Steps to Starting a Business

Congratulations! You’ve made the important decision to start your own business. Before you can set up shop, there are a few steps you must take to comply with the laws of the State of New Mexico and the US federal government.

Make a plan. Studies show that business owners who take the time to plan their business  have a higher rate of success. You wouldn’t start on a long-distance road trip without a road map so why would you start a business without a similar plan? Not sure how? Follow the links to articles with more information.

Minimize Risk and Maximize Success with a Business Plan
New Year, New Business Plan
Knowing Marketplace Needs Crucial to Writing a Business Plan
Avoiding the Most Common Business Plan Mistakes

Check for trademarks. Trademark infringement can carry a high cost for your business. Before you pick a name, use the U.S. Patent and Trademark Office’s trademark search tool to see if a similar name, or variations of it, is trademarked.

What’s in a Name? A Potential Goldmine

Set up your business’s legal structure. Will you be a sole proprietor, operate in partnership with someone else or incorporate your business as a corporation or limited liability corporation (LLC)? If you incorporate your business, you must file with the New Mexico Secretary of State (effective July 1, 2013) at www.sos.state.nm.us. If you are unsure about which is right for you, consult your attorney. These articles may also help.(Please note: The articles on this website do not constitute legal advice.)

Sole Proprietorship Makes Sense for Startups
Startups Should Weigh Partnership, Corporate Structures
LLC Format Appeals to Many New Businesses

Obtain a Federal Tax ID number. Any entity other than a sole proprietor/individual owner that does not have employees must obtain a Federal Employer Identification Number (FEIN). This number, also referred to as an Employer Identification Number (EIN), is free and can be obtained online at the Internal Revenue Service website at www.irs.gov.

Obtain a State Gross Receipts Tax (CRS) number. This is also free and can be done online at the New Mexico Tax and Revenue Service website at www.tax.newmexico.gov. Any entity other than a sole proprietor/individual owner that does not have employees must obtain a Federal Employer Identification Number (FEIN).

Register your business with your municipality or county. Visit your city, town or village. You must have a State Gross Receipts Tax number or evidence of application for one.

Obtain necessary permits or certifications. Permits and certifications are required for certain industries such as construction, financial services, manufactured housing, alcohol, gaming and others. Information can be found at the NM Regulation and Licensing Division website at www.rld.state.nm.us.

If you plan to hire employees. Learn the rules, regulations and laws governing employment matters at the U.S. Department of Labor website at www.dol.gov. You must register as an employer with the NM Department of Workforce Solutions at www.dws.state.nm.us. All workers are required to have Worker’s Compensation Insurance. Learn more from the Worker’s Compensation Administration at www.workerscomp.state.nm.us

Employers Who Mislabel Employees Risk Penalties
Hired Hands: Employees or Independent Contractors
Poor Hires to Management Team Can Destroy a Business

If you want to register a patent, trademark or copyright. You may obtain a trademark on your logo giving you exclusive rights to its use. Other items that can be protected are intellectual property such as a proprietary process and a word or phrase used in your marketing. For information about specific rules and how to apply, visit the United States Patent and Trademark Office website at www.uspto.gov. These articles may also help:

What’s in a Name? A Potential Goldmine
Protective Impulses Should Apply to Original Works, Trade Secrets
Patent: The First Line of Defense for a Money-Making Idea
Patents Aim to Protect an Innovator’s Ideas