New Mexico IT independent contractor agreement template
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How New Mexico IT independent contractor agreement Differ from Other States
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New Mexico specifically applies the three-part ABC test to determine contractor status for certain state purposes.
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Unlike some states, New Mexico requires explicit compliance with New Mexico Gross Receipts Tax obligations in contractor agreements.
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The agreement must clearly state that New Mexico workers' compensation coverage is not provided, due to state law requirements.
Frequently Asked Questions (FAQ)
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Q: Is a written contract required for IT independent contractors in New Mexico?
A: While not legally required, it is strongly recommended for both parties to have a detailed written agreement to avoid disputes.
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Q: Do New Mexico IT independent contractors need to pay gross receipts tax?
A: Yes, IT independent contractors in New Mexico are typically responsible for registering and paying state gross receipts tax.
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Q: Does the agreement need to address workers’ compensation coverage?
A: Yes, New Mexico law requires stating whether the contractor will be covered by workers’ compensation or not in the agreement.
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New Mexico IT Independent Contractor Agreement
This New Mexico IT Independent Contractor Agreement (the "Agreement") is made and entered into as of [Date], by and between [Client's Full Legal Name], whose principal place of business is located at [Client's Address], (hereinafter referred to as "Client"), and [Contractor's Full Legal Name], whose principal place of business is located at [Contractor's Address], and whose business entity registration number (if applicable) is [Contractor's Business Entity Registration Number], (hereinafter referred to as "Contractor").
1. Scope of Services
Option A: Contractor shall provide the following IT services to Client: [Detailed Description of IT Services, e.g., Software Development, Network Administration, Cybersecurity]. Deliverables include [Explicit Deliverable Descriptions, e.g., source code, network diagrams, security audit reports]. Technical standards: [Technical Standards, e.g., PCI DSS, HIPAA]. Performance metrics: [Performance Metrics, e.g., uptime percentage, bug resolution time]. Measurable milestones: [Measurable Milestones, e.g., completion of module 1 by date, security audit passed by date].
Option B: Contractor shall provide IT consultation services to Client, including [Detailed Description of Consultation Services], resulting in a final report by [Date].
Option C: Contractor shall provide ongoing technical support to Client's customers, as detailed in [Service Level Agreement Document Name].
2. Work Setting
Option A: Services will be performed remotely. Contractor will use the following remote system protocols: [Remote System Protocols, e.g., VPN, RDP].
Option B: Services will be performed on-site at Client's New Mexico location at [Client's Address]. Contractor will be granted the following access rights: [Access Rights, e.g., building access card, network access]. Security clearances required: [Security Clearances, e.g., background check required].
Option C: Services will be performed using a hybrid approach, with [Percentage]% of services performed remotely and [Percentage]% of services performed on-site.
3. Service Period and Timelines
Option A: This Agreement shall commence on [Start Date] and continue until [End Date].
Option B: This Agreement shall commence on [Start Date] and continue on a month-to-month basis until terminated as provided herein.
Option C: This Agreement is for a project with an estimated completion date of [Date]. Key deadlines include: [List of Key Deadlines]. Response/resolution times for support requests will be as detailed in [Service Level Agreement Document Name].
4. Compensation
Option A: Client shall pay Contractor at an hourly rate of [Hourly Rate] per hour.
Option B: Client shall pay Contractor a flat fee of [Flat Fee Amount] for the completion of the services described in Section 1.
Option C: Client shall pay Contractor on a project-based schedule, as follows: [Payment Schedule Details].
All invoices must be submitted by [Date] of each month. Payment will be made within [Number] days of receipt of invoice. Payment method will be [Payment Method, e.g., check, direct deposit]. Contractor is responsible for collecting, reporting, and remitting New Mexico gross receipts tax (GRT).
Contractor is responsible for paying the GRT.
Client is responsible for paying the GRT.
5. Expense Reimbursement
Option A: Client shall reimburse Contractor for reasonable expenses incurred in connection with the performance of services, subject to prior written approval. Expenses must be documented with receipts. New Mexico-specific expense documentation requirements include: [Specific Documentation Requirements, e.g., original receipts, detailed expense reports].
Option B: No expenses will be reimbursed.
Option C: Client will reimburse only the following pre-approved expenses: [List of Approved Expenses].
6. Intellectual Property
Option A: All software, code, inventions, data, or documentation produced under this Agreement shall be considered work-for-hire and owned exclusively by Client.
Option B: Contractor retains ownership of all intellectual property created under this Agreement, but grants Client a non-exclusive, perpetual, royalty-free license to use such intellectual property.
Option C: Ownership of intellectual property will be determined as follows: [Detailed IP Ownership Agreement]. This includes provisions for open-source code or third-party components: [Open Source/Third-Party Component Usage and Licensing]. This assignment is subject to New Mexico statutes on IP assignment.
7. Data Security and Confidentiality
Contractor shall maintain strict data security, confidentiality, and privacy obligations, adhering to all applicable federal laws (e.g., HIPAA, GLBA, if relevant) and New Mexico statutes on data breach notifications. Required IT security practices include: [List of IT Security Practices, e.g., encryption, access controls, firewalls]. Client data handling protocols: [Detailed Client Data Handling Protocols]. Mandatory notification procedures following security incidents: [Detailed Incident Notification Procedures].
8. Independent Contractor Status
Contractor is an independent contractor under New Mexico law and is not an employee of Client. Contractor waives all rights to employment benefits, unemployment insurance, and workers' compensation. Both parties understand the criteria distinguishing independent contractors from employees under New Mexico’s Worker Classification Act and relevant Department of Workforce Solutions regulations.
9. Taxes, Licenses, and Indemnification
Contractor is responsible for all applicable federal, state (including Personal Income Tax and GRT), and local taxes. Contractor must maintain and provide proof of required business licenses and registrations for IT contractors doing business in New Mexico. Contractor shall indemnify Client against any tax or employment-related claims.
10. Insurance
Contractor shall maintain the following insurance coverage:
Professional Liability/E&O Insurance: [Coverage Amount]
Cyber Liability Insurance: [Coverage Amount]
General Liability Insurance: [Coverage Amount]
Contractor shall provide certificates of insurance upon signing and renewal. New Mexico minimum coverage standards for these types of insurance are: [Specific Minimum Coverage Amounts, if applicable].
11. Liability and Indemnification
Contractor’s liability for breach of contract, service downtime, defective deliverables, unauthorized disclosures, intellectual property infringement, or data loss shall be limited to [Dollar Amount or Specific Limitation]. Contractor shall indemnify Client against any claims arising from [Specific Claims Covered by Indemnification]. Remedy procedures in accordance with New Mexico contract law will be: [Detailed Remedy Procedures].
12. Termination
Option A: This Agreement may be terminated by either party upon [Number] days written notice.
Option B: This Agreement may be terminated immediately for cause (material breach, security incident, non-performance).
Option C: This Agreement will terminate upon completion of the services described in Section 1.
Upon termination, Contractor shall provide transition assistance to Client, return or destroy all Client data and equipment, and be paid for completed milestones.
13. Dispute Resolution
Any disputes arising under this Agreement shall be resolved through negotiation and mediation in New Mexico. If arbitration or litigation is required, venue and jurisdiction shall be in [County Name] County, State of New Mexico, and governed by the laws of the State of New Mexico.
14. Compliance with Laws
Contractor shall comply with all applicable New Mexico and federal regulations, including, if applicable, state procurement rules, IT accessibility standards, data protection laws, local labor laws, and IT industry certification requirements.
15. Non-Solicitation and Non-Circumvention
Contractor shall not solicit Client's employees or circumvent Client's customers or business partners for a period of [Number] years after termination of this Agreement, subject to New Mexico enforceability standards.
16. Background Checks and Export Control
Option A: Contractor agrees to submit to a background check if requested by Client.
Option B: Client may conduct a background check on Contractor.
Contractor shall comply with all applicable export control laws if handling restricted technology. Adherence to industry-specific codes of ethics: [Specify Codes of Ethics].
17. Recordkeeping and Audit Rights
Contractor shall maintain accurate records of all services performed under this Agreement. Client shall have the right to audit such records, respecting New Mexico regulatory requirements and privacy laws. Periodic service reviews will be conducted [Frequency of Reviews].
18. Unique Requirements for Public Entities (If Applicable)
If Client is a public entity in New Mexico, the following requirements apply: [Specific Requirements, e.g., Santa Fe’s Living Wage Ordinance, Security Protocols].
19. Amendment, Waiver, and Assignment
This Agreement may be amended only by a written instrument signed by both parties. No waiver of any provision of this Agreement shall be effective unless in writing and signed by the waiving party.
Subcontracting is permitted only with prior written approval from Client. Subcontractor reporting laws in New Mexico must be followed, if applicable.
20. Entire Agreement
This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior or contemporaneous communications and proposals, whether oral or written, between the parties with respect to such subject matter.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.
____________________________
[Client's Full Legal Name]
By: ____________________________
[Client's Signature]
[Client's Printed Name and Title]
____________________________
[Contractor's Full Legal Name]
By: ____________________________
[Contractor's Signature]
[Contractor's Printed Name and Title]