2018 New Mexico Statutes
Chapter 7 - Taxation
Article 2A - Corporate Income and Franchise Tax
Section 7-2A-8 - Credit; income allocation and apportionment.
A. Net income of any taxpayer having income that is taxable both within and without this state shall be apportioned and allocated as follows:
(1) except as otherwise provided in Paragraphs (2) through (4) of this subsection, income shall be allocated and apportioned as provided in the Uniform Division of Income for Tax Purposes Act [Chapter 7, Article 4 NMSA 1978];
(2) except for gambling winnings, nonbusiness income as defined in the Uniform Division of Income for Tax Purposes Act not otherwise allocated or apportioned under the Uniform Division of Income for Tax Purposes Act shall be equitably allocated or apportioned in accordance with instructions, rulings or regulations of the secretary;
(3) other deductions and exemptions allowable in computing federal taxable income and not specifically allocated in the Uniform Division of Income for Tax Purposes Act shall be equitably allocated or apportioned in accordance with instructions, rulings or regulations of the secretary; and
(4) gambling winnings that are nonbusiness income and arise from sources within this state shall be allocated to this state.
B. For the purposes of this section, "non-New Mexico percentage" means the percentage determined by dividing the difference between the taxpayer's net income and the sum of the amounts allocated or apportioned to New Mexico by that net income.
C. A taxpayer may claim a credit in an amount equal to the amount of tax determined to be due under Section 7-2A-5 NMSA 1978 multiplied by the non-New Mexico percentage.
History: 1978 Comp., § 7-2A-8, enacted by Laws 1981, ch. 37, § 41; 1983, ch. 213, § 9; 1986, ch. 20, § 40; 1990, ch. 49, § 12; 1995, ch. 11, § 6; 1996, ch. 16, § 2.
The 1996 amendment, effective April 1, 1996, in Subsection A, substituted "through (4)" for "and (3)" in Paragraph (1), inserted "allocated or" and "instruction, rulings or" in Paragraphs (2) and (3), added the exception at the beginning of Paragraph (2), and added Paragraph (4).
The 1995 amendment, effective June 16, 1995, added "credit" at the beginning of the section heading; substituted "Paragraphs (2) and (3)" for "Paragraphs (2) through (4) in Paragraph A(1)"; deleted former Paragraph A(4) relating to accounting by a taxpayer having income both within and without this state and who began business in this state after July 1, 1981, but prior to January 1, 1991; and made stylistic changes throughout the section.
The 1990 amendment, effective May 16, 1990, designated the former undesignated introductory language as present Subsection A and redesignated former Subsections A to D as Paragraphs (1) to (4) of present Subsection A; and in present Subsection A, rewrote the introductory paragraph which read "Net income of any taxpayer having income which is taxable both within and without this state shall be, prior to the application of the tax rate provided in Section 7-2A-5 NMSA 1978 of the Corporate Income and Franchise Tax Act, apportioned and allocated as follows", substituted "Paragraphs (2) through (4) of this subsection" for "Subsections B, C, D and E of this section" in Paragraph (1), and inserted "but prior to January 1, 1991" and made stylistic changes in Paragraph (4); and added present Subsections B and C.
Am. Jur. 2d, A.L.R. and C.J.S. references. — 71 Am. Jur. 2d State and Local Taxation §§ 287, 294 to 296, 470 to 473, 570, 572 to 577.
State income tax on resident in respect of income earned outside the state, 87 A.L.R. 380.
State income tax in respect of business that extends into other states, 130 A.L.R. 1183.
What constitutes doing business, business done, or the like, outside the state for purposes of allocation of income under tax laws, 167 A.L.R. 943.
Foreign corporation, validity, under Federal Constitution, of state tax on, or measured by, income of, 67 A.L.R.2d 1322.
84 C.J.S. Taxation §§ 41, 158, 171 to 173, 404 to 420, 432 to 433; 85 C.J.S. Taxation §§ 1715 to 1735, 1756 to 1761.
