Starting a Limited Liability Company (LLC) in New Mexico is an exciting step toward entrepreneurship. If you’re planning to start your own business or want to take an existing project to the next level, creating an LLC could be the right choice. An LLC provides a flexible legal structure to help you achieve your goals. Let’s get into the steps for setting up your LLC in New Mexico.
Step 1: Choose a Business Name
Choosing the right name for your LLC is the first and crucial step. In New Mexico, your LLC name must:
- Include “Limited Liability Company” or its abbreviations (LLC or LLC).
- Be unique from other business names registered in New Mexico.
- Avoid using restricted words without proper authorization (e.g., “Bank,” “Attorney,” “University”).
Checking Name Availability
Before deciding on a name, use the New Mexico Secretary of State’s website or do a quick, free name check to ensure your desired name is available. If you are considering getting a website name that matches your business name, you can find good deals for your domain names on Namecheap.
Step 2: File Your Articles of Organization in New Mexico
Filing the Articles of Organization is critical to officially forming your LLC in New Mexico. This document registers your LLC with the state and includes essential details about your business.
What to Include in Your Articles of Organization:
- LLC Name: Your LLC’s name must include “Limited Liability Company,” “LLC,” or “LLC” and comply with New Mexico naming guidelines to ensure it’s distinguishable from existing entities.
- Mailing Address: If your LLC’s mailing address differs from its physical location, specify it here.
- Registered Agent: New Mexico requires you to appoint a registered agent to receive legal documents for your LLC. Include their full name and physical address in New Mexico. The agent must consent to this responsibility in writing.
- Management Structure: Indicate whether your LLC is member-managed or manager-managed, and list the members’ or managers’ names and addresses. Using a PO box for addresses is acceptable for privacy reasons.
- Purpose: Please provide a general description of your business activities.
- LLC Organizer: Identify the individual or entity responsible for filing the Articles of Organization. This person or entity plays a crucial role in forming your LLC.
- Formation Date: Select your LLC’s official start date, either on the filing date or a specific future date within 90 days of filing.
- Signing: Before submitting, verify all information for accuracy. Ensure that your registered agent has agreed to their role, then sign and date the form.
How to Send Your Form:
You have three options to file your Articles of Organization in New Mexico.
How to File:
- Online: The New Mexico Secretary of State portal is the most convenient way to file. This method allows for electronic submission and fee payment.
- By Mail: Alternatively, you can file by mail. Download the Articles of Organization form from the Secretary of State’s website and mail it, along with the filing fee, to the Secretary of State, Business Services Division, 325 Don Gaspar, Suite 300, Santa Fe, NM 87501
- In-Person: You can also file in person at the same address in Santa Fe. This option is helpful if you prefer to handle documents directly or have questions for the Secretary of State’s staff.
Filing Fee:
Filing the Articles of Organization in New Mexico costs $50, applicable to all filing methods. This fee is necessary for processing your LLC’s formation documents.
Establishing your LLC in New Mexico requires filing your Articles of Organization. This document forms the legal basis for your business, allowing it to operate within the state. To begin filing, visit the New Mexico Secretary of State’s official website, which offers detailed instructions, forms, and assistance for new LLCs.
Step 3: Deciding on the Management Structure
You’ll need to decide if your LLC will be:
- Member-Managed: All members (owners) share in the day-to-day decision-making processes.
- Manager-Managed: Designated manager(s), who can be members or outsiders, handle the LLC’s daily operations.
This decision will affect how decisions are made within your LLC, so choose the structure that best fits your business model.
Step 4: Making an Operating Agreement for Your Business
Let’s discuss setting up some ground rules for your business. This is where an Operating Agreement comes in. Think of it as a handbook that explains how your business runs. It’s important because it helps everyone understand their role and what’s expected in your LLC.
Here’s what an Operating Agreement usually includes:
- Ownership: This part talks about who owns what percentage of the business.
- Member’s Rights and Responsibilities: Here, you’ll write down what each person in the LLC can and cannot do and what they’re responsible for. It’s like a job description for each member.
- Joining & Leaving: This section covers how new people can enter your business and what happens if someone decides to leave. It’s good to have this figured out so there are no surprises later.
- Dissolution: This might sound a bit gloomy, but it’s practical. It’s about how to close down the LLC if you ever need to. It includes the steps to take and how to handle everything when wrapping up the business.
Creating an Operating Agreement is a smart move. It keeps things clear and organized so everyone knows what to expect, and it can save you a lot of time.
Step 5: Getting Your EIN from the IRS
Your business needs a number called an EIN from the IRS. It’s like an ID number for your business. This number will help you as an identification number when getting bank accounts and credit accounts, filing taxes, and hiring employees.
It’s free, and you can get it from the IRS website at https://www.irs.gov/businesses/small.
Step 6: Hire a Registered Agent
In New Mexico, every LLC is required to have a registered agent. This person or company agrees to receive important legal documents on behalf of your LLC, including tax forms and notices of lawsuits. Your registered agent must:
- Be a resident of New Mexico or a corporation authorized to conduct business in New Mexico.
- Have a physical street address in New Mexico.
You can act as your registered agent, choose someone you trust, or hire a professional service like Northwest Registered Agent or Bizee. Choosing a reliable registered agent ensures that your LLC stays in good legal standing.
Check out our blog: ‘Is a Registered Agent Necessary? Your Guide to Finding an Affordable Option‘
Step 7: Steps After Forming Your LLC
Open a Business Bank Account
Keeping your personal and business finances separate is crucial for financial management and legal protection. Opening a business bank account requires your EIN and Articles of Organization. It makes tracking business expenses easier and simplifies tax filing.
Get a Business Credit Card
A business credit card is an excellent tool for handling business purchases and can help build your company’s credit history. Just like with personal credit, a good business credit score can make it easier to get loans and may qualify you for better terms. Visit our website to see our favorite business cards review.
Check out our blog: Novo Review: The Best Business Banking Account in 2024.
Hire an Accountant
Managing finances can get complicated, especially as your business grows. An accountant can help you navigate tax laws, handle bookkeeping, and plan for financial growth. This professional guidance can save you time and money in the long run.
Create a Professional Website
A website makes your business look legit. WordPress is a great tool to build your site. You can check out SiteGround or Hostinger for web hosting. They’re both good options to get your site up and running.
New Mexico LLC: Permits, Licenses, Tax Requirements, and Annual Reporting
After forming your LLC in New Mexico, there are additional steps to ensure your business operates legally and remains in good standing. This includes obtaining the necessary permits and licenses, understanding tax obligations, and fulfilling annual reporting requirements.
Obtain Any Additional Permits and Licenses
The specific permits and licenses required for your LLC depend on your business activities and location.
Local Business Licenses
- Overview: Many cities and counties in New Mexico require businesses to have local business licenses.
- How to Obtain: Contact your local city or county clerk’s office for information on required licenses and the application process.
Professional Licenses
- Overview: Certain professions may require state-issued professional licenses, such as those in healthcare, legal services, real estate, and construction.
- How to Obtain: The New Mexico Regulation and Licensing Department oversees professional licensing. Visit their website for information on licensing requirements for your profession.
Health Permits
- Overview: If your LLC is involved in food service, healthcare, or any industry impacting public health, you might need a health permit.
- How to Obtain: Health permits are typically issued by the New Mexico Environment Department or local health departments. Check their website for specific requirements and application procedures.
Tax Requirements in New Mexico
Managing your LLC’s tax obligations is crucial for legal compliance and financial health.
Employer Taxes
If you plan to hire employees, you need to:
- Register for Unemployment Insurance Tax through the New Mexico Workforce Connection.
- Register for Employee Withholding Tax through the New Mexico Taxation and Revenue Department.
State Taxes
- Pass-Through Taxation: LLCs in New Mexico are typically treated as pass-through entities for federal tax purposes. However, you may have state tax obligations depending on your business structure and income.
- Gross Receipts Tax: Most businesses in New Mexico are subject to Gross Receipts Tax on the sale of goods or services. Registration and filing are done through the New Mexico Taxation and Revenue Department.
- EIN: All LLCs need an Employer Identification Number from the IRS for tax purposes, even if you don’t have employees. Apply for free on the IRS website.
Annual Reporting in New Mexico
Keeping your business information current with the state is essential for maintaining your LLC’s active status.
- Filing Requirements: New Mexico requires LLCs to file a biennial report (every two years) with the Secretary of State.
- Fees and Filing: The biennial report filing fee is $25. You can file online through the New Mexico Secretary of State’s website.
- Importance: This report updates the state of your LLC’s information and is crucial for keeping your LLC in good standing.
By following these permits, licenses, tax obligations, and biennial reporting guidelines, your New Mexico LLC will be well-equipped to operate successfully and comply with state laws. For more detailed information and updates on regulations affecting New Mexico LLCs, visit the official New Mexico Secretary of State website and the New Mexico Taxation and Revenue Department.
New 2024 Reporting Requirements (BOI)
Effective from January 1, 2024
Big news! Starting January 1, 2024, there are new reporting requirements for both domestic and foreign reporting companies. This includes LLCs, corporations, and other entities. Here’s what you need to know:
First Report Deadlines:
- Existing Entities: If your LLC was already around before 2024, you’ve got until January 1, 2025, to submit your first report.
- New Entities: If you’re forming your LLC in 2024, you must file your report within 90 days of your company’s creation.
Who Needs to Report:
- Domestic Reporting Companies: This includes LLCs and similar entities within the U.S.
- Foreign Reporting Companies: Entities registered foreign entities must also adhere to these new rules.
Exceptions to Reporting:
- For specific exceptions, you’ll want to refer to the Beneficial Ownership Information Reporting Regulations at 31 CFR § 1010.380(c)(2) and the Small Entity Compliance Guide.
What Must Be Reported
What you need to report is all about transparency. The exact details can be found in the compliance guide, but it generally involves information about your LLC’s ownership and control.
When Must Reporting File Reports
Remember, if you’re an existing entity, your deadline is January 1, 2025. For new LLCs formed in 2024, it’s within 90 days of creation.
Filing Reports & Noncompliance Penalties
Starting January 1, 2024, all BOI reports must be filed electronically. Here are some critical points:
- Filing Before the Date: You must file on January 1, 2024.
- Accuracy: Filer certification of accuracy is mandatory – you need to double-check that everything you report is correct and accurate.
Penalties for Noncompliance:
- False Information Penalties: Mistakes or misinformation can lead to a fine of up to $10,000 or up to 2 years in prison.
- Penalties: If you slip up here, you could face a fine of up to $10,000 or even imprisonment for up to 2 years.
- FinCEN’s Approach: The Financial Crimes Enforcement Network (FinCEN) focuses on education and outreach to ensure compliance.
- Safe Harbor Rule: Did you make a mistake? If you discover inaccuracies in your initial report, you have a 90-day grace period to submit a corrected report.
If you need more information or specific guidance, please visit the FinCEN website for all the details.
Starting an LLC in New Mexico is an exciting step towards entrepreneurship. Following these seven simple steps is essential to establish a solid foundation for your business. While this process may require some effort initially, an LLC offers valuable flexibility and protection as your business grows and evolves. Remember, following these steps will help you navigate the process smoothly.
Northwest Registered Agent
Northwest Registered Agent Pricing: What to Expect
Northwest Registered Agent keeps pricing simple. They have a clear, straightforward fee structure, which is a big plus. No hidden fees or surprises – that’s the kind of honesty we all appreciate, right?
Why is Their Pricing Affordable?
- Transparent Costs: They tell you exactly what you’re paying for so you can make informed decisions.
- Competitive Rates: Their prices align with your expectations for top-notch services, ensuring you get good value.
- One-Stop Shop: Since they offer a whole suite of services, you can bundle things together, potentially saving time and money.
- Location: They’re headquartered in Spokane, Washington, but don’t worry – they have offices in all 50 states. So, wherever you are in the U.S., they’ve got local expertise ready for you.
- Experience Counts: These folks have been in the game for over 20 years. That’s a lot of experience under their belt, helping businesses like yours start and grow.
Core Services
- LLC Formation: Dreaming of starting your own LLC? They can help make that happen.
- Registered Agent Service: The main event – they’ll be your reliable point of contact for all those essential legal documents.
- Address Privacy: Keep your address off the public records. It’s all about your privacy.
- Lifetime Customer Support: Got questions? They’re there for you, not just today, but for the life of your business.
- Annual Report Reminders: Never miss a deadline with their handy reminders.
- Online Document Dashboard: All your important documents are organized in one easy-to-access place.
Additional Services (Because There’s Always More)
- EIN Number: They can help you get your business’s unique tax ID.
- Annual Report Service: Let them handle your annual reporting needs.
- Operating Agreements: Need help with the rules for running your LLC? They’ve got you covered.
- Virtual Office Service: Get a professional business address without the office.
- S-Corp Election: Thinking about S-Corp status? They can help with that.
- Mail Forwarding Service: Keep your mail organized and forward it where needed.
- Foreign Qualification: Expanding your business to new states? They can assist.
- Legal Forms: Access a variety of legal forms easily.
- Legal Services (in Indiana): If you’re in Indiana, they’ve got specific legal services just for you.
- Incorporation Services: These are more than just LLCs; they can help incorporate your business, too.
So, if you want to create an LLC, Northwest Registered Agent is very beneficial. They ensure everything runs smoothly, keeping you focused on what you love – growing your business.
