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Free New Mexico payroll tax
calculator (and NM tax rates)

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  • 1

    Pay Details

  • 2

    Exemptions

  • 3

    Federal Information

  • 4

    State Information

  • 5

    Locale Information

  • 6

    Voluntary Deductions

  • 7

    Calculate Paycheck

Welcome to our payroll calculator!

Before we jump in, who are you using this calculator for?

Thanks!

Our calculators are designed for employers, and they’ll ask for information you may not have. For a better experience, please check out this employee-focused paycheck calculator.

How much did your employee earn?

Gross Pay: This is the total amount of wages your employee earned before taxes and deductions are withheld.


For salaried employees, gross pay equals their annual salary divided by the number of pay periods per year. For hourly employees, gross pay equals the number of hours worked multiplied by their hourly wage.


(Don’t forget to add on any tips, commissions, or bonuses!)

Gross Pay Method: Is the gross pay amount based on your employee’s annual compensation, or by how many hours they worked in the last pay period?

Gross Pay YTD: Enter the total gross pay your employee has earned this year, prior to this paycheck. Normally, this can be found on the last pay stub.

Pay Frequency: How often do you normally issue paychecks?

Check Date: Enter the check date that should appear on your paycheck.

Is your employee exempt from any taxes?

Federal: In some cases, public and governmental employees are exempt from federal taxes. Check “yes” if your employee is exempt and Federal taxes should not be deducted.

FICA: In some cases, public and governmental employees are exempt from FICA. Check “yes” if your employee is exempt and FICA taxes should not be deducted.

Medicare: In some cases, public and governmental employees are exempt from Medicare taxes. Check “yes” if your employee is exempt and Medicare taxes should not be deducted.

Please enter your employee’s withholding information.

2020 W4: Would you like to use the 2020 withholding tables? Here’s an article that covers the 2020 W-4 updates if you aren’t sure.

Federal Filing Status: Select your employee’s filing status for federal withholding. This helps determine how much federal tax will be withheld.

Two Jobs: If the employee indicated that they have more than one job or are married and filing jointly with a working spouse, select Yes here.

Dependents Amount: Enter the amount your employee listed on Line 3 of their W-4, if any. This is where they claim dependents.

Other Income: If your employee listed another other income on line 4(a) of their W-4, enter the amount here.

Deductions: Enter any deductions that your employee listed on line 4(b) of their W-4, if applicable.

Additional Federal Withholding: If your employee has asked to have additional funds withheld from each paycheck, enter the amount here. If they have not, enter “0”.

Round Federal Withholding: Would you like us to round your employee’s withholding totals to the nearest dollar? (It’s not required, but it is permitted)

Now, add information for their state.

State: Select the state where withholding should be calculated. It should be the same state where the work was performed.

Now, add locale information if applicable.

Does your employee have any voluntary deductions?

Please add any additional deductions for items like health insurance, 401(k), HSAs/FSAs, or any other benefits.


Select type of deduction needed:

401(k)

Add deduction

HSA

Add deduction

Custom

Add deduction

Let’s finish crunching the numbers!

Click the button below to see your paycheck calculated.

Here’s your paycheck information:

Leave payroll to us.

We do all the hard work to set you up, starting at just $40 + $6 per employee.

Updated: May 6, 2024

We designed an easy payroll calculator for New Mexico employers. All you have to do is enter wage and W-4 information for each of your employees, and the calculator will do the rest. It will calculate gross pay, take out deductions, and come up with the net pay you’ll need to write your employees’ paychecks.

Federal payroll taxes for New Mexico employers

First and foremost, we need to give Uncle Sam his due. Below is a quick overview of what you need to know when you’re calculating federal payroll tax withholdings. If you would like to get into each calculation in detail, we invite you to check out our step-by-step guide.

  • Calculate Gross Wages:
    • For hourly employees, multiply their hours worked by their pay rate. Don’t forget to pay the higher rate for any overtime hours worked.
    • For salaried employees, divide each employee’s annual salary by the number of pay periods your business has.
    • Bonuses, commissions, and tips are all part of gross wages as well.
  • Subtract Pre-Tax Deductions:
    • If your employees contribute to 401(k), FSA, HSA, or any other pre-tax withholding accounts, subtract their contributions from gross pay prior to applying payroll taxes.
  • Deduct Federal Income Tax:
    • This is the big enchilada, the biggest tax that your employees will pay. Federal income tax rates go all the way up to 37%, depending on the tax bracket that your employees are in. We won’t get into the nitty-gritty here, but you can find further withholding information through the IRS Publication 15-T.
  • Deduct (and Match) FICA Taxes:
    • Social Security Tax: Withhold 6.2% of each employee’s taxable wages up until they reach total earnings of $168,600 for 2024. Any earnings above $168,600 are exempt from Social Security Tax. As an employer, you will also need to pay this tax by matching your employees’ tax liability dollar-for-dollar.
    • Medicare Tax: Withhold 1.45% of each employee’s taxable wages up until they have reached total earnings of $200,000 for the year. You as the employer will also need to match this tax liability dollar-for-dollar. However, for salaries above $200,000, employees need to pay what’s called an Additional Medicare Tax. The rate for this additional tax is 0.9%, which makes the total 2.35%. Only the employee is responsible for paying the Additional Medicare Tax, not the employer.
  • Pay FUTA Unemployment Tax:
    • You will need to pay 6% of the first $7,000 of taxable income for each employee per year, which makes your maximum FUTA tax obligation per employee per year come out to $420. Note that if you pay state unemployment taxes in full and on time, you are eligible for a tax credit of up to 5.4%, making your FUTA tax rate effectively 0.6%. FUTA tax is the sole responsibility of the employer. Your employees are not responsible for paying this tax.
  • Subtract Any Post-Tax Deductions:
    • Most of your employees won’t have post-tax deductions, but some of them could be liable for paying court-ordered wage garnishments, child support, etc. If so, you will need to withhold these deductions from their paychecks.

What are New Mexico payroll taxes?

Now that we’re done with federal income taxes, let’s move on to New Mexico state taxes. The state has a progressive income tax, broken down into four tax brackets ranging from 1.7% on the low end to 5.9% on the high end, which is still on the lower end compared to the rest of the country.

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New Mexico state unemployment insurance

As an employer, you’re responsible for paying SUI (remember, if you pay your state unemployment tax in full and on time, you get a whopping 90% tax credit on your FUTA tax bill).

  • New Mexico’s SUI rates range from 0.33% to 6.4%. The taxable wage base for 2024 is $31,700 for each employee, up from $30,100 in 2023.
  • If you are a new small business owner (congratulations, by the way!), your rates range between 1% – 1.06%.
  • More information for new employers is available per industry here.

Navigating compliance

Did you know that workers’ comp is mandatory for almost nearly all employers in the state? Learn more about who needs coverage and the benefits it provides in our employer’s guide to New Mexico workers’ compensation insurance.

New Mexico workers’ compensation fee

Both employees and employers are required to pay a workers’ compensation assessment fee.

  • The fee for the employer is $2.30 per employee per quarter.
  • The fee for employees is $2.00 per quarter.

 

More details on can be found here.

 

Cut that check

Give yourself a pat on the back! You’ve checked “payroll taxes” off your to-do list so you can move onto the important things like growing your small business. Once each employee’s net pay is calculated (taking deductions and withholdings into consideration), you’re well on your way. All you have to worry about is getting your employees paid on time as well as setting aside whatever you owe in FICA, unemployment taxes, and worker’s compensation. Those numbers can add up quickly if you don’t account for them. You will need to use Form 941 to file federal taxes quarterly, and Form 940 to report your annual FUTA tax. You can pay taxes online using the EFTPS payment system. More information about employment tax due dates can be found here.

Additional New Mexico payroll tax resources

Our calculator is here to help, but of course, you can never learn enough, especially when it comes to payroll taxes. Here are some additional resources and contact information to help you run payroll:

 

Department of Taxation & Revenue (505) 827-0700 | Register Your Business | Wage Withholding Tax

 

Department of Workforce Solutions (505) 841-8405 | Office Locations | What You Should Know About UI

More helpful payroll calculators that New Mexico employers can try

New Mexico employers can use the calculator at the top of this page to quickly calculate their employees’ gross pay, net pay, and deductions in a few clicks. But sometimes a company needs to do a little more math before they can cut staff paychecks. For example, do you own a business where employees get tips from customers? Remember that you are responsible for withholding taxes from your employees’ paychecks based on the tips they receive. Additionally, if an employee leaves for another employer, you’ll need to calculate their final pay. So, if you need a little more help with the number-crunching, check out some of the calculators below.

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