Incorporate in New Mexico for FREE^*

Incorporation is the process of registering a business as a corporation and making it recognizable under law as its own legal entity. Incorporating a business can be a complicated process because each state has its own requirements for registering and operating a business as a corporation. Knowing the necessary steps and forms, however, will help keep you organized and stress-free. 

With our easy business registration service, you simply answer a few questions and we create your initial paperwork and file it with the state for you. The first business entity registration is free for Rocket Legal+ members—you pay only the state filing fees. Then, you can make and personalize all the legal documents you need for your business. Store everything online in your Rocket Lawyer account.

What is a C-Corp? 

A C-Corp, or C-Corporation, is a common business entity type. More specifically, a C-Corp is a corporation taxed under Subchapter C of the U.S. Code. Under Subchapter C, corporations are subject to tax at both the corporate and individual level (sometimes called “double taxation”). Depending on the situation, this may result in lower or higher tax burdens for the shareholders. 

C-Corps allow for anyone to be an investor and for an unlimited number of shareholders and multiple share classes.

As with other types of corporations, C-Corporations provide a common and well-known legal structure for businesses and offer their shareholders some limited liability. Except for certain instances of fraud or misconduct, a shareholder is not liable for the debts or obligations of a corporation beyond the shareholder's investment into the corporation.

Corporations are treated as a C-Corp by default, unless another type of tax treatment is selected, such as an S-Corp.

What is an S-Corp? 

Like C-Corps, S-Corps provide a common and well-known legal structure for businesses and offer their shareholders some limited liability. However, S-Corps have two main differences from C-Corps: they are taxed differently and they have more restrictions with shares.

An S-Corporation, or S-Corp, is an IRS election that allows a company to be treated like an LLC for income tax purposes, that is, as a “pass-through" entity. Instead of income taxes being owed at both the company and individual level, the income of an S-Corp is only taxed at the individual level, which means it passes through the company directly to the owners and shareholders. Again, this may result in lower or higher tax burdens for the shareholders depending on the situation.

S-Corps have more restrictions regarding shares and shareholders than C-Corps. Specifically, S-Corps can have no more than 100 shareholders, only one class of shares, and only U.S. residents or citizens as investors.

One area of common confusion is what type of entity can elect S-Corp status. Remember that this election is simply a tax choice, not a governance or legal structure choice. Both limited liability companies (LLCs) and corporations can choose S-Corp status if they qualify under the IRS's guidelines.

There are similarities between a New Mexico S-Corp and a C-Corp regarding personal liability, management, structure, and compliance. The differences in New Mexico, however, come down to the following:

• Ownership Rules: A C-Corp is taxed as a separate entity from its shareholders. Shareholders report and pay taxes on what the corporation pays them. An S-Corp is taxed like a partnership with a "pass-through" tax structure. It's not doubly taxed because it can pass corporate income, losses, deductions, and credits to its shareholders. Corporate owners pay taxes on their shares of the corporation's profits, and they're taxed at their individual rates. To qualify as an S-Corp, your business must be a domestic corporation, provide only one class of shares, have no more than 100 shareholders, and your shareholders can include only individuals, certain trusts, and estates.
• Documents: If you want to form an S-Corp, you must file IRS Form 2553 to elect this status.

Your corporation’s name should be unique and make a statement about your business. Make sure it complies with the following New Mexico requirements:

• Your name must be distinguishable from that of any other registered business in New Mexico. It must end with an approved designation, such as "Corporation," "Company," "Incorporated," "Limited," or an abbreviation of one of these terms.
• Your name can't be deceptive. If you're selling jewelry, don't name your company "Del Gato's Internet Cafe."
• Ensure that your name is distinguishable from that of any other existing corporation.

Need help coming up with a business name for your corporation? Try the Rocket Copilot™ AI Business Name Generator, a free tool to help you brainstorm business names and get started registering your corporation.

Each state has its own personnel requirements for incorporating. In New Mexico, corporations must have at least one director, and there must be a president, secretary, and treasurer. The names and addresses of directors must be listed in your Articles of Incorporation.

There is no minimum age requirement for directors. There is also no requirement that directors must live in New Mexico.

New Mexico requires that you appoint a registered agent. A registered agent is the person or business who receives important tax, government, and legal documents for your corporation, including service of process of lawsuits. Your agent must be available during normal business hours. The name of your registered agent must be included in your Articles of Incorporation, and your agent must have a physical address in the state. Your corporation cannot act as its own registered agent. We can help you designate your registered agent when you incorporate with us.

You must also include the following in your Articles of Incorporation:

• The number of shares authorized to be issued.
• The designation of each class and series of shares.
• Statements as to the relative rights and authority of the board of directors to divide or change the designation of such shares.
• Any shareholder preemptive rights.

Your Articles of Incorporation must be filed with the New Mexico Public Regulation Commission, Corporations Bureau.

New Mexico requires that you file an initial profit corporate report within 30 days of incorporation. A biennial report must also be filed with the New Mexico Department of State on or before the fifteenth day of the third month following the end of your tax year. A franchise tax must also be paid by this date, along with any corporate income tax. Your corporation must also provide its shareholders with an annual financial statement.

Nearly every state has standard processing times, but not all provide expedited processing for corporations. In New Mexico, there are a few fees that you may be charged when you register your business as a corporation. They include the following:

State fee: $110.

Rocket Lawyer filing fee: $0 $99.99.

• First filing FREE* for Rocket Legal+ members (excluding state fees).
• Get additional filings HALF OFF with Rocket Legal+.

Processing time: 4-5 weeks.

Note: The above state fees and processing times (including expedited processing fees and times) are provided as a summary and may or may not encompass various fees mandated by your state or local authorities. Your state may also change these fees and processing times over time and without notice. If you have questions, speak to a Rocket Lawyer Business Pro to understand the costs and processing times that apply to your specific filing.

Businesses can save up to $2,500 per year with a Rocket Legal+^™ membership. This calculation is based on total savings on an initial business registration and registered agent, trademark, and business tax filing services for Rocket Legal+ members (a total cost of $924.97) compared to Rocket Legal members (a total cost of $1,949.96). This is in addition to savings on the average cost of 5 hours for document preparation by a non-Rocket Lawyer network attorney at the average attorney hourly rate in the U.S. of $300 (an estimated cost of $1,500 when purchased without any form of Rocket Lawyer membership) compared to unlimited use of customizable business documents for both Rocket Legal+ and Rocket Legal members at no extra cost.

Yes – you do have to pay taxes for your new corporation. Before getting started, apply to the IRS for an employer identification number, or EIN. An EIN is similar to a Social Security number, but it's for businesses. All corporations with employees must have an EIN. You'll also need an EIN to open a corporate bank account.

Many business owners choose S-Corps because they're generally exempt from federal corporate income tax. C-Corps offer more flexibility because you can have several classes of shareholders with different voting rights, but there are tax implications.

New Mexico requires that you create certain corporate records to maintain your corporate status. Bylaws set forth your company's operating rules, and they define the responsibilities of your directors, the rights and powers of your shareholders, and address all other corporate matters. You don't have to file your Bylaws with the state, but you'll need them to demonstrate to banks, lending institutions, creditors, the IRS, and the courts that your corporation is valid and legitimate. Bylaws also help to establish rules so you can keep corporate assets and debts separate from your personal ones.

New Mexico also requires that corporations keep Minutes of director and shareholder meetings, as well as their most recent annual reports, a list of names and addresses of the directors and officers, the Articles of Incorporation along with any amendments, and their Bylaws at their corporate offices. Corporate Minutes keep track of all votes on important business decisions and help secure your corporate status. We have more specific information regarding New Mexico's requirements for Bylaws and Corporate Meeting Minutes.

We wish you success with your new New Mexico corporation! You can count on Rocket Lawyer for all the business, tax, and legal help you need at a price you can afford.

If you are planning to operate in another state, you may need to register a corporation in that state. Rocket Lawyer can help you determine which states you should register in.

Other states may have their own rules for foreign corporations that originate in New Mexico or domestic corporations that also operate in New Mexico. Talk to an attorney to understand the legal and tax requirements for the state(s) in which you plan to operate.