Taos, NM Airbnb & Short-Term Rental Regulations 2026

Regulation Overview

An arts-and-ski destination near Taos Ski Valley where both the town and the surrounding county have separately capped short-term rentals within the past two years, making this one of the most permit-constrained markets in the region.

The Town of Taos caps permits at 120 citywide and bans STRs outright in its Historic Districts, Historic/Hotel Overlay zones and Central Business District; unincorporated Taos County separately caps permits at roughly 400 — a combination of hard caps and banned zones across the overlapping jurisdictions.

New Mexico State Law

State preemption: No state preemption. Senate Bill 1162, which would have barred local STR bans and reclassified STRs as residential for zoning/building-code purposes, was defeated on the Senate floor, leaving New Mexico cities and counties with full local control over STR permitting, caps and zoning.

Statewide rules: New Mexico has no statewide STR license. The state's Lodgers' Tax Act (as amended in 2019) requires local lodgers' taxes to be collected on short-term rentals of any size, closing a prior exemption for small bed-and-breakfasts. Operators must also register for the statewide Gross Receipts Tax (GRT), which applies to STR income generally.

Taxes: Statewide Gross Receipts Tax (GRT) applies to STR income (rate varies by location, generally in the high-single-digit percent range). Local Lodgers' Taxes, set independently by each city/county, are layered on top and typically run 5%-7%.

2025–2026 legislation: No new statewide STR bill was confirmed as enacted for 2025/2026. Regulatory change in this region has come from local ordinances — Santa Fe's 2020 permit cap, Taos County's August 2024 county-wide cap, the Town of Taos's separate cap, and Ruidoso's newly rewritten June 2026 ordinance are the most significant recent developments.

Taos Rules

Governing jurisdiction: Town of Taos (in-town) and Taos County (unincorporated county, under a separate ordinance adopted August 2024) — two distinct permit regimes apply depending on parcel location..

• The Town of Taos caps STR permits at 120 citywide, issued strictly first-come-first-served, with permits allowed only in specific zoning districts (RA-20, RA-10, RA-6, RA, R-1, R-2, R-3, R-4, R-6, R-14, C-1 and C-2).
• STRs are banned outright within the town's Historic Districts, Historic and Hotel Overlay Zones, and the Central Business District, with only limited renewal rights for units that were already permitted there.
• Taos County separately adopted its first comprehensive STR ordinance on August 20, 2024, capping permits in the unincorporated county at roughly 400.
• County officials estimated 650-700 existing rentals were eligible to seek a permit under the new county rules, with roughly 220-230 existing home-occupation-permit holders grandfathered in.
• The county ordinance took effect roughly 60 days after adoption, around October 21, 2024, and applies only outside town limits.
• Town STR permits must be renewed annually by November 30 (the permit year runs to September 30).
• The Town of Taos levies a 5.0% Lodgers' Tax on stays under 30 nights, on top of New Mexico's statewide Gross Receipts Tax.

Not confirmed

We could not verify the following against a primary source. Confirm each with the jurisdiction before you rely on it:

• Permit fees for both the town and county programs.
• Occupancy limits, minimum stay, and penalties.
• Whether owner-occupancy is required under either regime.
• Whether permits transfer on sale.
• Current waitlist/availability status under either the town's 120-cap or the county's ~400-cap.

Buyer Due Diligence Checklist

Before you write an offer on a short-term rental here:

• Get a written determination from the governing jurisdiction for the specific parcel. Verbal guidance from anyone else is not diligence.
• Establish which jurisdiction governs — city, town, village and unincorporated county can differ sharply within a few miles.
• Ask whether an existing permit transfers on sale. In many markets it does not, and a listing marketed as a running short-term rental may convey nothing of the sort.
• Read the HOA or condo covenants during your inspection period. Private covenants bind even where the jurisdiction permits the use.
• Model revenue against the legal occupancy cap, not the bedroom count.

Frequently Asked Questions