactions and did not involve the business.…
Did an out-of-state medical staffing company owe New Mexico gross receipts tax on receipts from about 100 employees working at New Mexico healthcare facilities?
Yes, except for assessment periods barred by the six-year limitations period. All Medical had nexus through about 100 employees working in New Mexico, was not its clients' disclosed agent, and could n…
Could Peabody deduct trainload coal sales as chemicals sold in lots over eighteen tons when an Arizona power plant burned the coal to generate electricity?
No. Although Peabody sold coal in lots far exceeding eighteen tons and combustion involved a chemical reaction, the AHO held that Section 7-9-65 was not intended to restore a repealed coal-sale deduct…
Could Martin Moore challenge an old gross receipts tax assessment by protesting the later warrant of levy after he had not timely protested the assessment itself?
No. Moore received the gross receipts assessment but did not protest it, pay it, or furnish security. After 90 days he became delinquent, and the Department could collect by levy. His later protest co…
Was A Team Productions' protest timely when Department mail records showed a June 15 assessment mailing and the company hand-delivered its protest on September 14?
No. Detailed GenTax, sorting, postage, and USPS records proved that the Department printed, postmarked, and mailed the assessment on June 15, 2016. The 90-day deadline was September 13. A Team hand-de…
Was Louie Casias personally liable for Casias Trucking's tax lien after forming an LLC but never closing the sole-proprietor CRS account or registering the LLC?
Yes. Casias formed an LLC in 2003, but never proved that he closed the sole-proprietor CRS account, registered the LLC for a new CRS number, transferred the business obligations, or obtained the Depar…
Could a Greyhound agent deduct ticket, freight, and vending commissions or defeat the assessments because the Department waited seven years to request a hearing?
No. Farrell's nonemployee commissions were gross receipts. He could not quantify a travel-agent deduction because he had discarded records and could not separate passenger-ticket commissions from frei…
Could an oncology practice recover gross receipts tax on medication receipts when its refund records combined authentic FDA-approved drugs with counterfeit nonapproved drugs?
No. Section 7-9-73.2 did not cover counterfeit, non-FDA-approved drugs, and the practice did not separate receipts for authentic qualifying medications from receipts for counterfeits. Although the rec…
Were Affordable Cellular's Verizon commissions for procuring wireless service agreements subject to New Mexico gross receipts tax?
Yes. Verizon paid Affordable Cellular nonemployee commissions for procuring wireless service agreements, a service performed in New Mexico. The commissions were not employee wages, tangible-property c…
I ran my business as a sole proprietor, then converted it to an LLC and used 'LLC' on my returns. Can the state still hold me personally liable for the gross receipts tax and put a lien on me?
Yes, the owner stayed personally liable and the liens stood — the protest was denied. Richard Casias registered two businesses (R. Casias Trucking and Stars & Stripes Paving) as sole proprietorships t…
Did Ronald Jaynes preserve his gross receipts tax protest by calling officials and trying to resolve the audit before submitting anything in writing after the deadline?
No. The Department mailed the $12,383.81 assessment on April 11, 2016, making July 11 the written-protest deadline. Jaynes contacted Department personnel, the State Auditor, and the Governor's office,…
I run my business from just across the state line and ship products to New Mexico customers — do I owe New Mexico gross receipts tax, and can I avoid it if I couldn't get resale certificates?
Yes, he owed the tax, and the protest was denied. Randall Gilbert sold custom cabinetry from his business in Farwell, Texas (right across the line from New Mexico) to New Mexico building contractors a…
Were RJ Handyman's separately billed material reimbursements and Kayla Marshall's door-knocking work for an out-of-state company taxable New Mexico gross receipts?
Yes. Separately stating material costs satisfied bookkeeping rules but did not prove that RJ Handyman could bind customers or that retailers could enforce obligations against them. Without disclosed a…
Could a USPS Highway Contract Route courier recover $179,732.03 of New Mexico gross receipts tax without its contract, route logs, receipts, or delivery-point records?
No. A Highway Contract Route was the modern name for a star route and fell within New Mexico's specific mail-contractor apportionment rule. Diamond T might have qualified for an interstate-commerce or…
Could CORE avoid gross receipts tax penalties or limit the assessment period because it did not know New Mexico taxes services?
No. CORE's genuine lack of awareness did not establish reasonable care, affirmative misinformation, or reliance on informed professional advice. Its New Mexico educational-service receipts were taxabl…
My tax preparer told me I didn't owe New Mexico gross receipts tax — if that advice was wrong, can the penalty be waived because I relied on a professional?
No — the penalty stood, because relying on a preparer whose competence you never checked is not the 'reasonable reliance on competent counsel or an accountant' the law requires. Hilario Leos and Chris…
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These are official tax letter rulings and advisory opinions issued by New Mexico's revenue authority in response to questions from specific taxpayers about how the tax law applies to their facts. A ruling is binding on the department only for the taxpayer who requested it and cannot be relied on by anyone else, but it is strong evidence of how the state reads the law. Every ruling above has a plain-English question and short answer, plus a link to the full original source.