How to Keep Your New Mexico Nonprofit Compliant

Once you form a 501(c)(3) Nonprofit Public Charity in New Mexico, follow this guide to keep it in good standing.

(Read our guide to learn how to form a nonprofit in New Mexico.)


Or, simply use a professional service:

Incfile Nonprofit Incfile (Starting at $0 + State Fees)

And, read our best nonprofit formation services review on Startup Savant.


1. Apply for exemption from state taxes

A. State Income Tax Exemption

Once your organization receives your 501(c) determination letter from the IRS, your nonprofit will automatically be exempt from paying corporate income taxes. 

You may wish to register with the New Mexico Taxation and Revenue Department, which will prove helpful if you wish to apply for a Gross Receipts Tax Exemption (below). To register for state tax accounts, fill out form ACD-31015 on the Taxation and Revenue Department’s website or register online.


B. Gross Receipts Tax Exemption 

Most New Mexico nonprofits will be required to pay Gross Receipts Taxes. The only organizations that are typically exempt from paying gross receipts taxes are educational or social organizations.

To read 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.

2. Annual Federal Returns for Tax-exempt organizations

A. Annual Federal Returns

Most tax-exempt nonprofit organizations are required to file an annual return with the IRS (Check the IRS website for a list of exceptions).

The annual gross receipt amounts for an organization determine which form should be used to file the annual federal return.

‘Gross receipt’ is defined by the IRS as “the total amounts the organization received from all sources during its annual accounting period, without subtracting any costs or expenses”

For gross receipts ≤$50,000 --- File 990-N
Gross receipts <$200,000 and total assets <$500,000 --- File 990- EZ
Gross receipts >$200,000 or Total assets >$500,000 --- File 990


For any questions, contact the IRS at

  • (800) 829-3676 (Form related questions)
  • (800) 829-1040 (general information)

FAQ

Q: When is form 990 due?
A: Form 990 is due on the 15th day of the 5th month after the taxable year of the organization comes to an end.

E.g. If the taxable year ends on Dec 31st, form 990 is due on May 15th.

NOTE: If an organization fails to file form 990 for 3 consecutive years, it will automatically lose tax-exempt status.


B. Unrelated Business Income

If an organization has a gross income of ≥$1000 from a trade or business that is not related to the stated purpose of the organization, then it must file Form 990-T to pay tax on that income.

If your organization expects to pay $500 or more for the year in taxes on unrelated business income, your organization must pay a quarterly estimated tax on the unrelated business income using Form 990-W.

3. Maintain a Registered Agent

Any nonprofit that has incorporated must have a registered agent who has an office address in New Mexico. If your registered agent, or their office address, changes, you must notify the Secretary of State so that your Articles of Incorporation may be updated. Business information updates, like registered agent changes, can be made through the Secretary of State’s Online Business Portal.

If you fail to notify the Secretary of State of this change, your corporation may be subject to termination.

4. File Periodic Reports

New Mexico nonprofits need to file up to two reports every year:

  1. Annual Report with the New Mexico Secretary of State - Within four and a half months after the end of your organization’s fiscal year, you must file an annual report. Annual Reports may be filed online through the Secretary of State’s Online Business Portal.
  2. Annual Report with the New Mexico Attorney General - Charitable nonprofits are also required to file an annual report with the New Mexico Attorney General. These reports may be completed online and they are due each year within 6 months of the end of your organization’s fiscal year. 

Failure to file the appropriate reports may subject your organization to termination.

5. Apply for Permits and Licenses

The majority of New Mexico nonprofits will not need a general business license at the state-level. You may want to check with your city or county clerk to determine if there are local requirements you must follow.

If your nonprofit plans to host charitable games like bingo or raffles, you’ll need to obtain a license from the New Mexico Gaming Control Board. Access more information about charitable gaming licenses and the application form on the Gaming Control Board’s website.

6. Charitable Registration

Charitable New Mexico nonprofits are required to register with the New Mexico Attorney General prior to soliciting contributions or within 30 days of forming your nonprofit. This registration, and subsequent renewals, can easily be completed online through the Attorney General’s website.

7. Employees

If your nonprofit will have employees, you will need to register with the New Mexico Department of Workforce Solutions and the New Mexico Taxation and Revenue Department. 

Nonprofits can register online for unemployment taxes through the New Mexico Department of Workforce Solutions. Nonprofits can register online for withholding and workers compensation taxes through the New Mexico Taxation and Revenue Department.

8. Comply with Public Inspection Rules

To comply with federal regulations regarding 501(c)(3) charities, you will need to release the following documents to any member of the public that requests them:

  • Your organization’s annual returns for up to 3 years after the listed due date (including the following Forms: 990-PF, 990-EZ, 990-T, and 990)
  • Any supporting documents and attachments for the above 990 forms. However, you only need to include the nature of the contribution and the amount contributed for Schedule B.
  • Official IRS paperwork showing your organization is considered to be tax-exempt.
  • Your organization’s application for exemption and all supporting documents submitted with your application (including Form 1023).


Your organization does NOT need to share the following documents and information with members of the public:

  • Any portion of Form 990/990-EZ’s Schedule B that identify who contributors are.
  • Anything considered to be an unfavorable ruling, which can include previous denials of tax-exempt status.
  • Any additional information permitted to be withheld by the IRS, including things such as trade secrets, patents, etc.

Recommended: Inform your employees about their rights and stay compliant by posting labor law posters in your workplace.

FAQ

Q: Can I charge members of the public for copies?
A: Yes, you are permitted to request a reasonable amount to procure copies of requested documents.

Q: If requested, how much time do we have to produce the documents?
A:
It is ideal to produce these documents within the same working day. However, if your nonprofit has limited office hours due to the time of year, or you don’t have a physical office at all, you should produce the documents within 14 days.

Q: Do I actually need to provide physical copies of the requested documents?
A: If a member of the public as for copies of documents, whether in writing or in person, you are required to make them available.

NOTE: We recommend that nonprofits make these documents available on their website. That way, anyone who might request copies of these documents can simply head to your website to view and/or download them. This will help your organization remain compliant and save time dealing with these requests personally.

To learn more about forming a nonprofit, check out our How to Start a Nonprofit in New Mexico guide.

Related Articles