How To Form an LLC In New Mexico (NM)?

Want to learn how to form an LLC in New Mexico? You’ve come to the right place.

A Limited Liability Company is one of the easiest business entities to start and maintain. It provides flexibility and liability protection by separating your assets from business funds.

Entrepreneurs can get their New Mexico LLC formed within minutes, letting them operate a legal business entity as quickly as possible. That is why we have drafted this step-by-step guide to walk you through forming an LLC in New Mexico.

Choose a Name for Your Business

Choosing a business name is usually the first and most important step in forming an LLC in New Mexico. We recommend choosing a name you and your customers will find easy to memorize and pronounce. You should also ensure your chosen LLC name relates to your business so your customers can understand what you are selling.

You also need to comply with the naming guidelines and requirements in New Mexico. These include the following:

• Your chosen New Mexico LLC name must include one of the following phrases: “limited liability company,” “L.L.C.,” or “LLC.”
• Restricted words, such as Bank, Trustee, Attorney, etc., will need extra legal paperwork and a licensed professional, like a doctor or lawyer, to be part of your New Mexico LLC.
• Your LLC name must be unique and distinguishable from other LLCs in New Mexico.
• Your name should not include words/phrases that can confuse it with government agencies, such as Treasury, State Departments, FBI, etc.

You must also ensure that your chosen business name is available in New Mexico and has yet to be taken by another business entity. The easiest way to check this is via doing a New Mexico LLC name search.

Finally, use a website like Namecheap to check if your chosen business name is available as a web domain. Then, purchase and trademark it immediately to prevent other business entities from acquiring it.

Hire a Registered Agent

A registered agent is a service provider or individual designated to receive and forward all official and legal documents on behalf of the LLC. Your registered agent must fulfill specific criteria, such as having a physical street address in New Mexico, being 18+ years old, and working during the traditional business hours in the state.

All LLCs must appoint a registered agent in New Mexico during the formation process and while running your company.

While you can nominate yourself or any member of your LLC as your LLC’s registered agent, we recommend hiring a commercial registered agent company.

ZenBusiness

One of the best choices for a New Mexico registered agent is ZenBusiness. Ranked #1 on Investopedia, they offer outstanding services that will help you to comply with state requirements.

The starting fee for using ZenBusiness registered agent services is $199 annually. You can also choose to upgrade their registered agent services to get access to annual support alerts and two free filing changes per year.

In addition to offering registered agent services, ZenBusiness provides a couple of other LLC formation services. These include banking, branding, and business planning.

Northwest

Our second recommendation for a registered agent in New Mexico is Northwest. It is slightly more affordable than Northwest, costing only $125 annually.

Their excellent registered agent services include annual report reminders, pre-filled state forms, free mail forwarding, and online document storage. You will also get lifetime support from their customer support experts, known as Corporate Guides.

Once you hire Northwest as your registered agent, you will get a digital account to access all your essential business documents. In addition, if you need assistance forming your LLC, Northwest also offers LLC formation services.

 

Another one of the most affordable registered agent recommendations in New Mexico is InCorp. Founded in 1998, Incorp has helped thousands of happy business owners comply with state requirements.

A year of their registered agent services costs $129. However, if you hire their multi-year registered agent plan, you will get a reduced or discounted fee of $87 per year.

With InCorp, you will get all notifications for your documents in real time, so you don’t need to worry about missing important deadlines.

File an Article of Organization

The next step in forming your LLC is registering your business with the New Mexico Secretary of State.

The easiest and fastest way to do this is by filing an Article of Organization form via the New Mexico Online Business Formation System.

To do this, you must create an account using your active email address and business name. You will also need a payment method, such as a credit and debit card, that you will use to make purchases. While filing your Article of Organization, ensure you include and upload your hired registered agent’s Statement of Acceptance of Appointment. Filing your Article of Organization in New Mexico costs $50.

While filing your LLC Article of Organization, be sure to include the following details:

• The purpose of your LLC
• The name and address of the hired registered agent
• The physical address and mailing address of your LLC.
• The name of your New Mexico LLC.
• The duration or effective date of your LLC
• Whether your New Mexico LLC is manager-managed or member-managed.
• The signatures of the founding members.

Note: you can’t file an article of organization by mail in New Mexico.

Create an Operating Agreement

Unlike filing your LLC Article of Organization, drafting an Operating Agreement for your New Mexico LLC is optional. However, we recommend completing this step as it comes with a vast range of benefits.

An Operating Agreement for your LLC is a written legal document that includes basic information about how your LLC operates. These include the LLC ownership, name, address, purpose, and management structure. Additionally, it defines all the rules regarding capital distribution and the roles/responsibilities of each member. This is vital in preventing future disputes among members.

It is straightforward to create an Operating Agreement in New Mexico. Simply download one of the many Operating Agreement templates online and fill in the required information. You can also hire an LLC formation company to draft one for you.

Acquire Licenses and Permits

Your LLC may be required to acquire licenses and permits to contact businesses in certain areas or engage in certain business activities. For example, if you plan to operate a retail store, you might require a building permit from your city.

If your LLC involves food services, you will require a health license or permit.

In addition, businesses in certain industries may require licenses and permits from the local and state governments. The New Mexico Business Portal can link you to local- and state-level permitting offices. The county or city clerk in your location can also give you more detailed information about the licensing fees and requirements.

Get a Federal and State Tax ID

The next step in forming your LLC in New Mexico is to acquire a Federal and State Tax ID, also known as an Employer Identification Number. However, not every LLC requires this ID. Only business entities taxed as separate entities and have employees are legally required to obtain a Federal and State Tax ID.

Even if your LLC does not legally require a Federal and State Tax ID, acquiring one comes with multiple benefits. For example, it makes it easier to open a business bank and credit account, manage taxation, and file the relevant taxes.

You can obtain your Federal and State Tax ID for free on the IRS website. The application is straightforward and will only take a few minutes to complete. You can also download, fill out, and mail Form SS-4 to the IRS.

Open a Business Bank Account

To maintain the liability protection the Limited Liability Company (LLC) provides, you must keep your personal assets separate from business ones. One of the most critical things you can do is open a business bank and credit account in the name of your LLC.

In addition to keeping your assets separate, opening a business bank and credit account also assists you in building credibility with your business.

Opening a business bank and credit account in New Mexico is easy. You only need to visit your bank and inquire about the requirements and fees for opening an account. Most financial institutions will ask you to provide an EIN, your Operating Agreement, and an Article of Organization.

There are many banks in New Mexico to choose from, including the following:

• First New Mexico Bank
• Nusenda Credit Union
• Century Bank In New Mexico

Buy New Mexico Business Insurance

Purchasing the relevant business insurance policies is another essential step you must complete when setting up an LLC in New Mexico.

By nature, LLCs provide limited liability to their owners. For instance, in case of claims or lawsuits, the personal assets of business owners will remain protected. However, this only protects your personal assets. So, you must purchase proper insurance coverage to protect your LLC.

You can purchase various types of business insurance depending on your business type and goals.

The common types of insurance policies you should consider include the following:

• Workers’ compensation insurance
• Commercial general liability insurance
• Professional liability insurance
• Commercial auto insurance

Get a comprehensive quote for all your business insurance needs by visiting a comparison website like Insureon.

Speed Up the Process With an LLC Formation Package

Purchasing a comprehensive LLC formation package is entirely optional. However, buying one can save you a lot of time and speed up the process of forming your LLC in New Mexico.

Most LLC formation companies, including ZenBusiness, provide formation packages that include all the stages of LLC formation for free. These include naming your business, filing your article of organization, applying for a Federal and State Tax ID, operating agreement, etc. For instance, their Starter LLC formation package is free of charge, excluding the state filing fee. If you want more perks, such as expedited processing, you can purchase their Pro package ($199) or Premium Formation package ($299).

Other LLC formation companies that offer comprehensive and affordable packages include IncFile, Northwest, and LegalZoom.

FAQs About Forming an LLC in New Mexico

How Long Will It Take to Form My New Mexico LLC?

You can get your New Mexico LLC formed in one to three business days if you file your Article of Organization online.

How Much Does It Cost to Set Up an LLC in New Mexico?

At the very minimum, forming an LLC in New Mexico will cost you $50, which is the state fee for filing your Article of Organization. You may also need to cover extra costs to trademark your LLC name, reserve the business name, and apply for the relevant business licenses.

Can I Act as my Own Registered Agent in New Mexico?

You can nominate yourself as a registered agent for your LLC if you live in New Mexico and can work during traditional business hours. However, there are many good reasons you should hire a commercial registered agent service provider.

Here are reasons you should not nominate yourself as a registered agent for your New Mexico LLC:

• Your email address and phone number will be public
• Employees can see your sensitive documents
• There will be fees to pay and many forms to fill out if you move to another state.
• Your address and name will be online.

Can I Form a Single-Member LLC in New Mexico?

Yes. Forming a single-member LLC in New Mexico follows the same steps and guidelines as starting a multi-member LLC.

Get Your New Mexico LLC Started Today

Forming an LLC in New Mexico is an exciting opportunity that can be accomplished by following the steps discussed in this guide. We hope this guide has assisted you in every aspect of forming your New Mexico LLC.

Also see:

• New Mexico (NM) Secretary of State (SOS) LLC & Business Search
• New Mexico (NM) Registered Agent Services
• How To Find New Mexico Bookkeepers