SJEDS: San Juan Economic Development: Cost of Doing Business in San Juan County

Business costs for San Juan County New Mexico and the cities of Farmington, Aztec and Bloomfield.

• Corporate Franchise Fee
• Motor Vehicle Registration Fee
• Workers' Compensation Coverage & Assessment Fee
• Corporate Income Tax
• Sales and Use Taxes
• Business Inventory
• Property Tax
• Goods-In-Transit
• Personal Income Tax
• Motor Fuels Tax
• Weight-Distance Tax
• Withholding Payroll Tax

CORPORATE FRANCHISE FEE
$50 annual franchise fee imposed on corporations doing business in the state or chartered or authorized to do business in the state.

Contact NM Tax & Revenue • (505) 827-093

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MOTOR VEHICLE REGISTRATION FEE
$135.50 annual motor vehicle registration for vehicles over 26,000 lbs.

Contact NM Tax & Revenue Communications Office• (505) 827-0909

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WORKERS' COMPENSATION COVERAGE & ASSESSMENT FEE
Workers' compensation insurance coverage is obtained privately from insurance carriers or approved self-insurance groups. Business with substantial financial assets may be self-insured with the approval of the Director of the Workers' Compensation administration. Filing is done by the insurance carrier via electronic filing. A $5 filing fee is required for each proof of coverage.

The coverage requirement applies to:

All employers with three or more employees
All employers in construction trades, regardless of the number of employees

Exemptions from the requirement include:

Real estate salespersons, farm and ranch laborers, domestic servants
Executive employees of a covered corporation may exempt themselves from the corporation's policy. Executive employees are corporate officers who own 10 percent or more of the corporation. The exemption must be filed with the insurance carrier and with the Workers' Compensation Administration.

Employers who are exempt from the requirement may obtain coverage voluntarily by filing an Election to Accept with the Workers' Compensation Administration.

All covered employers are required to pay the workers' compensation personnel assessment fee (including exempt employers who obtain coverage voluntarily). The fee is $4 per employee per calendar quarter, based upon the number of employees who are employed on the last working day of the quarter, and includes equal employer and employee contributions. The fee is paid to the Taxation and Revenue Department. Employers should withhold $2 from each covered employee as a payroll deduction and match the amount with the $2 employer contribution.

Contact Workers' Compensation Administration, Albuquerque• (505) 841-6074

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CORPORATE INCOME TAX
Corporate income tax is levied on the net income of corporations doing business in the state. A 4.8% tax rate applies to the first $500,000 in net taxable income, 6.4% to the next $500,000 and 7.5% to income above $1,000,000. A franchise tax of a flat $50 is also due.

When the corporation (or corporate group filing on either a combined or federal consolidated basis) operates in New Mexico and at least one other state, corporate income tax is determined by applying the allocation and apportionment rules of the Uniform Division of Income for Tax Purposes Act. As a general rule business income is apportioned based on the corporation’s (or group’s) portion of property, payroll and sales in New Mexico, with each factor weighted equally. Manufacturers, however, may elect to determine tax using a formula in which the sales factor is double-weighted. Once elected, this formula must be used for three years before reverting to the basic formula. The double-weighted sales formula lowers the tax for manufacturers with in-state plants that sell most of their product outside New Mexico. New Mexico uses a "throwback" rule. If the taxpayer does not have nexus in another state, its sales from New Mexico to destinations in that other state will be counted as New Mexico sales.