While file my state taxes TT keeps calculating my wife's income as well. Only my income is earned in New Mexico and we live on Texas. How do I solve this issue.

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You should be filing as a nonresident in New Mexico. New Mexico calculates taxable income as if you both lived and worked in New Mexico then applies a percentage based on how much of your total income was from New Mexico sources.

To get that "percentage New Mexico" right, make sure on the NM state tax screen where you designate your New Mexico income that only your income is entered as "New Mexico source". Once you do that, the correct percentage will be applied and you'll only pay New Mexico tax on that percentage of your income.

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