Forming a New Mexico LLC

Attorney Lynn McKeever’s Preventive Practice approach to LLC Formation recognizes that a chartered legal entity can own land, insurance, business ventures, art, patents, copyrights, race horses, and just about anything else. In turn the LLC can be owned by individuals, trusts, and other companies.

These ownership arrangements can be useful in structuring estates, securing debts, and, most commonly, for charting business revenue flow and governance structures. A New Mexico LLC provides for a great variety of applications by the use of customized operating agreements.

Family Limited Companies

A Family Limited Company ("FLC") is becoming a popular way to share ownership of family assets without complicating the management structure. Here are some situations where the FLC works well:

High-risk professions. Assets of a professional at high risk of lawsuits can be transferred to the ownership of a private FLC.
Professional Management. A private FLC can hire a skilled professional to manage challenging investments like mineral rights, farms, family businesses, etc.
Gifting plans. Memberships in a FLC can belong to trusts for minors or disabled adults and income can be diverted to these lower tax bracket members.
Ownership of Life Insurance. Life insurance can be purchased and owned by a LLC and fund the buy-sell agreement between business partners.
Family Business Succession. When the elders of a family want to retire from the family business, but don't want to give up either ownership or ultimate control, a FLC can establish a systematic way of delegating management rights and responsibilities.
Co-ownership of undivided interests. Grandpa's ranch or Mother's patent is evidenced by a recorded written instrument. The FLC can be a title owner in which family members share rents and royalties.
Instead of or in addition to a family trust. The terms of the Operating Agreement of the FLC can allow changes at the times of events like death or incapacity that preserve the ability of the FLC to "carry on" without interruption.

Types of LLC Governance

Family businesses, closely held companies, and start-up entities are all taking advantage of the low maintenance costs and privacy of the New Mexico Limited Liability Company Act. This updated law allows flexibility in management, no annual fees, and privacy of ownership.

A New Mexico LLC can either be member-managed or manager-managed and it can elect to be taxed as a proprietorship, partnership, S-corporation or C-corporation. A New Mexico LLC can own assets in any other state and become qualified to do business almost anywhere.

Conversions and Mergers

Existing companies, both from New Mexico and other states, can convert to operating as a New Mexico limited company. Our law firm will draft Articles of Organization, Articles of Conversion, Articles of Merger and Articles of Dissolution. For out-of-state companies coming into the jurisdiction of New Mexico.

Operating Agreements

An Operating Agreement should be custom written to set out the purpose, anticipated duration, anticipated number of owners and manner of making management decisions. Attorney Lynn McKeever has drafted numerous operating agreements. Some are contracts between and among multiple owners and others a declarations by a single founder or owner that set out the anticipated growth and change of the company.

Lynn McKeever, JD

3636 Menaul Blvd. NE
Suite 101
Albuquerque NM 87110

(505) 991-1948

lynn@lynnmckeever.com

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