How to Set Up a DBA in New Mexico
A DBA (Doing Business As) allows individuals and businesses to operate under a different name or expand their brand presence while maintaining legal compliance. In this guide, we’ll walk you through the step-by-step process of setting up your DBA in New Mexico.
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Ready to start a New Mexico business? The arid temperatures and stark landscapes make the state a natural wonder, but it also has a friendly business landscape. If you plan to launch a business, you may want to file a new DBA so your business can use a company name as opposed to your own name. However, New Mexico is one of a handful of states that does not register DBAs at the state level or county level. So, what should your small business owners do? Is there another option? Read on to see if there’s another option for your business.
A DBA is an acronym for “doing business as,” sometimes known as a fictitious name, trade name, or DBA name, depending on which state you live in. In simple terms, a DBA is just another name you can use for your business.
Sole proprietors can benefit from using a DBA because instead of using their personal name to run their business, they can use a DBA to operate under a different name.
However, New Mexico does not register any DBAs in the state.
Besides a DBA, what are your other options?
New Mexico does register other types of businesses, just not DBAs, trade names, or fictitious business names.
If you want to run your business under a different name than your own name, you can establish a different kind of business entity, like a:
- Limited liability company
- For-profit corporation
- Not-for-profit corporation
- Limited partnerships
All of these business entities are required to register with the state.
Without the ability to register a DBA, many entrepreneurs will lean toward setting up an LLC. It’s the next easiest option.
How to search for available business names in New Mexico
If you decide to register an LLC in the state, you need to pick the name of the business first. While that might sound simple, it might be harder than you think.
No two businesses can have the same name. Before you register, each business owner must check on name availability to ensure an original name.
Follow these steps to pick an available name in the state of New Mexico:
Think of a name first
Come up with a list of potential names for your startup. Try to brainstorm a few names, not just one. As mentioned, you need to see if the name is available. If your top choice is already in existence, it’s good to have additional options ready.
Search for business name availability
Visit the New Mexico Secretary of State website and use the business name search tool to see if the name you want is already in use.
Check the results
Did your search return a match? If so, it means there’s a business in New Mexico with that name. As a result, you can’t use the name. The state does not allow two businesses to have the same name. You need to pick another name.
The state won’t allow you to make a name plural or adjust the name’s spacing to make it unique either. Every business name must be distinguishable, which eliminates the possibility of getting two businesses mixed up.
Have a name in mind? Check on name availability first here.
How to register an LLC in New Mexico
New Mexico does not have a DBA filing process. You can, however, register an LLC with the state. Doing so gives you the ability to register a business name, and it also provides additional safeguards, like limited liability protection for your personal assets.
To register an LLC in New Mexico, follow the directions below.
Pick a unique business name
Your business name must be available, which means no other business is currently using it.
If it’s not available and you try to register your LLC, your application will be rejected. Review the naming rules above before you move on to LLC formation documents.
Pick a registered agent
To establish an LLC, you need to list a registered agent on your LLC formation paperwork. A registered agent serves as the point of contact for the company. This person would receive important documents like tax notices or services of process papers served during a lawsuit.
A registered agent plays an important role, so you should choose someone you trust. You can also use a professional registered agent service to fill the job. For a small annual fee, a commercial registered agent will collect notices and notify you of any deliveries.
File your Articles of Organization
The official LLC formation documents are called Articles of Organization. You can find the documents on the New Mexico Business Portal.
You need to create an account through the portal to file the documents.
You’ll be asked to provide a few pieces of information, like the company name, the name of the registered agent, addresses, and contact information. You can fill them out electronically and submit them. You can also print them, and mail or hand deliver them, but filing online is the fastest option.
Pay the filing fee
Each state charges a filing fee to form an LLC. New Mexico charges $50. You can submit your payment online when you submit your Articles of Organization via debit or credit card.
Wait for the application to be processed
The state will review your documents in a week or less. If there are any problems, you’ll be notified. If, for example, you chose a name that an existing business goes by, the application will be rejected.
Ready to register your DBA? Fill out these forms.
Running an LLC can be a challenge. There’s a lot to do. From creating a website to exploring business licenses, use this checklist to make sure you’ve got everything ready to go:
Obtain an EIN
If you registered an LLC, you’d likely need an EIN. An employer identification number is used to pay federal taxes and is issued by the IRS. Aside from tax purposes, your small business needs an EIN to pay employees and open a business bank account too.
The IRS will issue this number to you online. Your business will keep this number for its lifetime. Think of it as a social security number for your business.
If you plan to get an EIN, you can do so on the IRS website.
Open a business bank account
With an EIN in hand, you can open a business bank account. Why is that important? No matter how much money your business brings in, you should keep your personal finances separate from your business expenses.
When you file taxes, you need to know how much money you make and your business expenses. If everything is separated and goes through one bank account, it’s easy to figure out.
While you open a checking account, you could also open a savings account to set aside money for big purchases or to pay quarterly taxes.
Get business permits and licenses
Many small businesses need business licenses and permits. Some are issued by the state, but in New Mexico, most are issued by the county. Check with your county clerk’s office to see if your business needs any permits or licenses.
Get a website up and running
In the craze of setting up a business, don’t overlook the importance of a website. You need to buy a domain name first, and then you can design a site. Don’t have any design skills? There are drag-and-drop builders that are userfriendly. You could also look for a website designer on a freelance site like Upwork.
Maintain your LLC
Most states require LLCs to file an annual report to keep their registered business in compliance. However, in New Mexico, companies aren’t required to file annual reports, but you must file New Mexico income tax. You can learn more about it on the state’s taxation website.
Understand New Mexico tax laws
When you run a business, paying taxes is slightly different than just filing your personal return. You need to get a handle on everything from sales tax to income tax, so it’s best to talk with an accountant in New Mexico so there aren’t any surprises come tax time.
Keeping your personal and business finances separate will ease stress during this time.
In states other than New Mexico, who typically sets up a DBA?
A DBA is best for a sole proprietorship that wants to operate or do business under a different name other than its legal name. For sole proprietors, a DBA allows them to work under an assumed name of your business without having to file or open a separate LLC business structure.
Note that a DBA differs from an LLC or any other business entity. While your LLC is a formal business structure, a DBA is just another name your business can operate under.
Since New Mexico does not register DBAs, you’ll need to set up a different type of business.
What are the benefits of registering an LLC in New Mexico?
One of the biggest perks of an LLC is its personal liability protection. It separates your personal assets from your business assets. In the event of bankruptcy or a lawsuit, your personal assets aren’t used to cover business debts.
Can small businesses in New Mexico hire employees?
Absolutely. You can hire employees, but you’ll need an EIN to pay them and file the proper taxes. The IRS issues EINs online. It’s a nine-digit number that stays with your LLC throughout its existence.
Are sole properitorships registered in New Mexico?
Sole props aren’t registered in New Mexico, nor are DBAs.
Why aren’t DBAs registered with the state?
New Mexico doesn’t have a DBA registration process. However, other business entities, like an LLC, need to register with the state.
Are New Mexico LLCs required to file annual reports?
No. LLCs don’t have to file an annual report. They must file state taxes, but there isn’t any annual compliance measure required by the state.
Is a DBA from another state recognized in New Mexico?
No. If you plan to do business in New Mexico, you should select a business entity that the state recognizes, like an LLC. There is no DBA filing process for new businesses in the state.
Find out how to set up your DBA
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