N.M. Admin. Code § 3.2.218.14

Current through Register Vol. 35, No. 21, November 5, 2024

Section 3.2.218.14 - SINGLE MEMBER LIMITED LIABILITY COMPANY WHOSE SOLE MEMBER IS A 501(c)(3) ORGANIZATION

A. A single member limited liability company (llc) whose sole member is a 501(c)(3) organization will be treated like a 501(c)(3) organization and receive the same treatment for purposes of Section 7-9-60 NMSA 1978 so long as the llc is recognized by the internal revenue service as a disregarded entity for federal income tax purposes.

B. Receipts from the sale of tangible personal property to an llc described in Subsection A above when the property is employed in the conduct of an unrelated trade or business as defined in Section 513 of the Internal Revenue Code of 1986, as amended or renumbered, are not deductible pursuant to Subsection A of Section 7-9-60 NMSA 1978. If the llc, or its 501(c)(3) single member, delivering the non-taxable transaction certificate or alternative evidence employs the tangible personal property in the conduct of an unrelated trade or business, the llc, or its 501(c)(3) single member, is liable for the seller's gross receipts tax plus penalty and interest pursuant to Section 7-9-43 NMSA 1978.

Adopted by New Mexico Register, Volume XXVI, Issue 01, January 15, 2015, eff. 1/15/2015, Amended by New Mexico Register, Volume XXIX, Issue 24, December 27, 2018, eff. 12/27/2018