New Mexicoincome tax up to 5.9%, 11th lowest property tax, median home $330K

Worth knowing before you move to New Mexico

New Mexico taxes Social Security only above $100,000 of income for single filers and $150,000 for joint filers, exempts military retirement, and has a graduated income tax with a 5.9% top rate. Home prices are low outside Santa Fe, where they are among the highest in the Mountain West. The state's oil production in the Permian Basin funds a large share of the budget and a permanent fund.

What New Mexico taxes, and what it doesn't

New Mexico levies a graduated income tax that tops out at 5.9%. A household earning $75,000 pays an effective 4.2%, about $3,133 a year; at $150,000 the effective rate is 4.5%. Among the 41 states that tax income, New Mexico has the 19th lowest effective rate at $100,000 of income.

Property tax runs 0.55% of home value a year, roughly $1,815 on the state's median home of $330K. The national effective rate is about 1.10%, and New Mexico has the 11th lowest rate of the 50 states.

Combined state and local sales tax averages 7.82%, the 15th highest in the country (the state portion is 5%).

For retirees: Social Security benefits are not taxed, pension income is partly exempt, and there is no estate or inheritance tax.

Capital gains are taxed as ordinary income.

Housing and the cost of living in New Mexico

New Mexico's cost of living index is 91, where 100 is the national average; that is the 13th cheapest of the 50 states.

The median home costs $330K, 9% above the national figure and the 21st lowest among the states. A two-bedroom rents for about $1,250 a month.

Carrying costs matter as much as the price: home insurance averages $1,600 a year, flood coverage adds about $450 where it is needed, car insurance runs $1,620.

Budget $115 a month for electricity and gas, $460 a month in groceries for two, $950 a month for full-time infant care.

Safety, health and schools

Violent crime is 778 incidents per 100,000 residents in the FBI's 2023 Crime Data Explorer figures, above the median state (387); New Mexico is the 2nd most violent of the 50 by that measure. Property crime is 3,286 per 100,000.

Life expectancy is 74.1 years (County Health Rankings 2024). 9.2% of residents have no health insurance, and the state has expanded Medicaid. The Commonwealth Fund's 2023 scorecard ranks New Mexico's health system 49th of 50.

Education Week's 2023 Quality Counts report ranks K-12 schools 46th in the country.

Politics, guns and social policy

Politically, New Mexico is a solidly Democratic state that went to Harris by 10 points in 2024.

On guns, concealed-carry permits are shall-issue, and Giffords grades the state's gun laws B-.

Abortion is protected by state law. Marijuana is legal for adults. New Mexico is not a right-to-work state, and the minimum wage is $12.00 an hour.

Climate, risk and getting around

Natural disaster risk is high. The main hazards are wildfire, drought, flash-flood. Annual average air quality index is 44 (under 50 is good).

New Mexico has no top-25 hub airport, with about 50 nonstop destinations from its busiest airport.