The R&D Tax Credit is back! Find out how the Big Beautiful Bill Act can fund your R&D. Learn More
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New Mexico offers the Technology Jobs and Research and Development Tax Credit, which provides a strong incentive for companies that perform qualified research in the state. The credit is designed to encourage investment in high-technology jobs and can be claimed alongside the federal R&D credit.
The program has two key components:
Qualified expenses include wages paid to New Mexico-based R&D employees, equipment and supplies used in research, and costs of contract research performed within the state.
To claim the credit, taxpayers must file Form RPD-41386, Technology Jobs and R&D Tax Credit Application, with the New Mexico Taxation and Revenue Department. The credit is refundable for certain small businesses, and otherwise may be carried forward for up to three years.
📄 New Mexico Taxation & Revenue – R&D Credit Overview
📄 Form RPD-41386 + Instructions (PDF)
It’s important to note that New Mexico is one of the few states offering a refundable R&D credit, which makes it especially valuable for startups and growth-stage companies with limited tax liability. Established firms can still benefit from significant offsets against state taxes, particularly when combined with the federal credit. Our team helps you evaluate eligibility, document qualifying activities, and file to maximize both immediate refunds and long-term tax savings.
Starting in tax year 2025, businesses can now immediately deduct domestic R&D expenses in the year they occur instead of spreading deductions over five years. The bill also offers refund opportunities for small businesses and faster deduction schedules for larger companies.
If your business has $31 million or less in annual gross receipts, you may be able to:
File amended returns for 2022–2024 to get cash refunds for previously capitalized R&D costs
Deduct remaining unamortized R&D expenses faster starting in 2025
Apply your R&D credit against payroll taxes—up to $500,000 per year for qualifying startups
Yes. Eligible small businesses can retroactively deduct R&D costs from 2022–2024 and claim refunds. Even larger companies can accelerate the deduction of past R&D costs over one or two years starting in 2025.
No. The 15-year amortization rule for foreign R&D remains in place. The new immediate expensing option only applies to U.S.-based research and development.
Savings vary, but many businesses may recover hundreds of thousands of dollars through a combination of:
Full expensing of domestic R&D costs
Retroactive refunds for 2022–2024
Annual R&D tax credits (often worth 5–10% of qualifying expenses)
Startups with less than $5 million in annual revenue can use the R&D credit to offset payroll taxes—up to $500,000 per year—resulting in quarterly cash refunds, even without taxable income.
Work with our expert team at TaxTaker. We help innovative companies like yours identify, document, and claim the maximum R&D tax credit available—while ensuring you stay fully compliant with IRS requirements. Our team specializes in both federal and state R&D tax credits, and we know how to uncover hidden value by reviewing past filings for potential refund opportunities. With the new 2025 rules in place, we’ll build a tailored strategy that maximizes your savings now and in the years ahead. That’s why businesses across the country trust TaxTaker to deliver results they can count on.
Working with TaxTaker is risk free. TaxTaker collects a success fee only if you qualify for a tax credit.
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