New Mexico Sales Tax Filing Update July 2019: Marketplace Facilitator Laws
New Mexico passed a law requiring Marketplaces to collect and remit sales tax on sales facilitated through the marketplace effective July 1, 2019.
• Amazon, eBay, Etsy and Walmart began this collection on July 1, 2019.
In this article, we summarize New Mexico's state guidance on the following questions:
- Do I need to register for a sales tax license in New Mexico?
- Should I cancel my existing registration if all my sales are marketplace-collected?
- Do I need to collect sales tax on New Mexico sales on non-marketplace platforms?
- Do I still need to file returns in New Mexico?
- How do I file without paying double tax on the sales that were collected and remitted by my Marketplace?
I've never registered for a New Mexico license. Do I need to register for a sales tax license in New Mexico now?
This new Marketplace Facilitator law does not affect the current requirements to register with the Taxation and Revenue Department (TRD) in New Mexico.
- The New Mexico TRD has more details here regarding the requirements for registration.
Please note, if you are a retailer with a physical presence in New Mexico or you are a remote seller who has crossed the economic nexus threshold for New Mexico ($100,000/year in gross revenue from sales in New Mexico in the last calendar year), then you will need to register for a New Mexico sales tax license.
- If you've imported your sales across all platforms into your TaxJar account, you can determine if you have economic nexus in the state by running the Sales & Transactions Checker.
- If you do not meet any of the criteria that creates nexus in New Mexico (physical, economic or otherwise), you won't need to register for a sales tax license in this state.
I have already registered for a license in New Mexico but and all of my sales are Marketplace-only sales. Should I cancel my existing registration?
Do I need to collect taxes on my New Mexico sales on other platforms?
Yes--if you have nexus in the state (physical or economic) and you make sales to customers in New Mexico on platforms outside of the marketplace that is automatically collecting and remitting, you will also need to collect tax on your end on the New Mexico orders that are processed on the other platforms.
Do I still need to file returns in New Mexico?
Yes--once you register for a license, you will be required to file a return based on the frequency the state has assigned you.
- If you've previously registered, the state expects you to remain registered and continue to file returns.
- If all your sales are Marketplace collected, you would still need to file a return stating reporting no sales activity.
- You may be able to request a filing frequency change but would need to contact the state TRD directly.
I still need to file returns in New Mexico. How do I do this without paying double tax on the sales that were collected and remitted by my Marketplace?
When filing your New Mexico sales, you would include the sales on a marketplace in the total deductions line when adding gross receipts when completing CRS return:
If all of your sales are Marketplace sales, once you deduct the marketplace sales, you will need to file a $0 return.