Abstract We present the third discovery from the COol Companions ON Ultrawide orbiTS (COCONUTS) program, the COCONUTS-3 system, composed of the young M5 primary star UCAC4 374−046899 and the very red L6 dwarf WISEA J081322.19−152203.2. These two objects have a projected separation of 61 ′ ′ (1891 au) and are physically associated given their common proper motions and estimated distances. The primary star, COCONUTS-3A, has a mass of 0.123 ± 0.006 M _⊙, and we estimate its age as 100 Myr to 1 Gyr based on its stellar activity (via Hα and X-ray emission), kinematics, and spectrophotometric properties. We derive its bulk metallicity as 0.21 ± 0.07 dex using empirical calibrations established by older and higher-gravity M dwarfs and find that this [Fe/H] could be slightly underestimated according to PHOENIX models given COCONUTS-3A’s younger age. The companion, COCONUTS-3B, has a near-infrared spectral type of L6 ± 1 int-g, and we infer physical properties of T _eff = 1362 − 73 + 48 K, log ( g ) = 4.96 − 0.34 + 0.15 dex, R = 1.03 − 0.06 + 0.12 R _Jup, and M = 39 − 18 + 11 M _Jup using its bolometric luminosity, its host star’s age, and hot-start evolution models. We construct cloudy atmospheric model spectra at the evolution-based physical parameters and compare them to COCONUTS-3B’s spectrophotometry. We find that this companion possesses ample condensate clouds in its photosphere (f _sed = 1) with the data–model discrepancies likely due to the models using an older version of the opacity database. Compared to field-age L6 dwarfs, COCONUTS-3B has fainter absolute magnitudes and a 120 K cooler T _eff. Also, the J − K color of this companion is among the reddest for ultracool benchmarks with ages older than a few hundred megayears. COCONUTS-3 likely formed in the same fashion as stellar binaries given the companion-to-host mass ratio of 0.3 and represents a valuable benchmark to quantify the systematics of substellar model atmospheres.