Starting a service business in New Mexico comes down to four things: picking a structure, registering with the state, getting licensed for your trade, and setting up a way to bill customers. Filing an LLC in NM costs $50, ongoing reporting is $0 (no annual report), sales tax is 5.125% GRT + local, and personal income tax runs 1.7%–5.9%. Below is the full sequence, the fees you should budget for, the licenses most trades need, and the deadlines that catch new New Mexico owners off guard.
Most new registrations come out of Albuquerque, Santa Fe — local business licenses are issued at the city or county level, so check yours after the state filing clears.
| Item | NM cost |
|---|---|
| LLC / entity filing (one-time) | $50 |
| Annual / periodic report | $0 (no annual report) |
| Federal EIN (IRS) | Free |
| Sales tax registration | Typically free |
| Trade / professional license | Varies by trade |
| Local business license | Set by city / county |
Fees change — confirm current amounts with the NM Secretary of State and the New Mexico Taxation and Revenue Department.
Choose your structure and file with the NM Secretary of State ($50). Get your free EIN from the IRS the same day.
Register for New Mexico sales tax with the New Mexico Taxation and Revenue Department, then open a business bank account under the registered name.
Apply for your trade license and local business license. This is usually the longest step: CRS ID for GRT; Professional license.
Get general liability insurance (and workers' comp before your first hire), then set up estimates and invoicing so you can bill the day you're cleared to work.
LLC Filing Fee
$50
Annual Report
$0 (no annual report)
Sales Tax
5.125% GRT + local
Income Tax
1.7%–5.9%
Choose business structure
File with NM Secretary of State
Get EIN
Register for Gross Receipts Tax
Get local permits
Open business bank account
No annual report required
New Mexico uses Gross Receipts Tax (GRT) instead of sales tax — applies to services too
Gross Receipts Tax — similar to sales tax but applies to services and most transactions.
Online LLC filings with the NM Secretary of State are typically processed in a few business days, and an EIN from the IRS is issued immediately online. Trade licensing and local permits usually take longest — plan on two to six weeks before you're fully cleared to work, depending on your trade.
No — you can operate as a sole proprietor in New Mexico and still invoice customers legally. An LLC ($50 to file, $0 (no annual report)) separates your personal assets from business liability, which matters most once you're on customer property, hiring help, or signing contracts.
New Mexico sales tax is 5.125% GRT + local. Materials and goods are commonly taxable, while labor treatment depends on the type of work, so bill parts and labor as separate lines and register with the New Mexico Taxation and Revenue Department before you start collecting.
Open a business bank account under the registered name, then invoice from a tool that applies NM tax per line item and accepts cards. Glo Invoice sends invoices by text with a one-tap pay link, and Tap to Pay lets you charge on site before you leave the job.