Which is Better, an LLC in Delaware or New Mexico?

In this article we'll compare whether an LLC in Delaware or New Mexico is a better option for forming an LLC. We'll look at the similarities and differences in pricing and features with this data-driven guide. Choose which state is best for your needs with side-by-side comparisons.

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Recommended Option for Most Businesses

In broad terms, it is usually better to form your LLC in the state you are based in, or plan to conduct your business in. The reason for this is because there is slightly less paperwork involved, and you can save money on the formation fees.

If you live in Delaware or New Mexico and most of your business will be conducted there, it's probably best for you to form your LLC there too.

However, if you are not based in the USA, or you are looking for a more tax-efficient option, you may want to consider forming your LLC in a different state.

If that sounds more like what you are looking for, keep reading and we'll break down the differences between Delaware and New Mexico.

This article is for educational purposes only. Please make sure you consult an attorney before making any decisions about where to form your new business.

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Pricing

Every state has different fees for forming an LLC. The table below breaks down the approximate fees for Delaware and New Mexico. We have also worked out the average filing fee for all states so you can see how Delaware and New Mexico compare to the rest of the country.

Country average Delaware New Mexico
Filing fee $133 $90 $50
Renewal fee $80 $300 $0
Renewal period (years) 1 1 0

When factoring in the costs, you might also want to consider an inexpensive formation service like ZenBusiness or Incfile. These services can help you form your LLC for a fraction of the cost of a lawyer or accountant.

They also both provide a Registered Agent service, which is a requirement in both Delaware and New Mexico. This is a service that will receive any legal documents on your behalf, and forward them to you.

Feature Comparisons

Beyond the pricing differences, we can also look at the different features or filing options that Delaware and New Mexico offer to see how they compare to each other. This is a really great way to see, side-by-side, what each state offers so you can determine which is best for your company formation needs.

Feature Delaware New Mexico
File by mail
File online
Online approval time Unknown 72 days
Expedited filing
Expedited approval time 24 hours Not available
Expdited filing fee $50 Not available
Max. corporate tax rate 8.7% 5.9%
Delaware guide New Mexico guide

Conclusion

Hopefully, being able to see Delaware vs New Mexico side-by-side has helped you to determine which state is better to form your LLC in.

The general rule of thumb is that you should file in your home state unless you have good and valid reasons for doing otherwise. If you are still looking at Delaware or New Mexico, then make sure to look at the pricing options, filing options, approval times and corporate tax rates to see which might be favorable to you.

The limited liability protections of each state are reasonable similar so it's really a case of personal preference, looking at the fees of each, and considering your business type (i.e if you are a franchise, certain states have lower tax rates available).

Ultimately, make sure to consult an attorney before making any decisions. It might be that Delaware and New Mexico are both good options for you, but you might also find that neither works for your needs.

The only way to truly decide whether an LLC in Delaware or an LLC in New Mexico is right for you is to consult with your attorney.