Live in New Mexico, Work Remotely for a Virginia Employer: Who Taxes You?
Answer
New Mexico taxes the income and Virginia cannot. Residency, not the location of the job, drives this answer: New Mexico reaches all of a resident's income, and Virginia has no personal income tax to apply to the part earned inside its borders.
Last verified
The instinct that working in a no-tax state means paying no tax is the single most expensive misunderstanding in this niche. Virginia takes nothing, but New Mexico still taxes residents on income earned anywhere, so the full amount lands on your New Mexico return.
What you file
- 1Resident return · New Mexico
File a New Mexico resident return reporting all of your income.
The two states, side by side
| New Mexico | Virginia | |
|---|---|---|
| Taxes wages | Yes — graduated | Yes — graduated |
| Reciprocity partners | None | 5 (Form VA-4) |
| Convenience rule | No | No |
| Nonresident return | Form PIT-1 with Schedule PIT-B | Form 763 |
| Credit for other-state tax | Form PIT-1 (credit for taxes paid to another state) | Schedule OSC |
| Nonresident safe harbour | None published | None published |
| Local income tax | No | No |
| Revenue department | New Mexico Taxation and Revenue Department | Virginia Department of Taxation |
| Last verified |
The other direction
Reversing the commute does not always reverse the answer. Living in Virginia and working in New Mexico gives:Home state only.
Same two states, different situation
The withholding answer turns on how you are paid and where the work happens, not only on which two states are involved.
- W-2 commuter: New Mexico → VirginiaBoth states — credit offsets the double tax
- 1099 contractor: New Mexico → VirginiaHome state, plus the client state if you work there
- Moved mid-year: New Mexico → VirginiaTwo part-year returns
Other New Mexico pairs
Questions people actually ask
I live in New Mexico and work remotely for a Virginia employer. Which state do I pay?
New Mexico taxes the income and Virginia cannot. Residency, not the location of the job, drives this answer: New Mexico reaches all of a resident's income, and Virginia has no personal income tax to apply to the part earned inside its borders.
Which state should my employer be withholding for?
New Mexico. Your employer should withhold New Mexico tax rather than Virginia tax on these wages. If a Virginia line is showing on your pay stub, raise it with payroll now rather than at filing time.
Does my Virginia employer's location alone create a Virginia tax obligation?
No. Virginia sources wages to the place where the work is physically performed, and it does not apply a convenience-of-the-employer rule that would override that. Days you actually spend working inside Virginia are a different matter — those are Virginia-source income and can require a nonresident return.
How current is this?
The New Mexico and Virginia rules on this page were last checked against New Mexico Taxation and Revenue Department and Virginia Department of Taxation on 2026-08-07. We re-check the full grid every December after state legislative sessions close, and re-check the convenience-of-the-employer states quarterly because that is where the rules move fastest.
Sources
Every fact above comes from the revenue department that publishes the rule. We do not cite secondary summaries, and we do not restate a figure we could not find at source.
- New Mexico Taxation and Revenue Department — individual income taxaccessed 2026-08-07
- Virginia Department of Taxation — individual income taxaccessed 2026-08-07
- Virginia — Form VA-4accessed 2026-08-07
- Virginia Tax — Reciprocityaccessed 2026-08-07