Quick facts
- New Mexico licenses contractors at state level, with no dollar floor
- NMSA 1978 60-13-12(A) provides that "no person shall act as a contractor without a license issued by the division classified to cover the type of work to be undertaken," and 60-13-12(B) adds that "no bid on a contract shall be submitted unless the contractor has a valid license issued by the division to bid and perform the type of work to be undertaken." The Construction Industries Division of the Regulation and Licensing Department describes its own job as "licensing contractors and enforcing licensing laws."Construction Industries Licensing Act, NMSA 1978 Chapter 60 Article 13 (published by NM Regulation and Licensing Department); New Mexico Construction Industries Division
- A New Mexico city may not demand a second contractor bond
- NMSA 1978 60-13-51 provides that "no municipality shall require any person or corporation licensed under the provisions of the Construction Industries Licensing Act to file or obtain as a condition of doing business as a licensed contractor within the municipality any additional license bond as proof of responsibility if the person or corporation has met the responsibility requirements of the commission." This pre-empts one specific local demand and only that one.Construction Industries Licensing Act, NMSA 1978 Chapter 60 Article 13 (published by NM Regulation and Licensing Department)
- Your licence number goes on every written bid and every permit application
- NMSA 1978 60-13-19(A) requires a licensee to exhibit evidence of the licence on demand and to "clearly indicate his contractor's license number on all written bids and when applying for a building permit." Subsection (B) sets a penalty fee of $150 for failing to do so, payable "to the code jurisdiction or political subdivision that issued the permit."Construction Industries Licensing Act, NMSA 1978 Chapter 60 Article 13 (published by NM Regulation and Licensing Department)
- Gross receipts tax, not sales tax, and it reaches services
- The Taxation and Revenue Department states that gross receipts tax "is imposed on businesses, but it is common for a business to pass the GRT on to the purchaser," and that taxable gross receipts include "performing services in New Mexico, and performing services outside of New Mexico, the product of which is initially used in New Mexico." A contractor's labour is inside the base, not outside it.New Mexico Taxation and Revenue Department: Gross Receipts Tax Overview
- The handyman exemption is $7,200 a year, with three conditions
- NMSA 1978 60-13-3(D)(14) removes from the definition of contractor "an individual who works on one undertaking or project at a time that, in the aggregate or singly, does not exceed seven thousand two hundred dollars ($7,200) compensation a year, the work being casual, minor or inconsequential, such as handyman repairs." It never applies to electrical wiring, plumbing or gas fitting. NMAC 14.6.2.8 repeats the same figure and the same three conditions.Construction Industries Licensing Act, NMSA 1978 Chapter 60 Article 13 (published by NM Regulation and Licensing Department); NMAC 14.6.2: Handyman Certificate
The state layer: a contractor licence, not a business licence
New Mexico does not issue a general statewide business licence in the way Nevada or Washington does. The state credential a contractor needs is the Construction Industries Division licence, and NMSA 1978 60-13-12(A) makes it mandatory: "no person shall act as a contractor without a license issued by the division classified to cover the type of work to be undertaken." NMSA 1978 60-13-12(B) extends the requirement to bidding.
That licence is classification-bound. NMAC 14.6.6.8(A) says it "authorizes contracting only in the scope of work authorized by the classification(s) of the issued license," and that work outside the scope "constitutes a violation of the CILA and its rules and constitutes grounds for disciplinary action." It is also entity-bound: NMAC 14.6.3.8(A)(3)(a) issues licences "only to qualified business entities which employ or are owned by one or more qualifying parties validly certified by CID."
CID describes its own remit as "requiring licensure for any person practicing or offering to practice construction contracting" and "licensing contractors and enforcing licensing laws." If you are looking for a New Mexico state office that issues contractors a general business permission, this is the one, and it is a construction credential rather than a commercial one.
Official sources: Construction Industries Licensing Act, NMSA 1978 Chapter 60 Article 13 (published by NM Regulation and Licensing Department); NMAC 14.6.3: Contractor’s License Requirements; NMAC 14.6.6: Classifications and Scopes; New Mexico Construction Industries Division
The tax layer: gross receipts, and why it is not optional
New Mexico taxes gross receipts. The Taxation and Revenue Department describes the tax as "imposed on businesses, but it is common for a business to pass the GRT on to the purchaser," and lists among taxable gross receipts "performing services in New Mexico, and performing services outside of New Mexico, the product of which is initially used in New Mexico." For a contractor that means the labour side of the invoice sits inside the tax base, which is a different arithmetic from a sales-tax state where services are often outside it.
CID's own rules assume you are registered. NMAC 14.6.3.8(J)(1)(a) requires a licensee changing its name to give CID "an amended registration certificate from the New Mexico department of taxation and revenue," a document that only exists for a registered business.
We state no rate, no filing frequency and no due date. New Mexico gross receipts rates vary by the location where the receipts are reported, and the department's own /businesses/register-your-business/ page returns 404, so nothing about the registration mechanics could be read and verified in this batch. Get both the rate for each job's location and your assigned filing frequency from the department, and do not assume a rate seen on one job applies on the next one.
Official sources: New Mexico Taxation and Revenue Department: Gross Receipts Tax Overview; NMAC 14.6.3: Contractor’s License Requirements
The local layer, and the one thing a city may not demand
New Mexico municipalities run their own business registration and permitting arrangements, and this guide publishes no municipal fee, bond, insurance minimum, dollar threshold, exam requirement or renewal cycle for any of them. Contractor Lane holds no New Mexico local jurisdiction record that has cleared source review for publication, and a local number quoted from an unverified source is exactly the kind of error that makes compliance content dangerous.
What the statute does settle is one specific local demand. NMSA 1978 60-13-51, headed "Contractor's bond; municipal requirement prohibited", provides that "no municipality shall require any person or corporation licensed under the provisions of the Construction Industries Licensing Act to file or obtain as a condition of doing business as a licensed contractor within the municipality any additional license bond as proof of responsibility if the person or corporation has met the responsibility requirements of the commission." If a New Mexico city asks a CILA licensee for a second contractor bond, that section is the answer.
Read it narrowly, though. It pre-empts an additional licence bond as proof of responsibility. It does not say a municipality cannot require a business registration, a tax account, a permit account, or a bond for a different purpose such as a right-of-way or excavation bond. Four different things get called "the local licence" - authority to contract, a local business registration, a local tax account, and a permit account with the building department - and a city can grant one and withhold another. Ask about all four by name for the exact project address, and never assume registration in one New Mexico city creates authority in the next.
The state does reach into the local process at one point. NMSA 1978 60-13-19(A) requires you to "clearly indicate his contractor's license number on all written bids and when applying for a building permit," and subsection (B) sets the $150 penalty fee "payable to the code jurisdiction or political subdivision that issued the permit or in which the work for which the bid is submitted is or would be permitted." So the money for that particular failure goes to the city, not to the state.
Official sources: Construction Industries Licensing Act, NMSA 1978 Chapter 60 Article 13 (published by NM Regulation and Licensing Department)
Who is outside all of this
The handyman exemption is the main route out of the contractor licence, and it is a defined annual ceiling rather than a per-job one. NMSA 1978 60-13-3(D)(14) removes "an individual who works on one undertaking or project at a time that, in the aggregate or singly, does not exceed seven thousand two hundred dollars ($7,200) compensation a year, the work being casual, minor or inconsequential, such as handyman repairs," and excludes electrical wiring, plumbing and gas fitting entirely.
Its three conditions are strict, and one of them is a filing. The work must not be "part of a larger or major operation undertaken by the same individual or different contractor"; the individual "does not advertise or maintain a sign, card or other device which would indicate to the public that he is qualified to engage in the business of contracting"; and the individual "files annually with the division, on a form prescribed by the division, a declaration" to that effect. NMAC 14.6.2.8 repeats all three, which is why New Mexico calls this a handyman certificate rather than simply an exemption.
Two narrower exclusions sit beside it. NMSA 1978 60-13-3(D)(17) covers "any weatherization project not exceeding two thousand dollars ($2,000) that has been approved and is administered by a federal or state agency." NMSA 1978 60-13-3(D)(18) covers short-term depreciable improvements to commercial property "for items not covered by building codes adopted by the construction industry commission" where the total paid, "including materials, services and wages of those who work for him, does not exceed the sum of five thousand dollars ($5,000)."
None of these exemptions touch the tax layer. Being outside the contractor licence does not put you outside gross receipts tax, and it does not put you outside whatever your city requires of a business operating there.
Official sources: Construction Industries Licensing Act, NMSA 1978 Chapter 60 Article 13 (published by NM Regulation and Licensing Department); NMAC 14.6.2: Handyman Certificate; New Mexico Taxation and Revenue Department: Gross Receipts Tax Overview
What actually happens to an unlicensed New Mexico contractor
The criminal exposure scales with the job. NMSA 1978 60-13-52(A) makes acting as a contractor without a licence a misdemeanor, and directs the sentencing court to two tiers: at $5,000 of contracting work or less, up to 90 days in county jail or a fine of $300 to $500, or both; above $5,000, up to six months or a fine of "ten percent of the dollar value of the contracting work," or both. The same subsection reaches "any person who holds himself out as a sales representative of a contractor which contractor is without a license."
The administrative exposure is separate and does not need a conviction. NMSA 1978 60-13-23.1(A) lets the commission assess $300 to $500 at $5,000 or less and up to ten percent of the contract, minimum $500, above it. Subsection (B) doubles the figure for anyone previously suspended, revoked or penalised, and subsection (C) adds $100 for each day of non-compliance with the order, with the attorney general instructed to sue in district court to recover it.
The money you are owed is the third and usually largest exposure. NMSA 1978 60-13-30(A) bars an unlicensed contractor from bringing or maintaining any New Mexico court action for the collection of compensation for work requiring a licence, and requires licensure to be alleged and proved "at the time the alleged cause of action arose." Subsection (B) removes the fallback: an unlicensed contractor "shall have no right to file or claim any mechanic's lien as now provided by law." Court and lien, in one section.
There is a smaller trap for licensed contractors as well. NMSA 1978 60-13-19(B) assesses "a penalty fee of one hundred fifty dollars ($150)" on a contractor who fails to clearly indicate their licence number on all written bids and on building permit applications, payable to the code jurisdiction or political subdivision concerned.
Official sources: Construction Industries Licensing Act, NMSA 1978 Chapter 60 Article 13 (published by NM Regulation and Licensing Department)
Check the official page yourself before you file or sign
New Mexico's contractor rules live in two places that do agree with each other, which is not the norm. The Construction Industries Licensing Act is NMSA 1978 Chapter 60 Article 13, and the operating rules are NMAC Title 14 Chapter 6, served part by part by the State Records Center and Archives. Where this guide quotes a figure, it is quoting one of those two.
Two gaps you should know about before you budget. First, the copy of the Act we read is the Regulation and Licensing Department's own compilation marked 7.1.21, and its text still refers to "Section 4 of this 2021 act", so it is current to mid 2021 and we cannot confirm from it whether a later amendment has landed. Second, and more practically: we state NO New Mexico entity filing fee, NO annual report rule and NO licence application or renewal fee anywhere in this guide. The Secretary of State publishes no fee on a readable page and routes all filings into an online portal, the formation sub-pages we tried return 404, and NMAC 14.6.3.8(D)(1) says only that applications must be "accompanied by the applicable fee as required by 14.5.5 NMAC." Get those numbers from CID and from the Secretary of State directly.
Third, no gross receipts tax rate, filing frequency or due date appears here. New Mexico taxes gross receipts rather than sales, and the Taxation and Revenue Department states that gross receipts tax "is imposed on businesses, but it is common for a business to pass the GRT on to the purchaser," and that taxable gross receipts include "performing services in New Mexico." Rates vary by location in New Mexico and we did not verify any of them in this batch.
Official sources: Construction Industries Licensing Act, NMSA 1978 Chapter 60 Article 13 (published by NM Regulation and Licensing Department); NMAC 14.6.3: Contractor’s License Requirements; New Mexico Secretary of State: Business Services; New Mexico Taxation and Revenue Department: Gross Receipts Tax Overview
Common questions
Does New Mexico have a statewide business licence?
Not in the form some states use. There is no single statewide commercial business licence that every contractor buys; what the state requires is the Construction Industries Division contractor licence under NMSA 1978 60-13-12, registration with Taxation and Revenue for gross receipts tax, and whatever the municipality where you operate requires of a business there. We deliberately state no municipal fee or renewal cycle, because Contractor Lane holds no New Mexico local record that has cleared source review for publication.
Official sources: Construction Industries Licensing Act, NMSA 1978 Chapter 60 Article 13 (published by NM Regulation and Licensing Department); New Mexico Taxation and Revenue Department: Gross Receipts Tax Overview
Can a New Mexico city make me buy a second contractor bond?
No, if you already hold a CILA licence and have met the commission's requirements. NMSA 1978 60-13-51 provides that "no municipality shall require any person or corporation licensed under the provisions of the Construction Industries Licensing Act to file or obtain as a condition of doing business as a licensed contractor within the municipality any additional license bond as proof of responsibility if the person or corporation has met the responsibility requirements of the commission." Read it narrowly: it addresses an additional licence bond as proof of responsibility. It does not stop a city requiring a business registration, a permit account, or a bond for a different purpose.
Official sources: Construction Industries Licensing Act, NMSA 1978 Chapter 60 Article 13 (published by NM Regulation and Licensing Department)
Does gross receipts tax apply to my labour as well as materials?
The Taxation and Revenue Department lists among taxable gross receipts "performing services in New Mexico, and performing services outside of New Mexico, the product of which is initially used in New Mexico," and describes the tax as "imposed on businesses, but it is common for a business to pass the GRT on to the purchaser." So services are inside the base as a general matter. We do not state a rate or a filing frequency, because New Mexico rates vary by location and none was verified in this batch. Confirm the rate for each job's location with the department before you price it.
Official sources: New Mexico Taxation and Revenue Department: Gross Receipts Tax Overview
Can an unlicensed contractor sue a New Mexico customer for payment?
No, and they cannot lien either. NMSA 1978 60-13-30(A) provides that no contractor "shall act as agent or bring or maintain any action in any court of the state for the collection of compensation for the performance of any act for which a license is required by the Construction Industries Licensing Act without alleging and proving that such contractor was a duly licensed contractor at the time the alleged cause of action arose." Subsection (B) adds that any contractor operating without a licence "shall have no right to file or claim any mechanic's lien as now provided by law." New Mexico closes both routes in one section, which is unusual. If your licence lapsed mid-job, note that NMSA 1978 60-13-18(F) suspends a licence "by operation of law" on a late renewal, and take the timing question to a New Mexico construction lawyer.
Official sources: Construction Industries Licensing Act, NMSA 1978 Chapter 60 Article 13 (published by NM Regulation and Licensing Department)
General educational information, not legal, tax, licensing, or insurance advice. Rules, fees, deadlines, and local requirements change. Confirm every item with the responsible agency before relying on it.