Perhaps you are hoping to form a New Mexico LLC. People assume that starting an LLC is difficult and costly. However, it’s generally not difficult, and the cost would vary across states. We have all the info you need to know about the cost of forming an LLC, particularly the LLC cost in New Mexico.
On this page, you’ll learn about the following:
- New Mexico LLC Cost of Filing
- Taxes Payable to New Mexico Department of Revenue
- Cost Comparison Between States
- Other Costs
New Mexico LLC Cost of Filing
Here are the costs involved in forming an LLC in New Mexico.
Cost of Filing Formation Certificates
The New Mexico Certificate of Formation is responsible for the majority of the cost, which could also vary depending on whether you’re forming a domestic LLC or a foreign LLC. Still, you can file both at the New Mexico Secretary of State.
New Mexico Domestic LLC
- Online Filing costs $50.
- Annual Report filing not required
- Name Reservation fee costs $20
New Mexico Foreign LLC
- Online Filing costs $100.
- Annual Report filing not required
- Name Reservation fee costs $40
- By Mail: Fill out the application form, and send it to Secretary of State Corporations Bureau Chartered Documents Division 325 Don Gaspar, Suite 300 Santa Fe, New Mexico 87501. Costs $100.
Note that filing online is ideal, not only because you need to go to the Secretary of State office, but also it would be faster. You won’t have to wait in a queue in doing so.
New Mexico LLC Formation Service or Registered Agent Fee
You need a registered agent to form an LLC in New Mexico, hence, added costs for service fees. Here are three of the best LLC services on our list that will provide you with registered agents to ease your worries.
Business Permits and Licenses
The business licenses depend on your business’s activity and location and are renewed yearly. As such, the cost will vary. Check the New Mexico Department of Revenue for regulatory boards or agencies requiring licensing.
Taxes Payable to New Mexico Department of Revenue
This article is your ultimate guide to the several taxes that an LLC has to pay in New Mexico. Read on to know the taxes levied by the state & federal governments in New Mexico.
The state taxes to be paid to the New Mexico Department of Revenue are :
State Income Tax
Every member of the LLC formed in New Mexico is liable for the State Income Tax. This tax is charged on the amount a person earns himself through the LLC. Usually, this tax is calculated while filing personal income tax returns. The standard income tax rate in New Mexico ranges from 1.7% to 4.9%, depending on the amount a person earns.
State Sales & Use Tax
The current state sales & use tax rate on LLC in New Mexico is 6.625%. However, the tax rate changes as per the region or city in which the LLC is formed. Every LLC that sells tangible items or is a service provider, has to collect this type of tax & then pay it to the New Mexico Department of Revenue.
Federal Self-Employment Tax
Similar to the State tax, every person earning money from the LLC has to pay this type of tax. It is sometimes called Social Security or Medicare tax. The Federal self-employment tax rate in New Mexico is 15.3 percent.
Federal Income Tax
The Federal Income Tax is levied on the LLC, depending on the earnings of the LLC, the tax bracket applicable to such earnings, & the manner of filing. This Tax is levied on all the profits earned by the company.
Employee & Employer Taxes
An LLC with several employees drawing monthly salaries has to also pay Employee-Employer taxes, in addition to the taxes mentioned above. These tax implications vary, depending on various factors, e.g., the amount, number of employees, etc.
Cost Comparison Between States
New Mexico is surrounded by many states, namely Colorado, Oklahoma, Texas, Arizona, etc. Each of these states has a different rate of taxes levied on LLCs. Let us take a look at this comparative chart.
|States||Filing Fee||Annual/Biennial Fee||Sales Tax|
Based on the kind of industry you LLC operated in, your LLC will be liable to some other taxes & duties. For Example, if your LLC is in the sector of import & export, you have to pay the import-export duty. You should consult with a professional to verify the tax rates or business costs of registering an LLC in New Mexico.
- New Mexico Name Reservation: $20 for online fillings or by mail
- Doing Business As (DBA): $25+$25 for each class code for online filling or if filing by mail
- Certified Document Copies: $15 per document.
- Certified of Good Standing: $25
- Business Domain Name and Website: depend on your preference, but domain name could be as low as $2.99/yr at NameCheap, and web hosting is at least $30/mo at Kinsta.
- Online workspace: at least $4.20/mo for GSuite.
- Business Insurance: would vary depending on insurance type–whether general liability insurance or professional liability insurance–and coverage.
- Dissolution of New Mexico LLC: $25
How Much Does It Cost to Maintain an LLC in New Mexico
To maintain an LLC in New Mexico you do not need to pay an annual fee. However, state income tax at 1.7% to 4.9%, sales & use tax at 6.625% and federal taxes are levied.
Whether you’re forming a new limited liability company or changing your existing one, you might wonder how much does it cost to maintain an LLC in New Mexico. While there are no annual fees for operating an LLC in New Mexico, it does need to be registered with the Department of Taxation and Revenue. This agency is responsible for registering your business and issuing one or more New Mexico business tax ID numbers. There are also payroll, sales & use, and self-employment taxes that your LLC will need to pay.
The first step in forming an LLC in New Mexico is to file Articles of Organization with the Secretary of State. This process is free, but the Secretary of State may charge a fee for certain services. For example, if you need a certified copy of your filings, you will need to pay $25. If you need to change the name of your LLC, you will need to pay $20. You may also need to obtain an employer identification number (EIN), also known as a federal tax ID number. The Internal Revenue Service (IRS) issues EINs to businesses.
You should also be aware that some states require you to file an annual report for your business. This is known as a Certificate of Compliance, and you can obtain one online through the New Mexico Secretary of State’s Business Services portal. You may also need to pay an administrative fee to reinstate an LLC that has been administratively dissolved.
You may also need to register your business with a licensing board. The fees vary by location and business activity. For example, a professional services business may need to be licensed by the New Mexico licensing board. You will also need to pay an annual business license fee depending on your industry. If you plan to operate your business in another state, you will need to obtain a Certificate of Good Standing.
You can also save money by using an online service to file your LLC formation documents. If you choose to file online, you will need an active email address and credit card. This is the easiest way to file your LLC formation documents. However, if you don’t want to use a service, you can visit your local government office to file.
An operating agreement is a legal document that details the operating procedures of your LLC. It will help you avoid internal disputes and keep you on the same page as your fellow business owners. An operating agreement can be written and filed online, but if you prefer to have a lawyer draw up a document for you, you can get one from LLC University for free.
A registered agent is an individual who agrees to receive legal mail on behalf of your business. The registered agent’s job is to ensure that important state communications are delivered to your business. However, the job of a registered agent is very time-consuming and distracting when you are running an enterprise. This is why most people choose to pay a registered agent service to handle this for them.
It is possible to form an LLC without professional help, but forms still have associated costs, regardless of where your LLC is formed.
It is difficult to say whether forming an LLC is expensive. Nevertheless, the cost could be anywhere from $40 to $500. If you refuse to hire professionals, you’ll still have expenses like form fees to cover.
The need to separate personal money from business funds, thus necessitating the creation of a business bank account for your LLC.
The cost of New Mexico is much lower compared to other forms of business. Apart from the state filing fees and annual taxes, you might bear the cost of the registered agent. Compare the price of professional LLC services and choose the most affordable one.