New Mexico LLC for Foreigners: Rules, IRS and Brazil's Law 14,754

A New Mexico LLC can be opened by foreigners without living in the US, but a single-member LLC owned by a foreigner files Form 5472 with a pro forma 1120 with the IRS every year, under a US$ 25,000 penalty. For a Brazilian resident, Law No. 14,754/2023 (Lei 14.754/2023) may tax the result.

This guide separates what comes from an official source from what is marketing. State fees and deadlines only count if checked on the New Mexico Secretary of State's website; federal obligations come from the IRS; and the treatment in Brazil comes from Brazilian law. If you are still comparing states, also see the guide to a Wyoming LLC for non-residents.

What Is a New Mexico LLC and Who Regulates It?

A New Mexico LLC is governed by the Limited Liability Company Act, arts. 53-19-1 to 53-19-74 of the NMSA 1978, listed by the Secretary of State among the laws governing business in the state. The Secretary of State is the agency that registers the company, and it states that formation and maintenance filings are made through the online portal, with no paper forms.

As in other states, what the LLC offers is a separation between the company's assets and the owners' assets, within the limits of the law. This is not a shield: if the owner mixes personal and company accounts, or uses the LLC to defraud creditors, the separation can be disregarded. For asset protection and its limits in Brazil, see the offshore asset protection guide.

How Much Does It Cost to Open and Maintain, and Where Do You Check?

Formation fees, registered agent fees and any reports change and must be checked on the Secretary of State's business services portal before you hire anyone. This guide does not repeat third-party figures, because outdated numbers are the most common error in LLC content. Two checks are worth doing before you commit:

• •Registered agent: the state's LLC law requires keeping an agent and an address in New Mexico. Confirm this in the current text.
• •Periodic reports: do not assume the LLC is exempt from annual reports. Confirm on the portal whether there are any and which ones, because a missed deadline can affect the company's standing.

Beyond what the state charges, count the cost of preparing the returns in the US and in Brazil, which usually weighs more than the formation fee.

What Does the IRS Require From a Foreign-Owned LLC?

An LLC with a single member can be treated by the IRS as a disregarded entity or elect to be taxed as a corporation, under the IRS entity classification rules. The classification decides how income is taxed in the US and should be analyzed with a US professional.

Regardless of the tax, there is a reporting obligation. According to the Form 5472 instructions, a "foreign-owned U.S. DE" (a disregarded entity 100% owned by foreigners) is treated as a corporation for purposes of section 6038A. In practice:

1. •The LLC has no income tax return of its own, but it must file a pro forma Form 1120 with Form 5472 attached, by the due date of the 1120, including extensions.
2. •On the pro forma 1120, only the LLC's name and address and items B and E of the first page are filled in, and "Foreign-owned U.S. DE" is written at the top of the form.
3. •It is filed by fax or mail to the IRS's dedicated address. The entity cannot file Form 5472 electronically.
4. •The tax year is the same as the owner's for US purposes; if the owner has none, it is the calendar year.
5. •The extension is requested with Form 7004, up to the original due date.

The penalty for not filing the form on time and in the required manner is US$ 25,000, and it also applies to failing to maintain the required records. A substantially incomplete form counts as not filed. The form must list transactions with related parties, of the types provided in Parts IV to VI, and the IRS instructions are the starting point for preparing the document.

What About FinCEN's Beneficial Ownership Report?

The Corporate Transparency Act created a beneficial ownership report to FinCEN. According to FinCEN itself, the final rule that made the exemptions permanent provides that companies formed in the US and US persons do not need to file the report. Today the obligation falls only on foreign entities registered to operate in the country. The FinCEN information is the source for checking the current status, which has changed more than once.

The state's page on the topic may be outdated compared with FinCEN, so always confirm with the federal source before deciding.

How Does Brazil Treat a Resident's LLC?

An individual resident in Brazil who controls an LLC abroad falls under Law No. 14,754/2023 (Lei 14.754/2023). Art. 5 taxes, on December 31 of each year, the profits of controlled entities, as provided in art. 2, as long as they meet the cases in § 5: being in a favored-tax country or under a privileged tax regime, or earning own active income below 60% of total income. Income from financial investments abroad is taxed at a rate of 15% (art. 2).

Two practical notes:

• •Case-by-case classification: whether the LLC falls under art. 5 depends on the nature of the income, the applicable tax regime and the control structure. There is no automatic answer by US state.
• •Transparency option: art. 8 allows you to declare the controlled entity's assets and rights as if they were your own. The option is irrevocable while you hold the entity and applies per entity.

The data reaches Brazil's Federal Revenue Service (Receita Federal) by other routes as well. Anyone with assets and rights abroad totaling US$ 1 million or more on December 31 reports to the Central Bank of Brazil (BCB) through the CBE (Brazilian Capital Abroad report), and everything that exists abroad must appear in the DIRPF (Brazilian individual income tax return). If the owner lives outside Brazil and has filed the departure notice, the situation is different: see how offshore works for those leaving Brazil.

New Mexico, Wyoming, or Another State?

The choice of state does not change the IRS rule or Brazilian taxation. It affects the law that governs the LLC, the fees, the registered agent and what the bank or business partner accepts more easily. For that reason:

• •compare fees and obligations on each state's official source, never in a third-party table;
• •ask the bank or payment platform you plan to work with whether it opens accounts for LLCs from the chosen state;
• •consider the local support available for registered agent and accounting.

If your goal is broader, such as a holding company, investments or international operations, see the corporate structures services.

Bank Account: The Step That Stalls Most People

Having an LLC does not guarantee an open account. Banks and fintechs run their own due diligence: they ask for company documents, owner identification, source of funds and a description of the activity. Opening can be refused even when the company is in good standing. Prepare:

• •certificate of existence and formation documents;
• •the LLC's tax ID (EIN, also used on Form 5472);
• •proof of address and of the owners' source of funds;
• •a clear description of what the company does.

See the offshore banking services to understand how this process works in practice.

Step by Step to Set It Up Safely

1. •Define the goal (investing, receiving from clients, holding assets) before choosing the state.
2. •Check fees and reports on the New Mexico Secretary of State's website.
3. •Hire a registered agent and open the company through the state portal.
4. •Obtain the EIN and define the tax classification with a US professional.
5. •Schedule Form 5472 and the pro forma 1120 every year, well in advance and by mail or fax.
6. •Consult FinCEN to confirm the status of the beneficial ownership obligation.
7. •Open the bank account with the documentation prepared.
8. •In Brazil, declare: DIRPF, Law 14,754 and CBE when applicable. The compliance page and the tax planning service help organize this.