Tax Law & Planning ✦ New Mexico
Pay What the Law Requires. Not a Dollar More.
Entity selection, S-corp elections, transaction structuring, trusts and succession, gross receipts tax — proactive tax law counsel for New Mexico business owners and families, from an attorney-CPA who plans with the audit in mind.
Overview
What does a tax planning attorney actually do?
Tax planning is the legal structuring of your business, investments, and estate so that the tax result is decided before the transaction happens — not discovered afterward on a return. Because the practice is led by an attorney who is also a CPA, the advice connects directly to your actual financial statements and returns, and every recommendation is built to survive examination: documented, cited, and defensible.
- Choice of entity — LLC, partnership, S-corp, C-corp analysis
- S-corporation elections & reasonable compensation studies
- Qualified business income deduction planning (I.R.C. § 199A)
- Accountable plans, fringe benefits & retirement plan design
- Business purchase & sale structuring — asset vs. stock
- Real estate strategy — 1031 exchanges, depreciation, dispositions
- Trusts, estates & business succession planning
- Written tax opinions & penalty-protection documentation
- New Mexico gross receipts tax structuring & compliance
- Multistate exposure — nexus, sourcing & residency planning
At a Glance
How do the entity choices compare at tax time?
| Sole prop / SMLLC | Partnership LLC | S corporation | C corporation | |
|---|---|---|---|---|
| How profit is taxed | Owner’s 1040, Schedule C | Flows through on K-1s | Flows through on K-1s | 21% at the entity; dividends taxed again |
| Self-employment tax | On all net profit | Generally on active shares | Only on W-2 salary — the main draw | None; owners on payroll |
| QBI deduction (§ 199A) | Yes | Yes | Yes | No |
| Compliance load | Lightest | Form 1065 + K-1s | Payroll + Form 1120-S; reasonable-comp scrutiny | Heaviest |
| Often best for | Early stage, modest profit | Multiple owners, real estate | Established profit above a fair salary | Reinvestment, outside investors |
The right answer is a calculation on your numbers — profit level, owner salary, New Mexico gross receipts tax profile, and exit plans — not a rule of thumb. We run it both ways and show you the math.
Which entity should my New Mexico business be?
For most closely held businesses the real question is how the entity is taxed, not what it is called. An LLC is a state-law wrapper that can be taxed as a disregarded entity, a partnership, an S-corporation, or a C-corporation. The right answer turns on your profit level, owner compensation, exit plans, investors, and New Mexico gross receipts tax profile. We model the alternatives with actual numbers — including self-employment tax, the § 199A deduction, and state effects — and paper the choice correctly.
How do I lower my business taxes legally?
Sustainable tax savings come from structure, not aggression: compensation design, accountable plans for owner expenses, the right retirement vehicle (a solo 401(k) or defined benefit plan can shelter far more than an IRA), income timing, family employment done correctly, and full use of depreciation elections. Every strategy we implement comes with the documentation that makes it stick in an audit — because we spend the other half of our practice defending audits.
What about trusts, estates, and passing on the business?
Succession is a tax event whether you plan it or not. We design wills, trusts, buy-sell agreements, and gifting strategies that use the federal estate and gift tax exemption efficiently, preserve the step-up in basis under I.R.C. § 1014 where it matters, and keep a family business from being dismantled to pay a tax bill. New Mexico currently imposes no state estate or inheritance tax, which makes federal planning the main event for New Mexico families.
Built to Hold Up
Planning that survives the audit.
Half of this practice defends taxpayers in examinations — which changes how we plan. Every structure we recommend comes with the paper the IRS will ask for years later: minutes, elections, accountable-plan documents, valuation support, and, for significant positions, a written opinion that can serve as reasonable-cause penalty protection.
Aggressive-but-undocumented is the most expensive kind of tax planning. Conservative-and-provable usually wins by a mile.
Questions & Answers
Tax planning questions we hear from New Mexico owners
Do you work with businesses outside of Albuquerque and Santa Fe?
Yes — the practice is fully remote and serves business owners across all of New Mexico, from Las Cruces to Farmington. Planning engagements are handled by video conference and secure document exchange.
When does an S-corporation election make sense?
Generally once profits are consistently above what a reasonable salary for your work would be, an S election under I.R.C. § 1362 can reduce self-employment tax on the excess. But the election has real costs — payroll compliance, reasonable-compensation scrutiny, state tax wrinkles — so the answer is a calculation, not a rule of thumb. We run the numbers both ways before recommending it.
What is a tax opinion and when do I need one?
A tax opinion is a written legal analysis of how the tax law applies to a specific transaction, issued before you do it. For significant transactions, a well-supported opinion both guides the structure and can serve as evidence of reasonable cause and good faith if a position is ever challenged.
Do you handle New Mexico gross receipts tax planning?
Yes. New Mexico’s gross receipts tax reaches services and businesses that other states’ sales taxes don’t, and deduction and exemption eligibility is documentation-driven. We help businesses structure invoicing, nontaxable transaction certificates, and multistate sourcing correctly from the start.
The best time to plan was before the transaction. The second best time is now.
Bring us the deal, the entity, or the estate — we’ll bring a flat-fee plan with the citations to back it up.