New Mexico tax burden — broken down.
New Mexico’s combined tax burden (income + property + sales) lands at 11.70% on our composite — ranking #22 of 51 jurisdictions. The top marginal individual income tax rate is 5.90%.
New Mexico burden, broken into 3 components
| Component | New Mexico rate | National median |
|---|---|---|
| Top marginal income | 5.90% | ~5.30% |
| Effective property | 0.80% | ~1.07% |
| State sales tax | 5.00% | ~5.50% |
| Combined composite | 11.70% | ~11.87% |
National medians from CalcFi’s 51-state composite. Top marginal is the headline single-filer rate, NOT the effective rate most households actually pay.
Retirement + Social Security in New Mexico
New Mexico taxes most retirement income (pensions, IRA / 401(k) distributions). Social Security benefits are NOT taxed by New Mexico. Federal taxation of these income sources is unchanged regardless of state.
How New Mexico compares
Of all 51 US jurisdictions ranked by combined burden composite, New Mexico sits at #22. That places New Mexico in the middle of the pack — burden is moderate without being a particular outlier in either direction. For the live cross-state heat map, see the interactive tax burden map.
New Mexico metros — local tax overlay
State rates are uniform across New Mexico— but local income, property, and sales taxes vary. Click any metro to run the full income tax calculator pre-populated with that city’s local layer.
- Albuquerqueproperty 0.78% · pop 0.9Mmedian $57,800 →
- Santa Feproperty 0.50% · pop 0.2Mmedian $62,200 →
- Las Crucesproperty 0.70% · pop 0.2Mmedian $42,800 →
More New Mexico metros coming as we expand city coverage.
New Mexico tax — common questions
What is the New Mexico top marginal income tax rate in 2025?
New Mexico's top marginal individual income tax rate is 5.90% on the highest bracket.
What is the New Mexico effective property tax rate?
New Mexico's statewide effective property tax rate is 0.80% of home value (annual). On a $400,000 home that's roughly $3,200/yr. Local variation can be ±0.5pp.
Does New Mexico tax retirement income or Social Security?
New Mexico taxes most retirement income, and does NOT tax Social Security benefits.
Are there any New Mexico-specific tax quirks I should know about?
NM uses Gross Receipts Tax (4.875% state + local stacks to 9%+) instead of traditional sales tax — applies to services and B2B, similar to HI; pyramidal effect through economy.
Reviewed by CalcFi Editorial · Source: Tax Foundation State Individual Income Tax Rates (Jan 2025). Last verified 2026-04-19. Methodology at /about/editorial.