What are the taxes that self-employed people have to pay?
Self-employed people should be aware that they must pay all of their own Social Security & Medicare taxes (aka self-employment or SE taxes) on their business profits and NM Gross Receipts Tax (GRT) on their business sales. Here's an example comparing the application of these taxes.

Type of TaxINCOME TAXSELF-EMPLOYMENTGROSS RECEIPTS

FederalNMFederalNM
Reporting Form1040PIT-11040CRS-1
Total sales (gross receipts)$100,000

$100,000
Business expenses-75,000


Sales not subject to GRT (deductions)


-15,000





Net profit from business$25,000 $25,000 $25,000





Sales subject to GRT


$85,000





Tax rates (federal tax bracket)15.00%4.00%15.30%7.50%





Tax$1,734 $1,000 $3,825 $6,375

 Owners of small businesses would benefit from attending one of regularly scheduled IRS New Business Workshops.

Also read: Isn't the New Mexico gross receipts tax the same as sales tax?