New Mexico vs Nevada: Side-by-Side Comparison
Here's a comprehensive comparison of the two states across all key factors for non-resident LLC formation:
| Feature | New Mexico | Nevada |
|---|---|---|
| Income Tax | 1.7%–5.9% | None |
| Corporate Tax | 4.8%–5.9% | None |
| Sales Tax | 5.125% GRT | 6.85% |
| Annual Fee | $0 | $350 |
| Formation Fee | $50 | $75 |
| Privacy | Complete anonymity | No member disclosure, no IRS sharing |
| Court System | Standard state courts | Standard state courts |
| Asset Protection | Moderate | Strong |
| Best For | Maximum anonymity, zero maintenance | Privacy-focused, no-tax entities |
Tax Comparison
New Mexico Taxes
- Personal Income Tax: 1.7%–5.9%
- Corporate Tax: 4.8%–5.9%
- Sales Tax: 5.125% GRT
Nevada Taxes
- Personal Income Tax: None
- Corporate Tax: None
- Sales Tax: 6.85%
For non-resident entrepreneurs with single-member LLCs treated as disregarded entities, state income tax typically only applies if you have income sourced within that state. If you have no in-state operations, employees, or customers, state income tax may not apply regardless of which state you form in.
Formation & Annual Costs
| Cost | New Mexico | Nevada |
|---|---|---|
| Formation Fee | $50 | $75 |
| Annual Fee | $0 | $350 |
| Registered Agent (est.) | $100–$300/year | $100–$300/year |
| Estimated Year 1 Total | $200 (with RA) | $575 (with RA) |
Privacy & Asset Protection
New Mexico
- Privacy: Complete anonymity
- Asset Protection: Moderate
- Court System: Standard state courts
Nevada
- Privacy: No member disclosure, no IRS sharing
- Asset Protection: Strong
- Court System: Standard state courts
The Verdict: New Mexico or Nevada?
New Mexico offers better anonymity (no member/manager in any public records) at a fraction of the cost ($50 formation, $0 annual). Nevada has no income or corporate tax but costs $350/year. For non-residents with no in-state income, NM's state taxes don't apply, making it effectively tax-free with better anonymity. Nevada's advantage is stronger asset protection and no IRS information sharing. New Mexico saves over $400/year compared to Nevada.
Our Recommendation
New Mexico for cost and anonymity; Nevada for asset protection and guaranteed no state tax
Remember that regardless of which state you form your LLC in, your federal tax obligations remain the same. All foreign-owned single-member LLCs must file Form 5472 and a pro forma Form 1120 annually, with a $25,000 penalty for non-compliance.
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