Form an LLC in New Mexico.

Articles of Organization

The formation of a New Mexico LLC means that you have to file articles of organization (along with the $50 filing fee) with the state. The articles, which must be signed by at least two persons, must include:

• The LLC’s name
• The street address of the LLC’s registered office street
• The name of the registered agent there
• The registered agent’s acceptance of appointment as such
• The street address of the LLC’s principal place of business if different from the registered office
• The duration of the LLC and, if not perpetual, the date of its dissolution
• Whether the LLC will be member-managed or manager-managed
• Whether the LLC may operate as a single-member LLC

Your new LLC is officially deemed “organized” after the LLC’s articles of organization and one copy are delivered to the Corporations Bureau of the Public Regulation Commission with the filing fee.

Unless otherwise specified, the articles must be signed in the name of the LLC by a manager (if the LLC is to be manager-managed), a member (if the LLC is to be member-managed), or a person forming the LLC if it has not yet been formed. The document must also state the name and title of each signer.

A certificate of organization will be issued and delivered by the state, along with the conformed copy, to the LLC’s representative.

Registered Agent and Office

All New Mexico LLCs must maintain a registered agent in the state-the person or office designated to receive official state legal and administrative correspondence. An LLC registered agent may be an individual who resides in New Mexico or a business entity authorized to conduct business in the state. The registered agent’s business office must be the same as the corporation’s registered office.

The registered office may be (but is not required to be) a place of business for the LLC.

Operating Agreement

The LLC’s next most critical document is its operating agreement. Having an operating agreement is not legally required by the state, but it’s a very important internal document that sets forth how the LLC will run. The operating agreement should list the LLC’s members, how much each one has invested, how any profits will be distributed, and how much relative weight each member has when voting.

The operating agreement can also include requirements for meetings (notice, quorum, voting rules, etc.) and similar functions, but it doesn’t have to. Often, however, it does include operating constraints and allowances that are already contained in state law and regulations. It also may contain constraints on the members’ authority to change or repeal the operating agreement or a provision thereof. If there is more than one member, the operating agreement must initially be unanimously approved in writing.

Membership in the LLC

An LLC must have at least one member. Members may acquire an interest in the LLC directly when it is being formed. After formation, prospective members can acquire an interest in accordance with the LLC’s articles of organization or operating agreement (or, if the articles of organization or the operating agreement do not specify a procedure, on the written consent of all members).

The contributions of a member to the LLC may consist of cash, property, services rendered, or a promissory note or other binding obligation to contribute cash or property or to perform services.

A member always has the power-although not necessarily the right-to terminate his membership by resigning or retiring at any time. An LLC member may not resign except in accordance with the operating agreement or articles of organization. If a member does resign or withdraw in a manner that violates the rules set forth in those documents, the amount payable to the member from his or her contributions may be reduced by the amount of the damages to the LLC resulting from the violation, and the LLC may defer payment for as long as necessary to prevent unreasonable hardship to the organization.

Unless otherwise stated in the articles of organization or operating agreement, managers are elected or removed-and manager vacancies are filled-by members, using normal membership voting rules.

Ongoing Requirements

Each New Mexico LLC must keep the following types of records available for inspection at its office:

• The names and street addresses of all current and former members and managers
• A copy of the articles of organization and any amendments and related powers of attorney
• A copy of the current and all previous operating agreements
• A copy of the LLC’s federal, state, and local income tax returns for the past three years
• A current statement of the capital contributions made by each member
• The amount of cash and a statement of the agreed-upon value of other contributions made or to be made by each member
• The time(s) or event(s) that would trigger any additional contributions by a member
• Any events that would trigger the LLC’s dissolution
• Any documents required to be available to members by the articles of organization or operating agreements

It’s also a good idea to keep copies of the minutes of the various proceedings and committees meetings of the owners or members.

Dissolution

A New Mexico LLC is dissolved when any one of the following events occurs:

• On the occurrence of an event or events specified in the articles of organization or operating agreement
• Agreement to dissolve by members with a majority share of the voting power
• Judicial decree ordering dissolution

Taxes

An LLC by its nature offers some particular tax advantages over a corporation’s organizational structure, especially when it comes to taxes. This includes access to more deductions, since the LLC is not required to be a separate tax entity like a corporation. Instead, it is considered a “pass-through” entity for tax purposes, meaning that LLC owners report business profits and losses on their individual tax returns.

The tax rate for New Mexico LLCs, therefore, varies, based on the amount of New Mexico taxable net income per reporting period and the rest of the LLC owner/member’s financial situation.