N.M. Admin. Code § 3.3.11.14

Current through Register Vol. 35, No. 23, December 10, 2024

Section 3.3.11.14 - INCOME FROM TRADING SECURITIES ON OWN ACCOUNT

A. Income of an individual, other than a dealer holding securities for sale to customers in the ordinary course of the dealer's trade or business, from the purchase or sale of securities for the individual's own account or from the writing of securities option contracts for the individual's own account is deemed to be income other than income from engaging in a trade or business. The income is allocable to the individual's state of residence.

B. Income of an investment entity from the purchase or sale of securities for the entity's own account or from the writing of securities option contracts in the entity's own account is deemed to be income other than income from engaging in a trade or business. The income attributable to each of the entity's owners is allocable to that owner's state of residence.

C. For the purposes of this regulation, the term "investment entity" means a pass-through entity, as that term is defined in Section 7-3-2 NMSA 1978, meeting the following criteria:

(1) the entity is not a dealer holding securities for sale to customers in the ordinary course of the entity's trade or business;

(2) each of the entity's owners during the taxable year is an individual; and

(3) ninety percent or more of the entity's income during the taxable year derives from the purchase or sales of securities or from writing of securities option contracts.

N.M. Admin. Code § 3.3.11.14

3.3.11.14 NMAC - N, 3/14/01