How to Dissolve an LLC in New Mexico in 7 Steps

How to Dissolve (Close) an LLC in New Mexico

Written by:

Carolyn Young has over 25 years of experience in business in various roles, including bank management, marketing management, and business education.

Reviewed by: Sarah Ruddle

For over 15 years, Sarah Ruddle has been a noteworthy leader in the business and nonprofit world.

How to Dissolve (Close) an LLC in New Mexico

How to Dissolve (Close) an LLC in New Mexico

If you have a limited liability company (LLC) in New Mexico, at some point, you may need to shut down the business at some point. Maybe you’ve started another company or decided to relocate to another state — whatever the reason, you’ll need to follow the somewhat complicated LLC dissolution process. 

If done incorrectly, you’ll still be responsible for annual reports and fees and could face additional penalties. But, lucky for you, this handy guide explains how to dissolve an LLC in New Mexico. 

Properly shutting down an LLC involves several crucial steps, as detailed below.  

1. Vote for Dissolution

LLC owners, known as members, must vote to dissolve the LLC. Hopefully, you have an operating agreement that details the process. If not, New Mexico law requires written consent of all members or a district court order at the application of one of the members. Once this occurs, draft a resolution to dissolve the LLC and keep it in records. 

2. Cancel Business Licenses and Permits

If you were required to get licenses and permits for your business, you’d need to contact the issuing agencies to cancel them so that you’re not charged renewal fees. If you have any outstanding fees, you’ll likely need to pay them before you are allowed to cancel.

3. Notify Creditors

If you owe money to any creditors, you’ll need to notify them in writing of the dissolution and give them detailed instructions on filing any claims for the outstanding debt. In New Mexico, claims must be filed by the deadline specified in the notice, which must be at least 120 days from receipt of the notice. 

In New Mexico, this must be done before you formally dissolve your LLC with the state.

4. Notify Tax Departments

Notify any relevant tax authorities of the dissolution and pay any outstanding taxes due.

5. Cancel Contracts and Settle Financial Obligations

If you have contracts with vendors, lessors, or any other outstanding financial obligations, you’ll need to ensure all your obligations are fulfilled and all contracts are canceled. 

6. Distribute Assets to Members

If the LLC has any assets remaining in any form after all financial obligations have been settled, they must be distributed to members based on LLC ownership percentages. If the assets are equipment, property, or other non-cash assets, they’ll need to be sold first so distributions can be made in cash. 

7. File the Dissolution Papers with New Mexico

In New Mexico, the process to officially dissolve your LLC is to download the articles of dissolution form, fill it out, and file it by mail.

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The mailing address is:

New Mexico Secretary of State
Business Services Division
325 Don Gaspar, Suite 300
Santa Fe, NM 87501

The fee for filing the dissolution papers in New Mexico is $25.

In Closing

Regardless of the reason, LLC dissolution must be done right to avoid legal issues and financial penalties. Therefore, it’s highly recommended that you employ the services of an attorney to ensure everything is done correctly and all bases are covered.

FAQs

How much does it cost to dissolve an LLC in New Mexico?

The fee for filing articles of dissolution in New Mexico is $25.

How long does it take to dissolve a New Mexico LLC?

The processing time for articles of dissolution in New Mexico can be up to 15 days.

Should I close an unused LLC in New Mexico?

If you have no plans to operate your New Mexico LLC in the future, you should dissolve the LLC. However, you’ll still be responsible for annual reporting and fee requirements if you don’t.

What happens if I don't dissolve my LLC in New Mexico?

You will remain responsible for all your LLC’s filings and fees. If you don’t keep up with them, penalties may accrue.

What is the difference between the dissolution and termination of an LLC in New Mexico?

Dissolution begins with the triggering event, such as a vote of members per the operating agreement. Termination is when all LLC activities stop, including winding up affairs and filing dissolution paperwork with the state. The filing of those documents finally terminates the LLC.