New Mexico Guide for Canadians

Quick Facts

State Income Tax	Progressive rates 1.5% to 5.9% (2025)
Gross Receipts Tax	4.875% state + local (varies by municipality)
Driver's License Grace Period	30 days for renewal, no time limit for new residents
Residency Requirement for Tax	Every person required to file federal return
Vehicle Registration Deadline	30 days after establishing residency
REAL ID Deadline	May 7, 2025 for domestic flights

First 90 Days Checklist

Week 1-2: Essential Documents

• Gather required documents for driver's license
• Open US bank account
• Set up temporary mailing address

Week 3-4: Official Registration

• Apply for New Mexico driver's license (no time limit but recommended)
• Register vehicle if brought from Canada (within 30 days)
• Register to vote

Month 2-3: Establishing Residency

• Update address with Canadian financial institutions
• Establish New Mexico ties
• Consider New Mexico vehicle insurance

Driver's License & Vehicle Requirements

For Canadian Citizens

Required Documents:

• Original valid Canadian passport
• Proof of Social Security Number (if applicable)
• Two proofs of New Mexico residential address

Testing Requirements:

• Written knowledge test required for Canadian citizens
• Road test required - NM does not recognize foreign licenses
• Vision screening required

Important Notes:

• No time limit for new residents to get NM license
• REAL ID required by May 7, 2025 for air travel
• 30-day grace period for license renewal only

Vehicle Registration

• Register within 30 days of establishing residency
• Safety inspection required annually
• Emissions testing required in Bernalillo County (Albuquerque area)
• New Mexico insurance required for registration

Tax & Residency Considerations

New Mexico State Tax Benefits

• **Progressive income tax** 1.5% to 5.9% (lower rates for most earners)
• **No inheritance tax**
• **Low property taxes** (0.60% effective rate)
• **Gross receipts tax** instead of sales tax (4.875% state rate)

Establishing New Mexico Tax Residency

New Mexico residency for tax purposes:

• Every person required to file federal income tax return
• Includes nonresidents with New Mexico source income
• Physical presence and intent to establish domicile

Documentation to Establish Residency

• New Mexico driver's license and voter registration
• Bank accounts and utility bills in New Mexico
• Employment or business activities in New Mexico
• Professional licenses, club memberships

US Federal Tax Implications for Canadians

Important: Under the Substantial Presence Test, you may be considered a U.S. resident for tax purposes.
Recommendation: Consult a cross-border tax professional.

Healthcare Considerations

Insurance Options

• New Mexico has no public health insurance for non-citizens
• Travel insurance strongly recommended
• Consider US health insurance if staying permanently
• Quality medical facilities in Albuquerque, Santa Fe

Prescription Medications

• Bring adequate supply from Canada
• Understand prescription transfer requirements
• US prices often higher than Canadian prices
• Research pharmacy options and discount programs

Special Considerations for Snowbirds

Maintaining Canadian Ties

• Keep principal residence in Canada
• Monitor days in U.S. for tax reasons
• Maintain Canadian insurance & banking relationships
• NM residency based on federal filing requirement

Property Considerations

• Very affordable property values
• Homeowner's exemption available ($4,000 head of family)
• Impact on Canada's principal residence exemption
• Consider flood insurance in some areas

Climate & Lifestyle Benefits

• High desert climate with mild winters
• Over 300 days of sunshine annually
• Rich cultural heritage and arts scene
• Lower cost of living than most western states

Travel Documentation

• Ensure passport validity (6+ months remaining)
• Consider Global Entry/NEXUS for easier border crossings
• Track intent and domicile establishment carefully
• No Enhanced Driver's License available in NM

Cost of Living Advantage

New Mexico offers exceptional value with progressive but reasonable tax rates, very affordable housing, and unique cultural experiences. The state provides high desert beauty and southwestern charm.

Key Contacts & Resources