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11172: NM - First Quarterly Estimated Payments for Corporate Income Tax


New Mexico

When does a corporation have to pay estimated taxes and file New Mexico Form CIT-ES, Corporate Income And Franchise Estimated Tax Payment Voucher?


Generally, if a corporation's New Mexico tax after applicable credits is $5,000 or more, the corporation may be required to pay estimated taxes. This obligation is described in the New Mexico Instructions for Form CIT-1 Corporate Income and Franchise Tax Return.

"A corporation is required to pay estimated corporate income tax payments if all the following are true:

  • The corporation is subject to corporate income tax.
  • Its tax after applicable credits is $5,000 or more in the current tax year." (page 6)

NM instructions provide four different methods that can be used to calculate or estimate income tax liability and calculate payment amounts:  

"Use the corporate income tax rate on page 13 to estimate the income tax liability. To avoid penalty and interest for underpayment of estimated tax, calculate the estimated tax using one of these methods:

  • Method 1. 80% of the current year's estimated tax liability.
  • Method 2. 100% of the previous year’s tax liability if it was a full 12-month or a 52/53-week year.
  • Method 3. 110% of the liability for the year immediately preceding the previous tax year if it was a full 12-month tax year or a 52/53-week year and both the following are true:
    • Return for the previous tax year has not been filed
    • Extended due date for filing the previous tax year's return has not occurred by the time the current tax year's first estimated payment is due
  • Method 4. 80% of the estimated tax liability for each quarter of the current tax year, calculated period by period (not cumulatively). Use this method if the income is seasonal or varied throughout the year. NOTE: Method 4 lets you adjust required payments due for each fiscal quarter based on actual income received." (pages 23-24)

See the instructions for more information.


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