Retirement income in New Mexico
Varies
Does New Mexico Tax Retirement Income?
Short answer: Partly. Pensions and 401(k)/IRA withdrawals are taxable, but taxpayers 65+ (or blind) may deduct up to $8,000 per person. The full deduction applies at AGI up to $18,000 single / $30,000 joint, phasing out to zero at $28,500 / $51,000. Classified as partial because of the income-tested age-65 exemption, which applies to any income, not just retirement income.
Pensions, traditional IRA and 401(k) withdrawals are taxable federally either way; Roth withdrawals after 59½ (5-year rule met) are tax-free.
Records to keep: Keep your state return, W-2s and 1099s (1099-R, SSA-1099), and any state credit worksheets. Check your state revenue department's current-year instructions before you file.
Retirement income in New Mexico
Varies
Individuals / Personal Taxes
Partly. Pensions and 401(k)/IRA withdrawals are taxable, but taxpayers 65+ (or blind) may deduct up to $8,000 per person. The full deduction applies at AGI up to $18,000 single / $30,000 joint, phasing out to zero at $28,500 / $51,000. Classified as partial because of the income-tested age-65 exemption, which applies to any income, not just retirement income.
Business justification
Partly. Pensions and 401(k)/IRA withdrawals are taxable, but taxpayers 65+ (or blind) may deduct up to $8,000 per person. The full deduction applies at AGI up to $18,000 single / $30,000 joint, phasing out to zero at $28,500 / $51,000. Classified as partial because of the income-tested age-65 exemption, which applies to any income, not just retirement income. Pensions, traditional IRA and 401(k) withdrawals are taxable federally either way; Roth withdrawals after 59½ (5-year rule met) are tax-free.
Category
- Personal Tax Deductions