Can the government create a new tax law and apply it to taxes you paid six years ago? The answer is yes if the New Mexico Department of Taxation and Revenue has anything to say about it.
In The GEO Group Inc. v. The New Mexico Department of Taxation and Revenue, the New Mexico Department of Taxation and Revenue allowed the GEO Group to claim a tax deduction for six years worth of taxes. Suddenly, the New Mexico Department of Taxation and Revenue decided the GEO Group was not qualified for these deductions, and attempted to tax and penalize the GEO Group for the past six years it had claimed the deduction. In other words, the New Mexico Department of Taxation and Revenue is now attempting to tax and penalize the GEO Group for relying on previous (and numerous) oral and written representations that the GEO Group could claim the deduction.
We filed a brief in support of the GEO Group’s appeal to the New Mexico Supreme Court, arguing that retroactively taxing the GEO Group violates the U.S. Constitution’s Due Process Clause.
Unfortunately, the New Mexico Supreme Court denied the GEO Group’s petition for writ of certiorari on July 8, 2024. This not only harms residents, but also erodes the state government’s credibility, as it implies New Mexico government agencies now have a potential pathway to enact expansive retroactive laws. We will continue to monitor the situation in New Mexico and work to protect New Mexico taxpayers from any further government overreach.