How to Form a Corporation in New Mexico
To establish a corporation in New Mexico, here's everything you need to know.
To form a corporation in New Mexico, you need to take the steps set forth below. To find out what’s required to form a corporation in any other state, see Nolo’s 50-State Guide to Forming a Corporation.
1. Choose a Corporate Name
Your corporation's name must must include one of the following words or an abbreviation: "Incorporated," "Corporation," "Company," or "Limited."
Your corporation's name must be distinguishable from the names of other business entities already on file with the New Mexico Corporations Bureau. Names may be checked for availability at the New Mexico Corporations Division business name database.
You may reserve a name for 120 days by filing an Application for Reservation of Corporate Name with the New Mexico Public Regulation Commission Corporation Bureau. The application must be filed by mail. The filing fee is $25.
2. Prepare and File Articles of Incorporation
Your corporation is legally created by filing Articles of Incorporation with the Corporations Bureau of the New Mexico Public Regulation Commission. The articles must include the corporate name and address; the duration, if not perpetual; the purpose; the name and address of agent for service of process; the number of shares the corporation is authorized to issue; the name and address of each incorporator; and the name and address of the board of directors. A signed Statement of Acceptance of Appointment by Designated Initial Registered Agent must be submitted with the articles. This is included with the articles form.
The articles may be filed online or by mail. The filing fee is based on the number of shares the corporation authorizes. The minimum fee is $100, the maximum is $1,000.
3. Appoint a Registered Agent
Every New Mexico corporation must have an agent for service of process in the state. This is an individual or corporation that agrees to accept legal papers on the corporation's behalf if it is sued. A registered agent must be either an individual resident of New Mexico, or a domestic corporation having a place of business in New Mexico, or a foreign corporation authorized to transact business in New Mexico and having a place of business in New Mexico. The registered agent must have a physical street address in New Mexico. The agent should agree to accept service of process on your corporation's behalf prior to designation.
4. Set Up a Corporate Records Book
Set up a corporate records book in which you keep all of your corporation's important papers, including minutes of director and shareholder meetings, stock certificates, and stock certificate stubs. Keep your corporate records book at the principal office of your corporation. You can use a three-ring binder as the corporate records book or you can order a special corporate records kit through a corporate kit supplier.
5. Prepare Corporate Bylaws
Bylaws are an internal corporate document that set out the basic ground rules for operating your corporation. They are not filed with the state. Your corporation is not legally required to have corporate bylaws, but you should adopt them because they (1) establish your corporation's operating rules, and (2) help show banks, creditors, the IRS, and others that your corporation is legitimate. For corporate bylaw forms, see Nolo’s website or Incorporate Your Business, by Anthony Mancuso (Nolo). Corporate kits also typically contain sample bylaws.
6. Appoint Initial Corporate Directors
The incorporator—the person who signed the articles—must appoint the initial corporate directors who will serve on the board until the first annual meeting of shareholders (when the board members who will serve for the next term are elected by the shareholders). The incorporator must fill in an “Incorporator’s Statement” showing the names and addresses of the initial directors. The incorporator must sign the statement and place a copy in the corporate records book. The statement need not be filed with the state. For a sample Incorporator's Statement, see Incorporate Your Business, by Anthony Mancuso (Nolo).
7. Hold Your First Board of Directors Meeting
The first meeting of the corporation's board of directors should be held at which the directors can appoint corporate officers, adopt bylaws, select a corporate bank, authorize issuance of shares of stock, set the corporation's fiscal year, and adopt an official stock certificate form and corporate seal. The directors' actions must be recorded in corporate minutes prepared by the incorporator or any of the directors. Additionally, if the corporation will be an S corporation, the directors should approve the election of S corporation status. It is usually necessary to prepare the minutes over one or two weeks, and then send them to all the directors for their signature. For corporate meeting minute forms, see Nolo’s website or refer to Incorporate Your Business, by Anthony Mancuso (Nolo).
8. Issue Stock
Issue stock to each shareholder. Although not legally required in most states, small corporations usually issue paper stock certificates. Enter each shareholder's name and contact information in the corporation’s stock transfer ledger. A share of stock in your corporation is classified as a security under state and federal securities laws that regulate the offer and sale of corporate stock.
However, the federal government and all states exempt most small corporations from these laws. For example, federal law exempts "private offerings": a non-advertised sale to a limited number of people (generally 35 or fewer); most states have enacted their own versions of this SEC exemption. Visit your state securities office website for information about your state's securities laws. Links to all such offices can be found at the Contact Your Regulator web page of the North American Securities Administrators Association.
9. Comply with New Mexico Biennial Report Requirements
All corporations doing business in New Mexico must file a Biennial Profit Corporate Report with the Corporations Bureau every other year. A First Report must be filed within 30 days after the corporation's articles are issued or a foreign corporation qualifies to do business in New Mexico. A biennial report is due on or before the fifteenth day of the third month following the end of the corporation’s taxable year.
The report can be filed online, or by mail. The filing fee is $25.
10. Comply With Other Tax and Regulatory Requirements
Additional tax and regulatory requirements apply to your corporation. These include:
EIN: Your corporation must obtain a federal employer identification number (EIN). You may obtain an EIN by completing an online application on the IRS website. There is no filing fee.
S Corporation Filing: If the corporation wants to elect S corporation status for tax purposes, it must submit Form 2553 Election by a Small Business Corporation (signed by all the shareholders. The election should be filed within two months and 15 days after the beginning of the corporation's first tax year. See the IRS S Corporation Fact Sheet for details.
State Tax Registration: All New Mexico and Foreign corporations authorized to do business in New Mexico must register with the New Mexico Taxation and Revenue Department. You may register online at the New Mexico Taxation & Revenue Taxpayer Access Point, or you may file a paper Application for Business Tax Identification Number with any local Taxation and Revenue Department office. After registering you will receive a New Mexico tax identification number. There is no fee to register or obtain a CRS identification number.
Business Licenses: Depending on its type of business and where it is located, your corporation may need to obtain other local and state business licenses.
11. Foreign Corporations Doing Business in New Mexico
All corporations organized outside of New Mexico must register with the New Mexico Corporations Bureau to do business in New Mexico. Foreign corporations must appoint a registered agent for service of process physically located in New Mexico. To register, file an Application for Certificate of Authority. The application must be accompanied by an original certificate of good standing or existence, no more than 30 days old, from the Secretary of State or similar official of the foreign corporation's home state. The form may be filed on-line, or by mail. The filing fee is based on the number of shares the corporation is authorized to issue. The minimum fee is $200.
Before filing, make sure the corporation's name is available in New Mexico by checking the New Mexico business name database. If the name is not available in New Mexico, a resolution by the board of directors adopting a fictitious name for use in transacting business in New Mexico must be submitted with the application. The resolution must be signed by an authorized officer and must identify the New Mexico state agency that turned down the true corporate name.