Is Kalshi legal in New Mexico?

The case is State of New Mexico ex rel. Torrez v. Kalshi, Inc. and KalshiEX LLC, filed on June 4, 2026 in the First Judicial District Court, Santa Fe County, as No. D-101-CV-2026-01567 (complaint, p.1). The attorney general's release describes it as seeking "injunctive relief to halt Kalshi's alleged unlawful operations in New Mexico".

The state's theory starts with who may hold a gaming license. The complaint says neither Kalshi nor any of its subsidiaries has sought licensure from New Mexico's Gaming Control Board (¶4, p.2), and that under the Gaming Control Act only a racetrack licensed by the state racing commission or a nonprofit organization may receive a gaming operator's license (¶100, p.23). The only sports betting it says New Mexico expressly permits happens on tribal lands under compacts with tribes and pueblos, at least six of which offer it in person (p.23 n.36).

It pleads four counts, all under state law (pp.29-36): unlicensed gaming (§ 60-2E-13(A)), acting as an unlicensed manufacturer of a gaming device (§ 60-2E-13(B)), providing gaming to people aged 18 to 20 (§§ 60-2E-37 and 56(A)), and public nuisance. The prayer for relief asks the court to permanently bar Kalshi and those acting with it from sports-related gambling and gaming, and from devices that facilitate them, to declare that Kalshi created a public nuisance, and to order it abated (pp.36-37). It seeks no damages or penalties. These are the state's allegations; no court has ruled on them.

Kalshi removed it. On June 8, 2026, KalshiEX LLC and Kalshi, Inc. filed a notice of removal in the District of New Mexico, where the case became No. 1:26-cv-01857 (ECF 1). The state answered with a motion to remand to state court on July 8 (ECF 30). Kalshi filed its opposition on July 29 (ECF 35), the state replied on August 18 and gave notice that briefing was complete (ECF 39, 40). We have not read the removal notice or the briefs, so this page does not describe either side's grounds.

A magistrate judge ruled on August 6 that Kalshi need not respond to the complaint until 21 days after the court decides the remand motion (ECF 38). Chief District Judge Kenneth J. Gonzales has set a remote status conference for November 10, 2026 to schedule a motions hearing (ECF 44). We found no ruling on remand. If the case goes back, it returns to the Santa Fe County court where the state filed it.

On June 12, 2026, the United States and the CFTC filed United States v. State of New Mexico, D.N.M. No. 1:26-cv-01912 (ECF 1). The CFTC's release says it seeks "a declaratory judgment that federal law grants it exclusive authority to regulate event contracts" and a permanent injunction "preventing the state from enforcing preempted state laws against its registrants". The suit originally named the state, Torrez, Governor Michelle Lujan Grisham and four other officials; on June 29 the CFTC dropped the governor and those four, without prejudice (ECF 19).

The CFTC moved for a preliminary injunction on June 18 (ECF 13), and the state and Torrez moved to dismiss on July 16 (ECF 22). Both motions were fully briefed by August 10 (ECF 30, 31). Since September each side has filed notices of rulings from other courts, the CFTC's latest attaching the opinion in United States v. Illinois from the Northern District of Illinois (ECF 41, October 8). The same November 10 conference before Judge Gonzales covers this case (ECF 40), and we found no ruling on either motion.

Other exchanges have gone to the same court against the attorney general: QCX LLC, which runs Polymarket US, filed QCX LLC v. Torrez (No. 1:26-cv-02100) on June 30, followed by Ludlow Exchange (No. 1:26-cv-02576) on August 6 and Underdog Exchange DCM (No. 1:26-cv-02935) on September 8. An appeal from the District of New Mexico goes to the Tenth Circuit. The broader preemption question is in petitions that Kalshi at the Supreme Court follows.

A separate federal suit predates the attorney general's. The Mescalero Apache Tribe and the Pueblos of Isleta, Pojoaque and Sandia sued Kalshi, Inc. and KalshiEX LLC on May 12, 2026, as Mescalero Apache Tribe v. Kalshi, Inc., D.N.M. No. 2:26-cv-01517. District Judge Margaret I. Strickland held a consolidated hearing in Las Cruces on September 23, 2026 on Kalshi's motion to dismiss and the tribes' motion for a preliminary injunction (ECF 54, 59). Since then the tribes have filed a second notice of supplemental authority, citing the Sixth Circuit's September 25 ruling in KalshiEX LLC v. Schuler (ECF 60, September 30), and a further response was filed on October 21 (ECF 63). We have not read the tribes' complaint, and the docket entries we could read show no ruling. Both sides of the wider question are in is Kalshi gambling?

No order or filing we read in any of the New Mexico cases addresses withdrawals, deposits or open positions on Kalshi. The attorney general's suit is aimed at the two companies and their sports offerings, and while the remand question is open Kalshi has not yet had to answer it.

New Mexico argues that Kalshi offers gaming the state never licensed and, under its statute, could not license; the CFTC argues that the contracts belong to federal commodities law and the state cannot reach them. Each is a claim about which regulator governs the exchange. None of the filings we read addresses federal income tax, and the IRS has offered no guidance on event contracts.

Of the people we've seen file, three ways come up most often: gambling winnings and losses, capital gains reported on Form 8949, and the Section 1256 60/40 split on Form 6781. How Realize rebuilds a Kalshi year from its fills under each route is in how to file Kalshi taxes, and the status in every other state is on the Kalshi legal page.