2019 New Mexico Statutes
Chapter 7 - Taxation
Article 9 - Gross Receipts and Compensating Tax
Section 7-9-69 - Deduction; gross receipts tax; administrative and accounting services.
A. Receipts of a business entity for administrative, managerial, accounting and customer services performed by it for an affiliate upon a nonprofit or cost basis and receipts of a business entity from an affiliate for the joint use or sharing of office machines and facilities upon a nonprofit or cost basis may be deducted from gross receipts.
B. For the purposes of this section:
(1) "affiliate" means a business entity that directly or indirectly through one or more intermediaries controls, is controlled by or is under common control with another business entity;
(2) "business entity" means a corporation, limited liability company, partnership, limited partnership, limited liability partnership or real estate investment trust, but does not mean an individual or a joint venture; and
(3) "control" means equity ownership in a business entity that:
(a) represents at least fifty percent of the total voting power of that business entity; or
(b) has a value equal to at least fifty percent of the total equity of that business entity.
History: 1953 Comp., § 72-16A-14.26, enacted by Laws 1969, ch. 144, § 61; 1990, ch. 43, § 1; 1993, ch. 149, § 1; 1998, ch. 112, § 1; 2002, ch. 21, § 1; 2015, ch. 38, § 1.
ANNOTATIONSThe 2015 amendment, effective July 1, 2015, removed a restriction in the definition of "control" in the gross receipts tax deduction for administrative and accounting services; and in Paragraph (3)(a) of Subsection B, after the semicolon, deleted "and" and added "or".
The 2002 amendment, effective July 1, 2002, throughout the section deleted references to corporations or limited partnerships and substituted "business entity"; added Paragraph B(2) defining "business entity"; added the paragraph and subparagraph designations under Subsection B; and made minor stylistic changes in four places within Subsection B.
The 1998 amendment, effective July 1, 1998, in Subsection A, inserted "or an affiliate" following "corporation" near the beginning, inserted "customer" preceding "services" and substituted "the corporation or an affiliate" for "an affiliated corporation", twice; in Subsection B, substituted "'an affiliate'" for "'affiliated corporation'" and inserted "or a limited partnership" and "or limited partnership" in the first sentence, and substituted "or of an interest in a limited partnership that" for "which" in the second sentence; and inserted "or limited partnership" at the end of Paragraphs B(1) and (2).
The 1993 amendment, effective June 18, 1993, substituted "fifty percent" for "eighty percent" in Paragraphs (1) and (2) of Subsection B.
The 1990 amendment, effective July 1, 1990, designated the former section as Subsection A, inserted "managerial" and substituted "an affiliated" and "an affiliated corporation" for "a wholly-owned subsidiary" in Subsection A, and added Subsection B.
Scope of deduction. — This section is purely exclusionary and limited to machines of a general administrative nature, and heavy construction equipment exchanged by taxpayers in no way qualifies for this exemption. Co-Con, Inc. v. Bureau of Revenue, 1974-NMCA-134, 87 N.M. 118, 529 P.2d 1239, cert. denied, 87 N.M. 111, 529 P.2d 1232.
