How to Start an LLC in New Mexico

Thinking of starting an LLC in New Mexico? Wise choice.

New Mexico’s low LLC formation costs and simple compliance requirements make it an attractive location. Startups, small businesses, and mid-market companies can get up and running right away.

Forming an LLC also means that people will take your business seriously. You can attract investors much easier too. And LLCs offer important personal liability protection.

In this guide, we break down the main steps to creating an LLC in New Mexico in plain language.

Steps Needed to Create an LLC in New Mexico:

Step 1: Name your new LLC
Step 2: Appoint a registered agent
Step 3: File the Articles of Organization
Step 4: Create an LLC operating agreement
Step 5: Get an EIN (Employer Identification Number) from the IRS
Costs to set up an LLC in New Mexico
Further steps

Step 1: Name your new LLC

Choosing your business name is the first, and arguably the most important step in forming your New Mexico.

New Mexico has specific business name requirements. Each LLC name needs to:

Include Limited Liability Company, Limited Company, or a similar abbreviation
Be unique and different from other New Mexico businesses

To check whether your business name is available, use the New Mexico Business Name Search tool:

Avoid names that people might confuse with an existing business. You want to stand out from the crowd and avoid legal problems.

Name reservation (optional)

If you have a company name but aren’t ready to complete your LLC formation in New Mexico yet, you can reserve a business name.

To secure your LLC name for up to 120 days, apply:

On the New Mexico Corporations and Business Services Website
By completing a paper form and sending it by mail

The mailing address is:

New Mexico Secretary of State Office
325 Don Gaspar, Suite 300
Santa Fe, New Mexico 87501

The cost of a New Mexico name reservation is $20.

Step 2: Appoint a registered agent

New Mexico requires all LLCs to have a registered agent in the state. A registered agent agrees to accept tax notices, legal documents, and general correspondence for the LLC.

NM requires the registered agent to be either:

An individual resident of New Mexico (18 years or older) with a physical address in the state (not a P.O. Box)
A domestic corporation, LLC, or a partnership
A foreign corporation, foreign LLC, or foreign partnership

To use any entity as a registered agent, it must use the registered office as its place of business.

The cheapest thing is to be your own registered agent. It’s free.

But there are some concerns about doing so. You must list your address in the public record. That reduces privacy and increases junk mail. Also, registered agents must be available during standard business hours. There can be serious legal consequences to missing a service of process delivery.

If you don't want to be your own registered agent, you can hire one for about $99-$199/year in NM.

If you form an LLC with Northwest, they'll give you a free registered agent for the first year. After that, it's $125 per year.

Step 3: File the Articles of Organization

When you’re ready to form a New Mexico LLC, this step is one to highlight. Filing the articles of organization establishes your new LLC. Your business idea turns into a real entity.

The New Mexico Secretary of State offers the E-file portal to make the process easy and fast. To file your articles of organization, you’ll provide:

Company name and physical address
Purpose and proposed duration
Organizer Information
Registered agent name and contact information

New Mexico charges $50 to approve your LLC documents.

You don’t have to list all LLC members’ personal details on the company documents. New Mexico gives you more privacy compared to some other states.

After the New Mexico SOS approves your LLC, order a Certificate of LLC Registration. Create an account on the state’s business system to request one. They charge a $25 fee for Certified Copies plus $1 per page.

Step 4: Create an LLC operating agreement

New Mexico does not require LLCs to have an operating agreement. But it’s an important document that you should have anyway. It is vital to run a joint venture with partners. And it helps protect your interests and validate your business.

An LLC operating agreement outlines things like:

Ownership and management — key people, rights, duties, capital contributions
How the LLC operates — decision-making power, voting procedures, day-to-day management
How funds will be distributed — lists profit allocations, owners’ draws, salary payments
Other important details – adding/removing owners, how to dissolve the LLC, ways to handle disputes

With an operating agreement, you prevent misunderstandings between members. It lays out many details to create predictability and provide certainty.

You can use an online operating agreement template or pay a lawyer to draft one.

Step 5: Get an EIN (Employer Identification Number) from the IRS

If you have a multi-member LLC, hire employees, or use certain retirement plans, you need to get an Employer Identification Number (EIN).

The Internal Revenue Service (IRS) issues EINs to track tax information such as income and employment withholding. It’s like a Social Security number for your business.

Some single-member LLCs can use the owner’s Social Security number. But an EIN can be necessary for opening a bank account, some state taxes, or certain lending opportunities. Head to the IRS website to get an EIN in minutes. Or mail in a paper application (Form SS-4). Both options are free.

Costs to set up an LLC in New Mexico

The costs to start an LLC in New Mexico are remarkably low. The standard fee for filing the articles of organization is $50. Plan on spending another $25 to get a Certificate of LLC Registration. For $75, you can start a new LLC in NM.

Extra (optional) fees may also include:

$20 to reserve a name>
$50 to file a trademarked name
$50 to $200 per year to hire a registered agent
$0-1,000 or more for an operating agreement

New Mexico does not impose an annual filing fee, which is a major savings compared to most other states.

Further steps

Business bank account

You might be tempted to mix personal and business finances. But this can lead to serious problems. Your LLC needs a dedicated business bank account.

If you don’t separate your business finances, courts can use that as evidence your LLC isn’t a separate entity. This could result in your personal assets being at risk during a lawsuit.

Local tax, licenses, and permits

Every New Mexico LLC must apply for a New Mexico CRS Tax ID number. You’ll need this for all New Mexico business taxes. The Business Portal application process is quick and easy.

Some LLCs also need to get licenses or permits. Liquor sales, construction, and finance professionals are common examples. This New Mexico license and permits page can help you tackle your state needs. Once done there, check with your local municipality. If you have questions, contact the agency to get pointed in the right direction.

Other considerations

Speaking with a qualified insurance agent is a great idea. A workers’ compensation policy and general liability coverage can be vital.

Owning a business can feel like you’re on a deserted island, alone without help. But it doesn’t have to be that way. Get no-cost counseling and training from the New Mexico SBDC. And don’t overlook all of the amazing financing opportunities and business networks.