Horseaddict
Level 3

Thanks for response.  I actually file the return with the credit, however New Mexico has reduced the refund and in a letter stated that the allocation form should be used.  

The taxpayer sold rental property in another state and recognized a capital gain, but is a full-year resident of new Mexico.  It was my determination as a full year resident, he would simply receive credit for the taxes paid.  New Mexico apparently disagrees.