Starting a 501(c)(3) nonprofit in New Mexico is easy, just follow these easy steps:
If you’ve been thinking about starting a 501(c)(3) nonprofit in New Mexico, you have come to the right place. We have developed this comprehensive guide to help you not only start a nonprofit in New Mexico but also make it successful.
Step 1: Name Your New Mexico Nonprofit
The name you select for your nonprofit will establish its brand. It is the first thing most people will learn about your organization. It is important to pick a name that both aligns with your mission and follows the rules for naming in your state.
New Mexico Nonprofit Naming Guidelines
The name of you pick for your organization must:
- Not include words or phrases that imply the organization’s purpose is different than what is set forth in the Articles of Incorporation
- Be distinguishable from other businesses operating in the state of New Mexico.
The name need not include an organizational designation, such as “Inc.”, “Ltd.”, “Incorporated”, or “Company”
You can read the Nonprofit Corporation Act for the complete rules on naming a New Mexico-based organization.
To learn more, read our How to Name a Nonprofit in New Mexico guide.
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You may want to buy any URLs you are interested in, to make sure they are available when you are ready to finalize and create your website.
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Step 2: Appoint A New Mexico Registered Agent
A nonprofit corporation in New Mexico is required to have a registered agent with a New Mexico address.
What is a Registered Agent? A registered agent is an individual or business entity responsible for receiving important legal documents on behalf of your business. Think of your registered agent as your business' point of contact with the state.
Incfile provides the first year of registered agent service free with nonprofit formation ($49 + State Fees)
To learn more, read our How To Pick a New Mexico Registered Agent guide.
Step 3: Select Your Board Members and Officers
The directors of a nonprofit are responsible for overseeing the operations of the organization. The directors come together to form a board.
The officers of a nonprofit (such as the president or the secretary) are individuals with responsibilities, and the authority to execute based on their job descriptions.
Together, the officers and the board will come together to make up the organizational structure of your nonprofit.
The organization structure of your 501(c)(3) nonprofit in New Mexico MUST include:
- At least 3 directors not related to each other
- A president
- A secretary
To learn more, read our guide on How to Select Board Members for Your New Mexico Nonprofit.
Step 4: New Mexico Articles of Incorporation
To become a nonprofit corporation in New Mexico you must file DNP, the Articles of Incorporation for nonprofit corporations.
In order to qualify for 501(c)(3) status, the organization’s purpose must explicitly be limited to one or more of the following:
- Testing for public safety
- Fostering national/international amateur sports competition
- Preventing cruelty to animals/children
The Articles of Incorporation must be submitted by mail along with the following resources:
- Statement of Acceptance of Appointment by Designated Initial Registered Agent form
- Document Delivery Instruction
New Mexico Secretary of State
Business Services Division
325 Don Gaspar, Suite 300
Santa Fe, NM 87501
The filing fee is $25.
Personal checks or money order must be made payable to the "New Mexico Secretary of State"
To learn more, read our New Mexico Articles of Incorporation guide.
Step 5: File an Initial Report
Within 30 days of incorporation your organization must file an initial report with the secretary of state. This can be completed online through the Online Business Portal.
For more information, you can call the Corporations Bureau at (505) 827-4508, visit them at their website, or visit their office at the address found below:
Secretary of State
Chartered Documents Division
325 Don Gaspar, Suite 300
Santa Fe, NM 87501
Step 6: Register with the Attorney General
Before soliciting for funds and within 30 days of formation, you must register with the New Mexico attorney general online.
For more information, you can contact the Office of the Attorney General at (505) 827-6000 or visit them at their website.
Step 7: Draft Bylaws and Conflict of Interest Policy
There are two documents that will be central to the running of your nonprofit:
Bylaws: These are the rules that determine how your organization will be governed and run.
Conflict of Interest Policy: These are the rules set to ensure that decisions being made for the nonprofit are based on what is best for the organization, and not being motivated by what is best for individuals.
Step 8: Conduct an Organizational Meeting
An organizational meeting is the first official meeting of your nonprofit! Some of the things that are discussed in a typical organizational meeting:
- Taking attendance to show you have a quorum (minimum number needed)
- Appointing temporary officers, chairmen, secretaries, etc.
- Adoption of the bylaws
- Adoption of conflict of interest policy
Don’t forget to record “minutes” of the meeting and have it signed by all attending directors. Here are some corporate minutes templates to help you get the ball rolling.
Step 9: Get an EIN
An EIN or Employment Identification Number (also called a Federal Tax Identification Number or Federal Employment Identification Number), is used to uniquely identify a business entity. You can think of the EIN as a social security number for your nonprofit.
The EIN is required for your organization whether or not it will have any employees.
To learn more, read our guide on how to get your EIN.
Step 10: Register for a State Tax Account
Once you obtain your EIN, you must also register with the New Mexico Taxation and Revenue Department.
Taxation and Revenue Department
Manuel Lujan Sr. Building
1200 South St. Francis Drive
P.O. Box 5374
Santa Fe, NM 87502-5374
For more information, you can call the Taxation and Revenue Department at (505) 827-0951 or visit them at their website.
Step 11: Applying for Exemption from Federal (501(c)(3) status) and State Taxes
Applying for Exemption from Federal Taxes:
A nonprofit may be eligible for 501(c)(3) status only if its purpose is limited to one or more of the following:
Charitable, Religious, Scientific, Educational, Literary, Fostering national/international amateur sports competition, Preventing cruelty to animals/children, Testing for public safety
Before a nonprofit can apply for 501(c)(3) status it must:
- Elect at least 3 directors not related to each other
- Register as a nonprofit with the state
- Adopt the bylaws and conflict of interest policy
- Have an EIN number
Once these four conditions have been met your nonprofit can apply for 501(c)(3) tax-exempt status by filing Form-1023 online.
If your application is approved, the IRS will send you a determination letter stating that your organization is exempt from federal taxes under section 501(c)(3).
To learn more, read our guide on How to File Form 1023-EZ.
Applying for Exemption from State Taxes:
Once you have received your 501(c)(3) determination letter from the IRS, your organization will automatically be exempt from corporate income tax.
Gross Receipts Tax:
Many nonprofit corporations in New Mexico will be subject to Gross Receipts Taxes. Typically, the only organizations exempt from paying gross receipts taxes are those corporations that are deemed educational or social organizations in their IRS Determination Letter.
To learn more about the Gross Receipts Tax, read the Brochure for Nonprofits and Gross Receipts Tax for Nonprofits documents provided by the New Mexico Taxation & Revenue Department.
For more general information, you can call the Taxation and Revenue Department at (505) 827-0951 or visit them at their website.
Once you have formed your New Mexico nonprofit, we recommend you read our guide on How To Protect your New Mexico Nonprofit and Keep It Compliant.
Step 12: Open a Nonprofit Bank Account
After you acquire an EIN and a federal tax exemption for your nonprofit, you can open a 501(c)(3) bank account to begin soliciting donations or paying vendors and employees of the organization.
Opening a bank account for your nonprofit is the first step towards creating a paper trail of all income and expenses to show the IRS that your nonprofit is legitimate, honest, and legal.
There are several rules and exceptions that differentiate a 501(c)(3) bank account from a traditional business account. To find the best bank for your organization's financial needs read our review of the best banks for small business.
Step 13: Get Insurance for your Nonprofit
A nonprofit has assets and can be the subject of legal action or suffer financial damages from accidents, just like a regular business.
We recommend Commercial Insurance to protect your organization from lawsuits and damages.