This summary was computer-generated without any editorial revision. It is not official, has not been checked for accuracy, and is NOT citable.
Facts
Taxpayers, Daniel and Terezinha McGlynn, claimed a credit on their New Mexico tax returns for taxes paid to California on rental income from property located in California. The New Mexico Taxation and Revenue Department denied the credit, leading the taxpayers to protest the decision (paras 2-3).
Procedural History
- Administrative Hearings Office: The Administrative Hearing Officer denied the taxpayers' protest, finding they were not entitled to a credit against their New Mexico taxes for taxes paid to California (para 2).
Parties' Submissions
- Appellants: Argued that the Administrative Hearing Officer erred in applying the dormant commerce clause and the burden of proof standard from Gemini Las Colinas, LLC v. New Mexico Taxation & Revenue Department (paras 3, 9).
- Appellee: [Not applicable or not found]
Legal Issues
- Did the Administrative Hearing Officer err in applying the dormant commerce clause, which restricts double taxation of income between states? (para 3)
- Did the Administrative Hearing Officer apply the correct burden of proof standard as required by Gemini Las Colinas, LLC v. New Mexico Taxation & Revenue Department? (para 3)
Disposition
- The New Mexico Court of Appeals affirmed the decision of the Administrative Hearing Officer, denying the taxpayers' claim for a credit (para 1).
Reasons
Per Duffy J. (Hanisee and Baca JJ. concurring):
The court found that the taxpayers failed to demonstrate that the Administrative Hearing Officer misapplied the statutes regarding the allocation of income and credit for taxes paid to another state. The court noted that the income was designated as nonbusiness rental income, allocated to California, and thus not eligible for a credit in New Mexico. The taxpayers did not provide a developed argument showing how New Mexico's statutory framework violated the dormant commerce clause (paras 4-8).
Regarding the burden of proof, the court held that the taxpayers did not overcome the presumption of correctness of the tax assessment. The taxpayers failed to present sufficient evidence to dispute the factual correctness of the assessment, as required by the precedent set in Gemini Las Colinas, LLC (paras 9-12).