The Overtime Deduction in New Mexico: Why the W-2 Controls, Which State-Law Overtime Doesn’t Count, and Why the State Return Gets Nothing

North Star Tax and Legal Briefing · Sep 9, 2026 · 4m

New Mexico has two overtime laws that don't line up, and only the overtime federal law requires counts toward the new deduction. From 2026 wages on, whatever the employer reports in Box 12 is the ceiling, and the employee can't fix a wrong number himself. We cover which overtime qualifies, how a per diem and a bonus change the rate behind the premium, and why none of it reaches the state return. Full analysis: https://nm-legal.net/overtime-deduction-new-mexico-employers-code-tt-state-conformity/