What are Corporation Bylaws?
In the event that you would like to dissolve your New Mexico corporation, there are a number of important steps you must follow to ensure it is done correctly. For starters, your corporation can be dissolved through two means: consent of shareholders or an act of the corporation.
If you are dissolving through consent of your corporation's shareholders, then written consent must be completed by the shareholders. Additionally, include a copy of that consent with your Statement of Intent to Dissolve by Written Consent of Shareholders. This statement of intent and accompanying filing fee must be filed with the New Mexico Public Regulation Commission.
If you choose to dissolve by an act of the corporation, a vote on a resolution to dissolve must take place among your shareholders. Similarly, a copy of the resolution to dissolve, a Statement of Intent to Dissolve by Act of Corporation, and accompanying filing fee should be filed with the Public Regulation Commission.
Once your statement is received and approved, your Statement of Intent will be returned with an endorsement from the Public Regulation Commission. Upon receipt, your corporation must cease business operations. Next, file Articles of Dissolution with the Public Regulation Commission along with clearances from the Tax and Revenue Department and Department of Workforce Solutions.
Steps to Dissolve Your New Mexico CorporationConsult Your Corporation's Bylaws
It is important that you follow the guidelines outlined in your corporation's bylaws pertaining to voluntary dissolution. A well-drafted set of bylaws will lay out the company's plan for dissolution including a vote by the shareholders and the proper distribution process for all remaining assets. However, if the bylaws your corporation adopted do not cover a voluntary dissolution scenario, then it is best to enlist the services of a lawyer to guide you through this process.File Initial Dissolution Documents
Next, you will want to sign and notarize your Written Consent of Shareholders to Dissolve and send it to the Public Regulation Commission along with your Statement of Intent to Dissolve by Written Consent of Shareholders and a $50 filing fee made out to the New Mexico Secretary of State. Then, it is important that you cease all business activities apart from those related to liquidation and distribution of remaining assets, as outlined in your bylaws. Following this step, there are several forms that you will need to complete and file. Those forms include:
- Corporate Dissolution or Liquidation, IRS Form 966 (send to IRS).
- Tax Clearance Request, ACD-31096 and Business Tax Registration Update, ACD-31075 (send both forms to the New Mexico Taxation and Revenue Department).
- Tax Clearance Request Form (send to Department of Workforce Solutions).
- Letter of Clearance (send to New Mexico Secretary of State).
Once your corporation has received all of its necessary supporting documentation, you are ready to submit your Articles of Dissolution. These will include documents from the Secretary of State, Taxation and Revenue Department, and Department of Workforce Solutions. Once all are received, you will send the entirety to the New Mexico Secretary of State's office. This will include:
- Articles of Dissolution (available on Secretary of State website)
- Certificate of No Tax Due (from Taxation and Revenue Department)
- Certificate of Compliance (from Department of Workforce Solutions)
- Letter of Clearance (from Secretary of State)
- $50 filing fee (made out to New Mexico Secretary of State)
Processing your Articles of Dissolution will take the Public Regulation Commission up to 15 business days. However, there are expedite processing options available for an additional $200 or $300 fee. Also, keep in mind that the Public Regulation Commission will not accept your submission if your corporation is not in good standing, which requires that all reports be filed, and all fees paid.Submit Your Corporation's Final Taxes
Even after your corporation has ceased all operations, it is important that you file taxes for the final year in which your corporation was dissolved. The best way to ensure a thorough and accurate dissolving is by consulting an experienced accountant or tax advisor. When you file your final tax return, make sure that the return indicates it is the corporation's “final return” in all appropriate areas of the form. Additionally, you will want to close your corporation's business account with the Internal Revenue Service. State your reason when notifying them and include a copy of your Employer Identification Number issuance. Make sure you accurately convey your corporation's name, EIN, and business address to avoid any delays.