Yes, most types of retirement income are taxable in New Mexico for 2025, though significant exemptions and deductions are available, particularly for low- to middle-income retirees.
Social Security benefits are taxable to New Mexico only for retirees whose income exceeds specific thresholds listed below;
- Single filers: Benefits are exempt if income is under $100,000.
- Married couples filing jointly: Benefits are exempt if combined income is under $150,000.
- Married couples filing separately: Benefits are exempt if income is under $75,000.
For any retirement income that is not exempt or covered by deductions, New Mexico applies a graduated state income tax, with rates for 2025 ranging from 1.5% to 5.9%.
See also Is my military pension/retirement income taxable to New Mexico?