Payroll New Mexico, Unique Aspects of New Mexico Payroll Law and Practice

The New Mexico State Agency that overseesNew Mexico does not allow compulsory direct
the collection and reporting of State income taxesdeposit
deducted from payroll checks is:New Mexico requires the following information on
Taxation and Revenue Departmentan employee's pay stub:
P.O. Box 630- Gross and Net Earnings
Santa Fe, NM 87504-0630- Employer's name
(505) 827-0867- gross wages and benefits
New Mexico does not have a state form to- hours worked
calculate state income tax withholding.- itemized deductions
Not all states allow salary reductions made underNew Mexico requires that employee be paid no
Section 125 cafeteria plans or 401(k) to beless often than semimonthly, up to 16 days apart;
treated in the same manner as the IRS codemonthly for FLSA-exempt employees.
allows. In New Mexico cafeteria plans are notNew Mexico requires that the lag time between
taxable for income tax calculation; not taxable forthe end of the pay period and the payment of
unemployment insurance purposes. 401(k) planwages earned from 1st-15th of month, pay by
deferrals are not taxable for income taxes;25th; from 16th-end of month, pay by 10th of
taxable for unemployment purposes.next month; 5 days extra for out-of -state
In New Mexico supplemental wages are taxed atpayrolls.
a 7.7% flat rate.New Mexico payroll law requires that involuntarily
You may file your New Mexico State W-2s byterminated employees must be paid their final pay
magnetic media if you choose to.with in 5 working days; 10 days for wages paid
The New Mexico State Unemployment Insuranceby commission, task, or piece rates; next regular
Agency is:payday if suspended due to labor dispute.
Department of LaborVoluntarily terminated employees must be paid
Employment Security Divisiontheir final pay by the next regular payday.
401 Broadway, N.E.Deceased employee's wages must be paid when
P.O. Box 2281normally due to the surviving spouse.
Albuquerque, NM 87102Escheat laws in New Mexico require that
(505) 841-8712unclaimed wages be paid over to the state after
The State of New Mexico taxable wage base forone year.
unemployment purposes is wages up toThe employer is further required in New Mexico
$16,800.00.to keep a record of the wages abandoned and
New Mexico requires Magnetic media reporting ofturned over to the state for a period of 10 years.
quarterly wage reporting if the employer has atNew Mexico payroll law mandates no more than
least 250 employees that they are reporting that50% of minimum wage may be used as a tip
quarter.credit.
Unemployment records must be retained in NewIn the New Mexico payroll law there is no
Mexico for a minimum period of four years. Thisprovision covering required rest or meal periods.
information generally includes: name; social securityNew Mexico statute requires that wage and hour
number; dates of hire, rehire and termination;records be kept for a period of not less than one
wages by period; payroll pay periods and payyear. These records will normally consist of at
dates; date and circumstances of termination.least the information required under FLSA.
The New Mexico State Agency charged withThe New Mexico agency charged with enforcing
enforcing the state wage and hour laws is:Child Support Orders and laws is:
Department of LaborChild Support Enforcement Division
Labor and Industrial DivisionDepartment of Human Services
501 Mountain Rd., NEP.O. Box 25109
Albuquerque, NM 871022025 S. Pacheo
(505) 841-8983Santa Fe, NM 87504
The minimum wage in New Mexico is $5.15 per(505) 827-7200
hour.New Mexico has the following provisions for child
The general provision in New Mexico concerningsupport deductions:
paying overtime in a non-FLSA covered employer- When to start Withholding? next payday after
is one and one half times regular rate afterservice
40-hour week.- When to send Payment? Within 7 days of
New Mexico State new hire reportingPayday.
requirements are that every employer must- When to send Termination Notice? "Promptly"
report every new hire and rehire. The employer- Maximum Administrative Fee? $1 per payment.
must report the federally required elements of:- Withholding Limits? 50% of disposable earnings
- Employee's namePlease note that this article is not updated for
- Employee's addresschanges that can and will happen from time to
- Employee's social security numbertime.
- Employer's nameCharles J. Read, CPA has been in the payroll,
- Employers addressaccounting and tax business for 30 years,the last
- Employer's Federal Employer Identificationfifteen in private practice. Mr. Read is the author
Number (EIN)of "Tax and Accounting Issuesin Forming a New
This information must be reported within 20 daysBusiness."
of the hiring or rehiring.To find professional payroll services at a budget
The information can be sent as a W4 orprice go to paperless payroll company.
equivalent by mail, fax or electronically.For a full service payroll bureau with CPA's on
There is a $20.00 penalty for a late report andstaff visit .
$500 for conspiracy in New Mexico.See an excerpt of Mr. Read's interviews from
The New Mexico new hire-reporting agency canWilliam Shatner's "Heartbeat of America"television
be reached at 888-878-1607 or 505-995-8230 orshow on the web sites linked above.
on the web at