How to File LLC Taxes in New Mexico (2026)
A New Mexico LLC's state tax filing depends on how the IRS classifies it. A single-member LLC reports on Form PIT-1, and a multi-member LLC files Form PTE.
An LLC that elects S-corp or C-corp treatment files Form S-Corp or Form CIT-1 instead. Every form goes to the New Mexico Taxation and Revenue Department.
This page walks through the state form for each LLC type, New Mexico's gross receipts tax, and the pass-through entity tax election. You'll also find the other state taxes that can apply, so you know exactly what to file and when.
Quick Summary
- Confirm your LLC's tax classification first. The form you file with New Mexico depends on whether you're a sole proprietor, partnership, S-corp, or C-corp.
- Only LLCs taxed as a corporation owe the flat franchise tax. Default pass-through LLCs skip it entirely.
- Talk to a CPA before electing the pass-through entity tax. The election is binding for the year and can't be undone by amending your return.
New Mexico LLC Tax Summary
The table below shows which federal and New Mexico state forms apply to each LLC tax classification, plus where to file and the current rate.
| LLC Type | Federal Form | State Form | Filed With | Filing Deadline & Tax Rate |
|---|---|---|---|---|
| Single-member LLC | Schedule C (Form 1040) | Form PIT-1 | New Mexico Taxation and Revenue Department | Graduated rates up to 5.9% |
| Multi-member LLC | Form 1065 | Form PTE | New Mexico Taxation and Revenue Department | Due date of the federal return; graduated rates up to 5.9% |
| S-Corp election | Form 1120-S | Form S-Corp | New Mexico Taxation and Revenue Department | Due date of the federal return; 5.9% if PTET elected plus $50 Franchise Tax |
| C-Corp election | Form 1120 | Form CIT-1 | New Mexico Taxation and Revenue Department | April 15 (calendar year); 4.8%/5.9% graduated plus $50 Franchise Tax |
How New Mexico LLCs Are Taxed
New Mexico taxes LLCs as pass-through entities by default. The IRS has no separate LLC category. A single-member LLC is taxed like a sole proprietorship, and a multi-member LLC is taxed like a partnership, unless the LLC elects otherwise.
New Mexico follows whatever classification the LLC uses for federal purposes. File IRS Form 8832 to be taxed as a C-corp, or Form 2553 to be taxed as an S-corp.
Either election carries straight into your New Mexico return. New Mexico doesn't require LLCs to file a periodic report with the Secretary of State.
Check your New Mexico annual report obligations if you formed a different entity type. See our guide to how LLC taxes work for the federal layer behind all of this.
New Mexico State Taxes by LLC Type
1. Single-Member LLC: Form PIT-1
A single-member LLC pays no separate business tax in New Mexico. The owner reports its income on Form PIT-1, the state's personal income tax return, at rates up to 5.9%.
2. Multi-Member LLC: Form PTE
A multi-member LLC taxed as a partnership files Form PTE, the New Mexico Pass-Through Entities Tax Return. The return is due the same day as the LLC's federal partnership return.
Members report their share of income on their own PIT-1 at rates up to 5.9%, unless the LLC elects the entity-level tax covered below.
3. S-Corp Election: Form S-Corp
An LLC that elects S-corp status files Form S-Corp, the Subchapter S Corporate Income and Franchise Tax Return. It's due the same day as the federal 1120-S.
Electing S-corp status also triggers the $50 annual Franchise Tax. Appointing a registered agent in New Mexico is one sign a corporation is exercising its franchise.
4. C-Corp Election: Form CIT-1
An LLC that elects C-corp status files Form CIT-1 by April 15 for a calendar-year filer, matching the federal Form 1120 deadline. New Mexico taxes corporate net income at 4.8% up to $500,000 and 5.9% above that.
C-corp election also triggers the $50 Franchise Tax. See what an LLC costs in New Mexico for the full fee picture.
5. New Mexico Income Tax Rate for Tax Year 2026
New Mexico taxes personal and corporate income on a graduated scale that tops out at 5.9%. That's the same top rate the state uses for its pass-through entity election.
Confirm your exact bracket on the Department's personal income tax page before you file, since brackets can shift from year to year.
Other New Mexico Taxes That May Apply
Beyond income tax, most New Mexico LLCs also owe at least one of the taxes below depending on what they sell and who they employ.
1. Gross Receipts Tax (Sales and Use)
New Mexico doesn't have a traditional sales tax. Instead it charges a gross receipts tax (GRT) on most sales and services [1]. The state rate is currently 4.875%.
A county and municipal add-on applies on top of that, and it varies by where the sale is delivered. Register and file through the Taxpayer Access Point.
2. New Mexico Employer Taxes
An LLC with employees withholds state income tax from wages and reports it on Form TRD-41414, the Wage-Withholding Tax Return [2]. Withholding on pensions, gambling winnings or other non-wage payments goes on Form TRD-41409 instead.
Employers also register with the Department of Workforce Solutions for unemployment insurance. New Mexico sets the contribution rate between 0.33% and 5.4% by statute. An employer whose calculated rate would run higher pays a capped excess claims premium instead.
3. Industry and Local Taxes
Some New Mexico LLCs owe extra taxes tied to their industry. Check with the department if your LLC operates in a regulated field, since the Taxation and Revenue Department collects:
- Cannabis excise tax from businesses in that industry.
- Insurance premium tax from insurance businesses.
- Oil, natural gas and mineral extraction taxes from businesses in those industries.
Federal Taxes New Mexico LLC Owners Pay
Every New Mexico LLC owner who isn't taxed as a corporation pays federal self-employment tax of 15.3% on their share of the LLC's earnings. New Mexico doesn't charge a separate state self-employment tax on top of that.
Owners who expect to owe $1,000 or more make quarterly estimated payments. Those are due April 15, June 15 and September 15 of the tax year, plus January 15 of the following year.
New Mexico individual filers use Form PIT-ES for their state estimated payments, and the state due dates match the IRS schedule.
New Mexico Pass-Through Entity Tax (PTET) Election
A pass-through entity can elect to pay New Mexico income tax at the entity level instead of passing it through to owners.
The election exists mainly so owners can deduct the payment on their federal return, working around the federal cap on state and local tax deductions.
New Mexico taxes the electing entity at 5.9%, the higher of the state's top personal or corporate rate. You make the election by filing your PTE, S-Corp, or FID-1 return and completing the entity-level tax section.
The election binds every owner for that tax year. A CPA familiar with the Department's rules can model whether the election helps your ownership structure before you file.
What Is Deductible for a New Mexico LLC
New Mexico LLCs can claim several state-specific tax credits on top of their ordinary business deductions. The Taxation and Revenue Department lists personal income tax credits and rebates for individual owners. It also lists industry-specific credits, like the Film Production Tax Credit, for LLCs in that field.
The qualified business income deduction under Section 199A comes from the IRS rather than New Mexico, so check its rules on a federal return instead. Confirm eligibility for any New Mexico credit before you claim it, since requirements vary by program.
References:
- https://www.tax.newmexico.gov/businesses/gross-receipts-tax/
- https://www.tax.newmexico.gov/businesses/withholding-tax-and-workers-compensation/
FAQs
Does Every New Mexico LLC Pay the $50 Franchise Tax?
No, every New Mexico LLC does not pay the $50 franchise tax. Only a corporate tax election triggers it, reported on the Form S-Corp or CIT-1 return.
Does New Mexico Require LLCs to File an Annual Report?
No, New Mexico does not require LLCs to file an annual report with the Secretary of State. That requirement applies only to corporations, which must file one every two years.
What Is New Mexico's Gross Receipts Tax Rate for an LLC?
New Mexico's gross receipts tax rate combines a 4.875% state base with county and municipal add-ons that vary by location. Check the Department's rate map to find your exact combined rate before you register to collect.
Can a New Mexico LLC Elect to Pay the Pass-Through Entity Tax?
Yes, a New Mexico LLC can elect to pay the pass-through entity tax on its PTE, S-Corp, or FID-1 return. You don't need to make quarterly payments. Instead, pay through TAP or the PTE-ES voucher by the return's due date.
