New Mexico Gross Receipts Tax

I can not figure out from your post what your situation is nor what you are asking. That said, I can tell you that New Mexico's Gross Receipts Tax is paid by businesses and self-employed individuals operating in NM. It applies to property and services with certain exceptions. If you perform services in New Mexico as an independent contractor, your gross receipts are subject to the tax. If you are an employee (W-2) of some company and are sent to New Mexico to do some work, your pay is not subject to Gross Receipts Tax.

NM has certain exemptions from the tax and they have certain deductions from the tax. Examples of exemptions are employee wages, textbooks, bail bondsman and minor league baseball stadium receipts. NM has certain deductions from Gross Receipts before applying tax. You must be able to substantiate your deductions. There are certain deductions that can only be substantiated by applying for and obtaining the NTTC (Nontaxable Transaction Certificate). There are 7 different types of NTTCs. Examples of items not necessarily requiring the NTTC are services a New Mexican performs out of state, most foods and medicines. Examples that require the NTTC are items purchased for resale, construction material and subcontractor services sold to a builder, sales of property to out of state buyers for use out of state.

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aerospace r&d business.  Talked to

I am coming at this from an employer side, not employee just to clarify. I've read all the rules, etc. We provide an aerospace R&D service to NM government. Our home base is in another state but we have a couple of "employees" in NM in an office to expedite things. I've read that aerospace R&D can qualify for an NNTC. Then I read that is only for tangible property and not a service. Then I was told if we had independent contractors and not employees, we would of been eligable for an NNTC. My main question is why would that matter in getting an NNTC?

Are you talking about income tax or sales tax? Normally if you have employees in a state, that state can impose sales tax on sales to people living in the state.

And the state can impose income tax on an amount of the business's income that relates to the state. For example if the employees constitute 2% of payroll, the state may tax 2% of the business's income.

aerospace r&d business. Talked to

Receipts from the State of NM are tax exempt. You state you are providing services to NM government. As such, there is no gross receipts tax. If all of your receipts are tax exempt you don't even have to register with the State of NM.