Article
New Mexico tax credits to help increase cash flow for your business
Feb. 26, 2023 · Authored by Gabriel Sermeno, Brian Short
New Mexico offers several incentive programs to organizations across industries, the most prominent of which are directed at employers offering high-paying jobs, making advancements in the technology sector, or investing in manufacturing. Answers to common questions about these programs are further detailed below.
Top New Mexico tax credits and incentives
The top four tax credits and incentives that your organization could take advantage of include:
High wage jobs tax credit (HWJTC)
The HWJTC is a refundable tax credit designed to incentivize quality job creation, with differing thresholds for jobs in urban versus rural communities. This credit applies to the state portion of the gross receipts, compensating, and withholding taxes, with any excess credit being refunded as cash to the taxpayer.
How much money could be available?
The benefit is equal to 8.5% of the wages paid for each new qualified job created and is capped at $12,750 per job, per year. Employees can generate the credit for up to four years.
What constitutes a quality job?
- $40,000 or more annual salary for employees in rural communities
- $60,000 or more annual salary for employees in urban communities
- Employment of at least 44 weeks
- Employee must be a New Mexico resident
- Employee not related to anyone with more than a 50% owner stake of the company
Gross receipts tax deduction for New Mexico food and beverage businesses
The information provided here is of a general nature and is not intended to address the specific circumstances of any individual or entity. In specific circumstances, the services of a professional should be sought. Tax information, if any, contained in this communication was not intended or written to be used by any person for the purpose of avoiding penalties, nor should such information be construed as an opinion upon which any person may rely. The intended recipients of this communication and any attachments are not subject to any limitation on the disclosure of the tax treatment or tax structure of any transaction or matter that is the subject of this communication and any attachments.