How to Dissolve an LLC in New Mexico: Complete 2026 Guide

How to Form an LLC: Step-by-Step

1. 1

   Vote to Dissolve

   Review your LLC's operating agreement to determine the voting requirements for dissolution. If no specific provisions exist, New Mexico law requires consent from members owning more than 50% of the membership interests. Document this decision in a formal resolution that includes the dissolution date and reason for closing.

   Pro tip: Keep detailed records of the dissolution vote, including dates, member signatures, and percentage of ownership that approved the decision. You'll need this documentation for tax filings and potential future inquiries.
2. 2

   File Articles of Dissolution with the New Mexico Secretary of State

   Submit the Articles of Dissolution form to the New Mexico Secretary of State with the $25 filing fee. You can file online at https://www.sos.nm.gov or by mail. The form requires basic information about your LLC, the dissolution date, and confirmation that all debts and obligations have been satisfied. Processing time varies based on current workload.

   Pro tip: File online for faster processing and immediate confirmation. The New Mexico SOS typically processes online filings more quickly than mail submissions.
3. 3

   Notify Creditors and Settle Debts

   Provide written notice to all known creditors about your LLC's dissolution. New Mexico statute requires you to give creditors a reasonable time to submit claims, which varies by state statute. Pay all outstanding debts and obligations before proceeding with the dissolution process. This includes settling accounts with vendors, lenders, and service providers.

   Pro tip: Send creditor notices by certified mail to create a paper trail. Keep copies of all correspondence and payment confirmations to prove debts were properly settled.
4. 4

   Close New Mexico State Tax Accounts

   CRITICAL: New Mexico REQUIRES tax clearance before dissolution is finalized. Obtain a tax clearance certificate from the New Mexico Taxation and Revenue Department by filing all required tax returns and paying outstanding franchise taxes. File your final New Mexico tax return and close all state tax accounts including gross receipts tax, withholding tax, and unemployment insurance accounts.

   Pro tip: Start the tax clearance process early as it can take several weeks. The Secretary of State will not finalize your dissolution without this certificate from the Taxation and Revenue Department.
5. 5

   Cancel Your EIN with the IRS

   Close your federal tax accounts by sending a letter to the IRS Cincinnati office stating that your LLC is dissolved and you want to cancel the Employer Identification Number (EIN). Include your LLC's legal name, EIN, business address, and dissolution date. File your final federal tax return (Form 1065) and any required final employment tax returns.

   Pro tip: Send your EIN cancellation letter via certified mail and keep a copy for your records. The IRS doesn't have an online process for EIN cancellation, so a written letter is required.
6. 6

   Distribute Remaining Assets to Members

   After paying all debts and obligations, distribute the remaining LLC assets to members according to their ownership percentages as outlined in your operating agreement. If no agreement exists, distribute assets proportionally based on each member's capital contribution. Document all distributions with written records and obtain receipts from receiving members.

   Pro tip: Consider the tax implications of asset distributions. Some distributions may be taxable events for members, so consult with a tax professional before finalizing distributions.
7. 7

   Confirm Dissolution is Complete

   Verify that the New Mexico Secretary of State has processed your Articles of Dissolution and that your LLC status shows as 'dissolved' in their business database. Retain all dissolution documents, tax clearance certificates, final tax returns, and asset distribution records for at least seven years as required by IRS and New Mexico record retention guidelines.

   Pro tip: Download or request a certified copy of your dissolution filing from the Secretary of State's office. This official document proves your LLC was properly dissolved if questions arise in the future.

Winding-Up Checklist

• Cancel all New Mexico business licenses and permits

  Contact each licensing agency to formally surrender your business licenses and avoid ongoing renewal fees or compliance requirements.

• Close business bank accounts

  Withdraw remaining funds, cancel automatic payments, and request written confirmation from your bank that all accounts are closed.

• Cancel business insurance policies

  Notify insurance providers of your dissolution date and request refunds for any prepaid premiums beyond the closure date.

• Notify vendors, suppliers, and customers in writing

  Send formal notices explaining your business closure, final billing procedures, and contact information for any ongoing matters.

• File final payroll tax returns and W-2s (if you had employees)

  Submit final quarterly payroll tax returns to the IRS and New Mexico, and distribute W-2 forms to employees by January 31st.

• Retain business records per New Mexico retention requirements

  Keep tax returns, financial statements, contracts, and dissolution documents for at least seven years in case of audits or legal inquiries.