How to Dissolve an LLC in New Mexico? (Full Guide)

If your New Mexico LLC is no longer active or economically viable, you need to dissolve it properly to avoid ongoing tax obligations and legal liability.

As a tax attorney who has guided over 30 business owners through LLC dissolutions in the past 7 years, I can walk you through each step of the New Mexico dissolution process.

I will cover everything from the member vote to filing Articles of Dissolution with the Secretary of State, ensuring you close your business cleanly and in full compliance with state law.

Quick Summary

• To dissolve an LLC, consult the operating agreement, close all tax accounts, and file the Articles of Dissolution with the Secretary of State.
• Before proceeding with the dissolution, notify all entities that have an interest in the company, including clients and creditors.
• Between March 2023 and March 2024, small businesses accounted for 6,468 closings in New Mexico, according to the 2025 U.S. Small Business Administration State Profile.
• Properly dissolving an LLC protects you from ongoing tax liabilities and potential lawsuits from creditors.

6 Steps to Dissolving an LLC in New Mexico

To dissolve an LLC in New Mexico, notify all creditors about the company's dissolution and settle outstanding obligations.

With New Mexico home to 172,113 small businesses representing 99% of all businesses in the state according to the 2025 U.S. Small Business Administration State Profile, understanding the dissolution process is essential for business owners exiting this active market [1].

Here are the correct steps to follow.

Step 1: Vote to Dissolve the LLC

Before starting the dissolution process, review the LLC’s operating agreement, which outlines the specific provisions for dissolution, including voting requirements.

Convene a meeting with all LLC members to vote on the dissolution. The operating agreement will determine the number of votes required for approval, which can be either a simple majority or a supermajority.

In the absence of an operating agreement, New Mexico state laws apply.

If you are unsure where to find your operating agreement, you can typically request a copy from your New Mexico registered agent.

Step 2: Notify Creditors About Your LLC's Dissolution

New Mexico law requires LLCs to notify creditors as part of the dissolution process.

This ensures that the company fulfills its legal obligations and avoids potential legal repercussions, such as lawsuits from creditors who were not properly informed.

Between March 2023 and March 2024, small businesses accounted for 6,468 closings in New Mexico according to the U.S. Small Business Administration, highlighting the importance of properly concluding all business activities.

The notification allows creditors to present their claims against the LLC.

Step 3: File Final Tax Returns and Obtain Tax Clearance

Submit a final return and close all tax accounts, including unemployment insurance tax, employee withholding tax, and gross receipts tax.

This qualifies you to obtain tax clearance from the New Mexico Taxation and Revenue Department.

"As of late 2024, the New Mexico Secretary of State requires all business filings to be submitted online; paper filings are no longer accepted."

-Jon Morgan, Co-Founder & Chief Editor of Venture Smarter

If you want to be certain that all of your New Mexico LLC's tax accounts are properly closed, you may need to seek a professional to deal with the process on your behalf.

Step 4: File Articles or Certificate of Dissolution

File Articles of Dissolution with the New Mexico Secretary of State to officially dissolve your LLC.

The form can be found on New Mexico's official online portal (enterprise.sos.nm.gov) and must be completed in full before submission.

A filing fee of $25 must be paid to have the Articles of Dissolution processed. It takes 10-15 days to process the document, after which your company will be officially dissolved [2].

Step 5: Distribute Assets

The distribution of assets should be in line with the provisions outlined in the LLC's operating agreement. This document typically specifies how assets should be allocated among members.

Following these guidelines ensures a fair and agreed-upon distribution, minimizing disputes.

Proper distribution of assets ensures that all members receive their fair share based on their investment or ownership stake in the LLC.

This equitable treatment is crucial for maintaining trust and goodwill among members, especially in a dissolution scenario.

Step 6: Close All Accounts and Cancel Licenses and Permits

Close all business accounts, including bank accounts, credit lines, and merchant services, to finalize the LLC's financial affairs. This step prevents any further financial activity or transactions that could complicate the dissolution process.

Canceling any licenses, permits, or registrations held by the LLC is a legal requirement. This step is necessary to inform regulatory bodies that the LLC is no longer in operation and to ensure compliance with state and local laws.

What Happens if You Don't Formally Dissolve Your New Mexico LLC?

If you skip formal dissolution, New Mexico may administratively revoke your LLC for non-compliance. This leaves your business in "revoked" status on state records, which can affect your ability to form new businesses or obtain licenses [3].

I have worked with clients who assumed their inactive LLC would simply "disappear," only to discover years later they owed back taxes and penalties.

If revoked, you have 2 years to apply for reinstatement; after that, you must form a new LLC. I always recommend filing Articles of Dissolution to ensure a clean legal break.

FAQs

References:

1. https://advocacy.sba.gov/wp-content/uploads/2025/06/New_Mexico_2025-State-Profile.pdf
2. https://www.tax.newmexico.gov/businesses/close-my-business/
3. https://www.law.cornell.edu/regulations/new-mexico/N-M-Admin-Code-SS-12.3.4.11