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Category: New Mexico

New Mexico Modified Gross Income

Modified Gross Income (MGI) is unique to New Mexico law. In general, MGI is ALL income and other compensation you receive from ALL sources (regardless of whether that income is taxable by the U.S. Government or the state of New Mexico) for yourself, your spouse and your dependents. You may not reduce MGI by deductions or offset MGI by losses allowed for income tax purposes under the New Mexico Income Tax Act or under the Internal Revenue Code. When calculating MGI, include the MGI of the taxpayer and all household members. Even if you are married but filing separate returns, the total modified gross income of both husband and wife must appear in the calculation.

The following items are excluded from the definition of MGI and DO NOT have to be reported:

  • money lent to you that you are legally bound to repay;
  • the face value of food stamps or WIC vouchers;
  • payments by any party or by Medicare or any similar plan for hospital, dental, medical or drug expenses whether or not the payment is made directly to the insured/recipient or a third-party provider, and whether or not a premium is paid;
  • money received during the year as low-income or property tax rebates or child day care credit;
  • medical care payments made by Medicaid, the State Human Services Department, the County Indigent Hospital Claims Fund, Champus, Veterans’ Administration, or Workers’ Compensation;
  • rent subsidies, weatherization, energy and housing rehabilitation benefits (such as Section 8 housing assistance);
  • stipends paid to foster grandparents; and
  • free room and board when not considered compensation.

Workers Compensation Benefits: Enter unemployment benefits from all sources and Workers’ Compensation benefits received. Do not include medical benefits.

Additional Other income: Enter all income not included on lines 4 through 10, regardless of whether it is taxable as federal or state income. This may include, but is not limited to:

  • interest, including interest from U.S. Government securities and interest on state and municipal bonds;
  • dividends;
  • alimony, separate maintenance and child support payments;
  • gross gambling, gaming and lottery winnings from any source. Do not reduce winnings by any losses;
  • receipt of contribution withdrawals from deferred compensation plans;
  • royalties from any source;
  • distributions from employee stock ownership plans or other employee benefit plans, except for medical benefits;
  • income from discharge of indebtedness (not involving bankruptcy);
  • value of a legacy, devise, bequest or inheritance received;
  • income from an estate or trust;
  • distributions from partnerships, S corporations or similar passthrough entities;
  • scholarships, fellowships, prizes, awards or grants;
  • other cash prizes and awards;
  • insurance or court settlements;
  • amounts received from endowment contracts;
  • the value of room and board received as compensation;
  • all ordinary gains from dealing in or selling property; and
  • cost-of-living, moving or other allowances received as compensation.