In today’s information age driven by the advent of the Internet, web-based applications and mobile devices, privacy has become a precious commodity. In the US, almost all states publish “public information” on the Internet, allowing anyone with a web browser to get detailed corporate filing information instantly for free, or for a very modest cost and with only a very short delay.
Exposure from the Internet
This means its possible for members of the public, within a few minutes, to identify ownership, management and other information about public and private companies. That’s right, even the ownership information of private companies is publicly available for almost all companies, regardless of whether they are a C-Corporation, S-Corporation, LLC, Professional Corporation or otherwise.
This poses challenges for business owners who wish to keep their personal names from being publicly attached to their businesses. Whether one simply wishes to avoid harassment, or whether one needs to avoid persecution from a hostile foreign entity, anonymous LLC’s are a great mechanism to create anonymity and prevent ownership or management details from becoming publicly exposed.
An anonymous limited liability company (or anonymous LLC) is defined as a LLC where the ownership information (i.e. members) of the LLC are not made publicly available by the state where the LLC is registered. This is accomplished by forming a LLC in a particular state that supports such anonymous LLC’s, and then using a third-party to act as the organizer and registered agent of the LLC.
Anonymous LLC’s and Your Privacy
New Mexico is one of the few states that allows for truly anonymous limited liability companies. An anonymous LLC means the state does not maintain any records of ownership or management, and therefore has nothing to disclose. In New Mexico, only the Articles of Organization are submitted to the state, and the Articles requires only two names: The organizer and the registered agent, neither of which need to be the actual owner or manager of the anonymous LLC.
In order to create an anonymous LLC in New Mexico, put your trust into an actual licensed law firm or attorney (not one of the Internet legal form companies like LegalZoom, where you don’t have the assurance that an actual attorney is looking out for you). They will be the organizer. A registered agent must be an entity with a physical address in New Mexico, and in order to remain anonymous, you need to pick a registered agent who isn’t connected to you (i.e. avoid friends, family or other entities located at your address if you are in New Mexico). There are many organizations that provide Registered Agent services, and the pricing seems to be in the $90 to $200/year range. L4SB provides registered agent services at a very affordable rate.
Only in New Mexico
What separates New Mexico from other states, is that New Mexico doesn’t require franchise fees or taxes, nor do you have to submit annual reports. Furthermore, New Mexico has no forms or requirements (like Delaware and Nevada, for instance), that requires you to identify who the owners, officers or managers are. The only thing you need, and you need this for any state, is an Operating Agreement that is a private document not submitted to the state, but dictates how the LLC is to be run and who are its members.
In other words, an anonymous LLC is not a special designation or a specific company to create. It’s simply creating a normal LLC in New Mexico, but hiring the right people to create (i.e. organize) and serve as registered agent.
Frequently asked questions and answers:
- Do you need a Tax ID for an anonymous LLC? Yes, if you are engaged in taxable activities, have employees, or you intend to set up bank accounts in the name of the LLC. This is a federal requirement, and is the same for all states.
- Are there any public records of who owns the anonymous LLC in New Mexico? No. It’s completely private.
- Can you avoid legal prosecution with an anonymous LLC? No. If someone is suing you (or there is a criminal investigation), the registered agent will be served, and the registered agent is required to forward on the paperwork to the owner(s) of the anonymous LLC. If you ignore that paperwork, you risk a default judgement or worse.
- Do you have to register your New Mexico anonymous LLC in your home state? It depends. If the NM LLC is used simply to hold property or for your online-only business, with no employees and no local brick-and-mortar presence, then probably not. Seek professional advice on this.
- Do you need a New Mexico bank account with a NM anonymous LLC? No. There is no requirement to open up a bank account in New Mexico.
- Does New Mexico require a publication of the anonymous LLC? No. Unlike many other states, New Mexico does not require one to announce (i.e. publish in a news paper) the formation of your LLC.
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Form an Anonymous LLC