Doing Business As or DBA in Colorado

Colorado is home to over 600,000 small businesses and this includes startups, small and medium enterprises (SME’s), home-based firms, general partnerships, sole proprietorships, large corporations, and LLCs among others. Some of these companies are operating using a business name while some apply for a Colorado DBA online to operate. There are several top brands operating from this state with several companies headquartered in Denver. The list of top companies in the state is quite long and a few names include Arrow Electronics, DISH Network, DCP Midstream, Ball, Qurate Retail, DaVita, and Ovintiv among others. If you are planning to start a new company in this state then you can choose to use the legal name of the owners, use a business name (e.g., Aspen Tours), or file a Colorado DBA online application.

What is DBA in Colorado?

If you are thinking of starting a small business then you will need to first choose a company name. The DBA name would more often than not be the first thing your customers will see, and it will further set the tone for every interaction you have going forward with the customers. The type of name to be chosen will also vary according to the type of entity. For example, a corporation name may be different from that of a sole proprietorship, limited liability company, or a partnership. Business names are normally classified in the following ways:

• Name of the business owner like Paul Faith LLC.
• Traditional business name like Colorado Springs Treks
• File a trade name in Colorado like Jason’s Plumbing

When do you need a DBA?

If you are thinking of filing a DBA in Colorado then you will be able to file it irrespective of your company structure. Of course there are certain state regulations for trade names that you will need to be compliant with. There are numerous situations or circumstances in which any company may need to choose a trade name and this is essentially the first step towards looking up a DBA in Colorado! Let’s look at some of the important factors:

• Expansion of business – If you are already operating a business and want to explore a new area in the same or another industry then this is where a DBA name can be quite effective. When you file a trade name in Colorado for this new aspect, which could be a new product or service, then your customers would be able to differentiate the two based on the business name and the trade name. Let us look at an example to get a clear picture:

  Example: You currently own a robotics company that specializes in designing, construction, and operation of robots. The name of this company is El Paso Robotics Corp. Now, you want to diversify into Artificial Intelligence (AI). Now, robotics and artificial intelligence are different areas due to their objectives and application. In such a scenario, you can conduct a Colorado trade name search and register a DBA name for the division that is focusing on AI.

• Banking Requirements – If you are planning to conduct business in any name other than your legal name, especially a sole proprietorship, then most banks require you to submit a DBA or trade name certificate for opening a business banking account.
• Operate Multiple Businesses – You need to apply for a Colorado DBA online if you plan to operate multiple businesses in the same industry or different sectors. The benefit is that when you apply for a trade name or file an assumed name, you can operate several businesses without creating or registering separate legal entities for each type of business.

Filing DBA in Colorado for LLC and Corporation

Every business being formed in Colorado will have some form of a legal name. This may be dependent on the entity structure and can be the name of the owner. It can even be a traditional company name, which appears in the new business registration documents. You can also choose to operate your company under a DBA also known as a trade name in Colorado. There is a specific process to follow when it comes to choosing a trade name. You will also be required to conduct a Colorado trade name search prior to registering the name. The rules and regulation, the process as well as registration fee will be different from that of business name reservation.

Doing Colorado Trade Name Search

If you have chosen a trade name for your Colorado Company then the first step would be to ensure that the chosen name is compliant with state trade name laws, which are governed by 2022 Colorado Code, Title 7 – Corporations and Associations, Article 71 – Trade Names. According to the laws, Colorado trade name search is one of essential processes that every business owner needs to go through as it will help you identify whether your chosen name is available or not. This is because your trade name might not be unique and several other businesses may be using the same name. If the name is available or not in use then you can go ahead and file a trade name in Colorado.

Basic business database search

The process of Colorado trade name search is similar to that of the business name search. You can conduct the business database search using business name, ID, trade name, trademark, or document number. This search will allow new businesses, both domestic and foreign entities to check if their chosen DBA name is available. Let’s look at an example to under this:

Register Your Colorado DBA

The process of entity search is the answer to the query of how do I look up a DBA in Colorado? which is one of the most common questions that business owners have. If your chosen name is available then filing a DBA in Colorado is necessary. You will be required to complete and file the Statement of Trade Name pursuant to CO Code § 7-71-101 (2022). This application has to be filed online along with a fee of $20. You have an option wherein you can request the filing to take effect immediately or you can delay it for a maximum period of 90 days. Alternatively, we can help you to register a trade name or DBA in Colorado through a process which is easier and faster.

Do you want to file a trade name in Colorado?

Managing Colorado DBA

Once you file a Colorado DBA online application, you can choose when the trade name becomes active. Once it is active, you will be able to use this as the entity name for conducting business within this state. There are certain rules and regulations pertaining to a Colorado trade name or DBA including that of renewal of a DBA, changing, or canceling of the trade name in the jurisdiction where the business is operating from. Let’s look at the various processes applicable to managing a trade name.

How to renew a Colorado DBA?

Once you file a trade name in Colorado, you will have to renew it annually to ensure it remains effective. According to the Colorado Secretary of State, trade name of a non-reporting entity, dissolved or delinquent entity as well as an individual will be effective for a period of one year pursuant to CO Code § 7-71-105 (2022). Similarly, the trade name for a reporting entity (corporation or LLC) will remain effective as long as the said company files its annual reports on time or maintains a registered agent in the state.

How to change Colorado DBA?

After filing a DBA in Colorado, if you want to change the trade name at any given point in time, is it possible? Yes, it is possible. You will be required to file the Trade Name Change or Business Entity Name Change Form as applicable in the city or county that your business is operating from.

Example: If your company is based in Boulder, Colorado then you will need to file “Permit Application and Report of Changes” form, which has a dedicated section for Change of Trade Name or Corporation Name.

How to cancel Colorado DBA?

Once you have filed a Colorado DBA online application, if you decide after some time that you want to cancel the said trade name then is it possible? Yes, it is possible and you will be required to submit a Statement of Withdrawal of Trade Name with the secretary of state pursuant to CO Code § 7-71-106 (2022). There is a fee of $10 for this.

Need Any Assistance in Filing Colorado DBA?

The process to apply for a Colorado DBA online will require you to provide accurate information pertaining to your business and also ensure total compliance with state trade name rules and regulations as well as federal trademark laws. The process of conducting a Colorado trade name search and adhering to all DBA guidelines can be quite a challenging exercise. IncParadise can gladly assist you with this process. We have expertise and knowledge regarding the Colorado state DBA laws and Federal Trademark regulations.

Sole Proprietorship in Colorado

A report by the Small Business Administration (SBA) reveals that Colorado is home to more than 600,000 small businesses and a large number of these entities are sole proprietorships. This is because a first time business owner finds a sole proprietorship in Colorado as a comfortable to operate entity because it lacks the extensive paperwork of a corporation or the multiple decision makers in a limited liability company. If you search for a sole proprietorship in Colorado, you will find this type of entity exists and operates in almost all industries right from home based bakeries to larger food establishments and tour operators. Sole proprietorships can be easily formed and operated within some of the top industries in the state including scientific, construction, retail trade, and technical services industry.

What is a sole proprietorship in Colorado?

It is important to inform oneself on how to start a sole proprietorship in Colorado before you actually start investing in your startup. This type of business entity constitutes several areas that most first time business owners are unaware of. A sole proprietorship is known as an unincorporated entity, which is owned as well as operated by a single person. This type of entity is also known as a sole tradership or individual entrepreneurship. Some of the examples of such an entity are graphic designers, software designers, programmers, photographers, travel journalists, bakery, dental clinic, and pharmacy among others. It is easy to form a sole proprietorship in Colorado as this type of entity has salient advantages over various other types of entities with respect to formation, finances, taxes, and documentation.

Important features of sole proprietorship in Colorado

If you are planning to start a sole proprietorship in Colorado then this is the most basic of all types of entity structures. It is also the oldest type of entity formed and operated in the world and is owned, managed, as well as controlled by an individual or a single person. When you search sole proprietorship in Colorado, you will gain insight on the fact that this type of entity has several remarkable features. Let’s look at some of them

• Ease of formation and Closure – One of the most important features of a sole proprietorship is that it is easy to form. All you have to do is file a Colorado trade name and obtain the necessary licenses. You are not even required to register this type of entity with the State of Colorado. Similarly, it is easy to close a sole tradership business. If you want to dissolve your business at any point in time then unlike corporations and LLC’s, you will not be required to file any articles of dissolution or closure.
• Liability – When you form a sole proprietorship in Colorado, you will be responsible for all debts. Whether you have taken a loan for the business or a personal loan, either ways, you will be responsible for paying off the loan. This can be an advantage as well as a disadvantage.
• Profit or loss – One of the key aspects of a sole proprietorship business is that profit and loss will not be shared. If your company earns a profit then that will belong to the owner and the same rule stands for losses incurred by the company.

Do you want to start a sole proprietorship in Colorado?

Steps to Start Sole Proprietorship in Colorado

If you are wondering how to start a sole proprietorship in Colorado then there are several processes that you need to focus on. These processes are associated with the formation of a new business as well as making it operational. This also includes fulfilling state annual maintenance requirements, which every new company in the state has to be compliant with. Let’s look at the various important processes and steps involved.

1. Prepare a business plan

Whether you start a small business or a large company, one of the very first requirements is that of a comprehensive business plan. It needs to be a carefully thought-out plan as it will lay the foundation for how to start a sole proprietorship in Colorado while ensuring key business objectives are also well laid out. A good business plan will incorporate strategic actions regarding current and future goals while creating a roadmap. It will also take into account various factors that play a key role towards making your sole proprietorship growth oriented and profitable.

• Executive Summary
• Company Description
• Long and short-term Objectives
• Competition Analysis
• Market analysis
• Product and Services
• Target audience
• Operating plan
• Marketing Plan
• Financial Plan

2. Choose a Colorado business name

If you want to form a sole proprietorship in Colorado then it is one of the simplest business structures. However, you will not be able to establish a company without a proper business name. You can always start by using your legal name as the business name or trade name. The importance of the name not only lies with forming a company but also plays a key role in other aspects like sales, marketing, branding, domain name for website, and opening a bank account among others.

• Try to choose a name that is easy to spell and remember
• Identify a name that is not similar to that of your competition
• Follow the Colorado naming rules and guidelines
• Take help from online business name generators like Namelix, BrandCrowd etc.
• You can use your legal name (e.g. – Susan White Cafe)
• You can choose to file a Colorado trade name
• Try to secure trademark protection for your chosen business name

3. File a trade name

If you have taken a decision to not use your legal name then the option is to file a Colorado trade name. A trade name is also known as a fictitious name or a DBA (doing business as) name. It is any name other than the legal name of the owner. When you choose such a name, you are not required to include any additional words, phrases, or abbreviations like corporation, LLC etc. Let’s look at an example to understand this.

4. Get an EIN

If you are wondering how to start a sole proprietorship in Colorado then one of the important steps would be to apply for and obtain a proper tax ID. Tax ID’s are mostly required by new and existing businesses for filing of federal and state taxes. Generally, a sole proprietorship in Colorado can file individual income taxes using the Social Security Number (SSN) of the owner. You may need to apply for an Employer Identification Number (EIN) with the IRS (Internal Revenue Service) by filing form SS-4, if you meet any of the following requirements:

• If your company starts hiring employees
• If you open a business bank account
• When the owner has a Keogh plan
• The state of formation requires filing of excise tax returns
• When you change the entity structure from a sole proprietorship to a limited-liability company
• Filing of Chapter 7 (liquidation) or Chapter 11 (reorganization) bankruptcy

5. Obtain the necessary licenses and permits

If you are wondering how to start a sole proprietorship in Colorado then one of the key areas related to operating your company is the type of licenses that you may need. The licensing regulations for a sole proprietorship business will be quite similar to that of any other form of entity including corporations and LLCs. The type of license required when you start a sole proprietorship in Colorado will vary according to the profession, location, and the business activity. The most common licenses applicable would be:

• Professional or occupational License
• Sales tax license
• Regulatory licenses
• Municipal or county licenses
• Zoning permits

6. Open a bank account for your Colorado business

If you form a sole proprietorship in Colorado then it becomes necessary to separate your personal income from the income you derive from your business. This is where opening a business bank account can be quite beneficial. One of the top advantages of a separate bank account for the company is that it will help create a distinction between personal and business-related expenses especially when it comes to filing taxes. It will aid accurate bookkeeping and analytics while boosting your business credibility.

7. Report and pay taxes

When you search a sole proprietorship in Colorado for taxes, the most important would be the individual income tax. Since, this type of entity is a single owner entity, all profits and losses for the company will be included in the individual tax return of the owner. The state individual income tax rate is a flat 4.40 percent in Colorado. Apart from this, you may be required to file sales and use tax depending on the primary business activity. If you hire employees then you will have to file withholding taxes as well.

Ready to Start a Sole Proprietorship Business in Colorado

If you have already decided to form a sole proprietorship in Colorado then there are several advantages of this type of entity. You can enjoy numerous state benefits including participating in income tax credit programs. You will not be required to register your company with the Secretary of State unlike for LLCs and corporations. However, you will be required to maintain compliance as far as state annual requirements are concerned as this will help you to enjoy a good standing with the state.

Obtain a business License in Colorado

Registration of a company in Colorado doesn’t necessarily mean that your business has become operational. In order to operate your company and transact in this state, you will need to apply for and obtain a Colorado business license. Some businesses including home-based small startups may not require any formal license like selling T-shirts for a non-profit event. However, if you want to open a food cart or a temporary food establishment, then you have to ensure compliance with the local food-safety codes and apply for relevant licenses and zoning permits. This is because a T-shirt poses less risk for the public as opposed to a food establishment and hence the latter will have to apply for relevant Colorado business licenses and permits.

Who needs a Colorado business license?

Starting a new company and running it efficiently is definitely a daunting task. One of the documents required or which is mandatory to operate your business efficiently is a business license. Now, there are several different types of licenses and permits in the state and choosing the one for your business may be an intricate process. Hence, it is always advisable to conduct a Colorado business license search. A license or permit is basically an approval that is often considered an integral part of the regulatory requirements of the state.

What business license do I need in Colorado?

Some US states have a general license for all businesses but Colorado does not have any statewide general license. Instead, there are certain state regulatory agencies that may issue specific licenses for certain types of businesses or professions. One of the most important Colorado business licenses is the one associated with selling of products or services. So, if your company activity is classified under regulated industries selling a specific product then you may need to apply for regulatory licenses as well as seller’s license.

Colorado Business Licenses for Specific Occupations and Professions

If you are planning to start a corporation or an LLC in Colorado then you would need to apply for different licenses and permits as without them you will not be able to transact in the state. One of the most important in this state is the Colorado business license for specific occupations and professions. Basically, the type of license required, the fee, and the issuing authority will depend on the profession or your occupation. Let’s look at an example to understand how this works.

• Accountancy
• Acupuncturist
• Addiction Counselors
• Architects, Engineers and Land Surveyors
• Athletic Trainers
• Audiology and Hearing Aid Provider
• Barber/Cosmetology
• Boxing Official, participant, or promoter
• Chiropractic
• Dental (e.g.,Academic Dentist, Dental Hygienist etc)
• Electrical
• Funeral Home and Crematory
• Marriage and Family Therapists
• Massage Therapy
• Naturopathic Doctors
• Nursing Home Administrators
• Occupational Therapy
• Passenger Tramway
• Pharmacy
• Private Investigators
• Professional Counselors
• Veterinary

Other Colorado Business Licenses

Whether you organize a startup, small business, large enterprise, or even a home-based entity, the licensing requirements in Colorado will vary according to the primary activity as well as the location of your company. Apart from the Colorado business license and permits for professions and occupation, you may still require other types of licenses. These may include sales tax licenses and local or municipal licenses. Let’s look at the other various forms of Colorado business licenses and permits required by any company operating in this state.

Sales Tax License

The most common type of business license required by companies in this state is the sales tax license. Of course, the primary activity of your company should be selling a product or specific tangible personal property. The Colorado sales tax license is also known by other names like a vendor’s license, reseller’s license, or even a resale certificate. It is also important to note that in the state of Colorado, services are not subjected to this sales tax. This type of Colorado business license is applicable only within the state as well as state-collected tax jurisdictions.

• Standard Retail License (Sales Tax License) – Your Company may need to obtain a Colorado business license if you are involved in retail sales in the state. If your company is involved in both retail and wholesale sales then this single license will allow you to conduct both activities.
• Wholesale License – If your company plans to purchase items for reselling without paying sales tax then you will need to complete the CR 0100 form for obtaining a Colorado sales tax account/license. The CR 0100 is known as the ‘ Colorado Sales Tax and Withholding Account Application’. This will allow you to collect sales tax when you resell various items.
• Single Special Event License – This type of Colorado business license and permits is meant for a temporary location, which is different from your regular business location. This license is also valid for only one event.
• Multiple Special Event License – If your company plans on attending several special events then this Colorado business license will be applicable. This license is valid for 2 years.
• Mobile Vendors – Mobile vendors are those who sell out of a truck or any other vehicle. If you are thinking of becoming a mobile vendor then you need to have a sales tax license for your main office location.

Local Colorado business licensing and permits

Colorado business license search is important because you will get to know about the different licensing requirements in the state as well as local municipal areas also known as city or county licenses. Most cities and counties in the state of Colorado have their local laws pertaining to licensing and permits and the laws as well as requirements which vary from one city or county to another. Let’s look at an example to understand how it works.

Example: If you plan to start a business in the City of Thornton then apart from the ​Sales and Use Tax Business License (if required), your company may be subjected to additional requirements like certificate of occupancy, initial use tax, and zoning approval depending on the nature of business activity. The city does not have any annual renewal requirement for Colorado business licenses and permits. Similarly, if you start a business in the City of Littleton then you will need to contact the Zoning Division prior to engaging in any business. Certain businesses like sellers of beer or wine will be required to obtain a liquor license from the Office of the City Clerk.

Colorado home-based business license

Colorado is home to a good business climate and availability of workforce and talent makes it attractive for home-based businesses and startups. In fact, the startup growth has been at a rate of 74.1% since 2017 and several of them initially established themselves as home businesses. Women entrepreneurs have also been growing in numbers and leading the way for home-based startups especially in metro areas like Boulder and Denver. The question is would you require a Colorado business license for a home-based small business? And the answer is yes.

Need any Assistance in Obtaining Your Colorado Business License?

If you are planning to start a small business from home or a medium enterprise from a commercial space in the state of Colorado then one of the most important compliance is that of a business license. A Colorado business license will ensure your company is able to transact in the state. You will need to apply for state as well as local Colorado business licenses and permits depending on the nature of business activity and location of your company. The license application, fees, and renewal processes will vary according to the type of permit and municipality in which your company is located.

Colorado Business Entity Search

A business name is considered as the cornerstone of any brand and if you want your startup to stand apart from others, then you need to choose the right name. There are examples of several big brands who created their names from a concept e.g., Adidas focused on the concept of quality and innovation and created a tagline – impossible is nothing. You can imagine the sheer power behind such a brand. But the important question is where do you really start?

• You need to avoid names that will be hard to spell for any customer. A simple and straightforward name like Orange Inc., or Stone LLC., would be perfect
• It is also important to follow the Colorado business name rules and guidelines
• Always try and choose a business name that will not limit your company. For example, books4kids can be limiting as you may want to diversify into adult books or comics in the near future
• Ensure that the chosen company name is consistent with the brand image
• Ensure your chosen name is not similar to that of a competitor
• Always conduct a Colorado business name search prior to reserving or registering the name with the state
• Pick an entity name that will be web-friendly as this will ensure domain name is available for such a name
• Lastly, you can also get some good company name ideas by using online business name generators

What is a Colorado business name search?

Once you have chosen the type of structure like an LLC or a C Corporation, the next step would be to identify a company name based on Colorado business name rules. Once a name has been chosen, you will need to check if you can actually use such a name in the state of Colorado. This is possible by conducting a Colorado business name search. This is a type of entity search that is available in all states of the USA although the process of searching and facilitating authority will be different. The governing authority for an entity name search is facilitated by the office of the Colorado Secretary of State.

• Business Database Search – This will enable you to search for a business name, trademark, trade name, ID or document number
• Business Entity Search – This will enable you to search for businesses active and uses Organization name or Organizational ID# to facilitate the process.

Naming your Colorado LLC

If you have taken a decision to form a limited liability company then one of the foremost processes is to name your company. A business name will provide a face to your LLC and it can be used for reaching out to your prospective customers. An effective business name is a name that conveys information about the values of the company as well as the quality of its offerings like specialized services. The name of your LLC will also have an impact on your overall business strategy. So, let’s take a look at the important areas to focus on including conducting a Colorado LLC name search.

General LLC naming rules

Naming your limited liability company can be a short process or a long process. When choosing a LLC name, it is important to follow the Colorado business name rules and guidelines as regulated by 2022 Colorado Code, Title 7 – Corporations and Associations, Article 90 – Colorado Corporations and Associations Act, Part 6 – Entity Names. You will also need to conduct a Colorado LLC name search after choosing a name compliant with governing laws. The general rules for an LLC name are:

• Your company name should have words like Limited Liability Company or limited liability co.
• The business name can have abbreviations like LLC or L.L.C. pursuant to CO Code § 7-90-601 (2022)
• The business name should be distinguishable from any other name in the database of the Colorado Secretary of State like JB LLC is not the same as JB Limited Liability Company
• The law states that a business cannot use a name that implies or is similar to that of a government agency or unit
• It is important to note that the reservation of names containing certain words are prohibited like “bank” or “trust.”

Search LLC name availability on the Colorado Secretary of State’s website

Once you have identified a name for your limited-liability company, it is necessary to conduct a Colorado business name availability search. The office of the Secretary of State offers an online portal that will enable a name search for your LLC. This search brings up any similar names after searching through the entire state database also known as a business entity database. There are different ways to conduct the search and they are:

• Advanced Search using registered agent name or Trade name
• Entity search using organization name or Organizational ID #
• Business survey information search
• Trademark advanced search

Are you planning to form an LLC in Colorado?

Naming your Colorado Corporation

A Colorado Corporation is considered as one of the best forms of business to operate. It is also known as a traditional corporation or a C Corp and once you form this type of company, you can always elect S Corp tax status. If you have taken the decision to incorporate in this state or move your existing business from another state then it becomes necessary to first identify a corporate name. If your company is a foreign entity then you can conduct a Colorado Corporation name search for the existing name. If it is a new domestic entity then you need to choose a name while ensuring the name is compliant with all Colorado business name rules and regulations. Let’s look at some of the important aspects to consider when naming your business corporation.

General Corporation naming rules

When choosing a corporate name, there are several aspects that should be considered like:

• The purpose of your company,
• The products or services being offered,
• The need to create a distinctive impression,
• The idea that is being delivered to the consumer should be relevant

• The company name should contain words like “corporation”, “company”, “incorporated”, or “limited”
• The company name may contain abbreviations as well like “corp.”, “co.”, “inc.”, or “ltd.”
• The chosen name should not imply that the said corporation has been organized for any purpose other than what has been outlined in the articles of incorporation.
• The law states that the application for reservation of name will be rejected if it contains certain words will like Bank, Banking, Engineer, etc
• The chosen name should be distinguishable from those already existing in the state entity database e.g., LKC Inc is the same as L.K.C. Inc.

Search Corporation name availability on the Colorado Secretary of State’s website

The Colorado business name availability search is the most important step towards name reservation in the state. If your company name is not reserved then you will not be able to incorporate in this state. The Colorado Corporation name search is facilitated by the online portal of the Colorado Secretary of State. There are different ways by which you can conduct this search and they are:

• Advanced Search using registered agent name or Trade name
• Entity search using organization name or Organizational ID #
• Business survey information search
• Trademark advanced search

Are you thinking of Incorporating in Colorado?

Need any Assistance in a Colorado Business Name Search?

A corporate name or an LLC name is the most important aspect of any business as it helps in creating an identity for your company. An impactful name will make your business stand out and this is good from the perspective of marketing, sales, and competition. Hence, choosing the right name is not the only important step but it should be followed by conducting a Colorado business name search. This process will ensure your chosen name can be used in this state.

Colorado LLC Annual Filing Requirements

In the state of Colorado, you can choose to form a single-member or a multi-member LLC and can even register a foreign limited liability company. Once you have registered your company, it becomes an active entity. This also means that your company would be subjected to Colorado LLC annual requirements and you need to be compliant with these requirements or else you or your company may be penalized. Let’s take a look at the various Colorado LLC annual filing requirements.

Colorado LLC Annual Report (Periodic Report)

Once a new business is formed in any state in the USA, they have to fulfill certain annual requirements in the said state while being compliant with the state laws. An annual report is one such requirement, which is applicable in most states in the USA including Colorado. It is known as a periodic report. A Colorado annual report for a limited liability company is a detailed report showcasing the activities of the said company throughout the previous year. When you file a Colorado LLC annual report, it provides updated information to the Secretary of State regarding the company, like changes in ownership, change of address, and registered agent change among others.

What does it include and how to file it?

The information provided in a Colorado periodic report may vary according to the type of entity like the report for an LLC will be different from that of a domestic corporation or a foreign LLC. This information is often guided by the state business laws. If you are planning to file a Colorado LLC annual report then you will need to include the following information:

• Name of your company
• Business ID number
• The state where you formed your LLC (Domestic or foreign)
• Principal street address and mailing address
• Information pertaining to your registered agent including their full name and street address.
• Business email address.
• Full name and address of individual filing the Colorado periodic report

What is the due date for filing?

The Colorado periodic report is one of the most important annual requirements for a limited liability company. There is a specific due date for filing this report annually and is governed by the 2022 Colorado Code, Title 7 – Corporations and Associations, Article 90 – Colorado Corporations and Associations Act, Part 5 – Annual Reports – Statement of Person Named in Filed Document § 7-90-501 – Periodic Reports. The due date to file a Colorado LLC annual report will always be by the end of the initial registration month.

Example: If you register your LLC January 19, 2024 then the due date for the Colorado annual report will be January 31, 2025. January will be considered as your ‘Periodic Month.’ You can also file this report two months prior to the periodic month, which is by November 2024.

Do you want to file Colorado LLC Periodic Report?

Penalties if one fails to file

Since filing of an annual report is one of the mandatory Colorado LLC annual requirements; failure to file this report may lead to penalties. If a limited-liability company doesn’t file the required Periodic Report on time then the status of the LLC will be considered to be noncompliant. You will get an additional two months post the Periodic Report month for LLC annual filing Colorado along with a late fee of $50.

Colorado LLC Taxes

One of the important Colorado LLC annual requirements is that of taxes. Filing your taxes on time will ensure you are in good standing with the state. The Internal Revenue Service (IRS) classifies a limited liability company as a pass-through entity by default and this means that the tax liabilities of the company will be passed on to the owners. Thus the owners of the said LLC will be required to file this on their personal tax return. Colorado has a flat income tax rate of 4.63% on the LLC profits.

Colorado Corporation Annual Filing Requirements

If you are planning to form a business in the state of Colorado then one of the most opted for entity structures is that of a C Corporation, also known as a traditional corporation. This type of structure has many advantages including limited liability protection. Once you organize such an entity, you will need to adhere to the state laws and ensure all Colorado Corporation annual requirements are met. Let’s take a look at the annual filing requirements in the state.

Colorado Corporation Annual Report (Periodic Report)

A Colorado annual report is required by new and existing businesses in this state and is governed by the Colorado Code. This report requires entities to provide updated information to the Secretary of State, which may include changes in ownership, registered agent change or even change of the physical address. When filing a Colorado corporation annual report, you may even be required to provide additional information like total assets and paid-in capital. This report is known as a periodic report in the state of Colorado.

What does it include and how to file it?

Once you incorporate in the state of Colorado, filing a Colorado corporation annual report becomes a mandatory requirement. The information required may vary according to the entity structure and location of the entity e.g., the Colorado periodic report for a domestic entity may be different from that of a foreign corporation. Some of the basic information required in this report are:

• Name of your company
• Business ID number
• The state where you formed your LLC (Domestic or foreign)
• Principal office street address
• Principal office mailing address
• Registered agent name
• Registered agent street address
• Corporation email address for notifications
• Full name and address of individual filing the Colorado annual report

What is the due date for filing?

The periodic report is one of the most important Colorado Corporation annual requirements and has to be filed within the due date pursuant to CO Code § 7-90-501 (2022). The due date for each reporting entity will always be by the end of the initial incorporation month.

Example: If you register your Corporation February 01, 2024 then the due date for the Colorado corporation annual report will be February 28, 2025. The month of February will be considered as your ‘Periodic Month’. You can also file this report two months prior to the periodic month, which is by December 2024.

File your Colorado Corporation Periodic Report on time!

Penalties if fail to file

Each domestic or foreign corporation formed in this state has to fulfill Colorado Corporation annual requirements and this includes filing of the annual report within the stipulated time. If any entity fails to file the periodic report within the due date then they will be penalized. Such a corporation will then be considered to be noncompliant and you will get an additional two months post the periodic report month for filing the report with a late fee of $50.

Colorado Corporation Taxes

One of the important Colorado Corporation annual requirements is that of state taxes. It is crucial that you file your taxes on time as failure to file can affect the good standing status you enjoy with the state. The most important of all taxes is the corporate income tax and the rate for the same is a flat 4.40 percent. The second most important form of tax is the sales and use tax. The state sales tax rate across Colorado is 2.90 percent with a maximum local sales tax rate of 8.30 percent. It is important to note that certain counties and cities have their own sales and use tax structure. The tax rate can vary according to the product being sold or services offered like the tax rate for Regional Transport District (RTD) sales tax rate is 1 percent according to Metro Denver Economic Development. Apart from this, a corporation may be required to file withholding taxes.

Need any Assistance in Filing Colorado LLC or INC Annual Reports (Periodic Reports)?

The Colorado Corporation annual requirements or that of an LLC entail filing of annual reports as well as taxes. Sometimes business license renewals are also considered a part of Corporation or LLC annual filing in Colorado. If you have started a new business or are planning to register one then it is important to ensure fulfillment of state annual requirements in order to operate without any difficulties.

Colorado LLC or Corporation

You can form different types of businesses in the state of Colorado although the most popular forms are a corporation and a limited-liability company. The overall cost to form a Colorado Corporation or an LLC is also low and there are tax credit programs as well as small business incentive programs which can help offset some of the actual operational costs. It is important though to take into account various aspects of the entity you choose to form including foreign entities. When you look at a comparative analysis of LLC vs Corporation in Colorado; you may find different sets of advantages and drawbacks for each entity right from liability protection to tax liabilities, annual maintenance cost, and licensing costs.

Which business entity should I choose for my Colorado business?

One of the most difficult decisions you will ever have to make when forming a new business is the type of entity to choose. The cost to form a Colorado LLC will always be different from the cost to incorporate or register any other form of business including a foreign company. The paperwork, fee, taxes, and licenses required by your company will also vary, thus, the annual maintenance cost of Colorado Corporation may be different from that of an LLC. The two most popular structures in the state of Colorado are that of an LLC and a C Corporation. Let us look at some of the finer aspects of these structures.

• Limited Liability Protection – One of the most important areas to focus on is limited liability protection. If an entity structure provides limited liability protection then it means that the assets of individuals associated with such an entity cannot be forcefully obtained for repayment of debts attributed to the company.
• Startup costs – The chosen business structure also plays a key role when it comes to the overall startup and operational costs. The Colorado LLC cost per year or that of a corporation is a decisive factor as this may overburden your existing budget.
• Taxation – Taxes play a key role when it comes to choosing the entity structure. Whether you incorporate in Colorado or form any other form of business, there are different taxes to be filed at the federal, state, and local level. Some entities may need to file less taxes as compared to others.
• Investors Involvement – Apart from the cost to form a Colorado Corporation, there can be several other costs associated with the operational aspect of the said entity or any type of company. This is where investment through private sponsors can be quite helpful. It is important to understand that not all types of structures attract investors due to certain limitations.

Pros and Cons of forming an LLC or Corporation in Colorado

A company structure plays a crucial role in day-to-day activities and also has a significant impact on annual maintenance requirements of the state of Colorado. Hence, it is important to identify the pros and cons of each entity including the long term and short term benefits.

Pros of an LLC or Corporation

• A business or traditional C corporation can issue stock
• An LLC enjoys pass-through taxation on its profits
• Annual maintenance cost of Colorado Corporation is lower than that of other states
• You can choose a single-member LLC or a multi-member LLC
• Venture capitalist (VC) firms and other private investors prefer to invest in C corporations as compared to other entity structures
• An LLC has to follow fewer regulations, which means less paperwork and greater ease of operations
• A business corporation enjoys perpetual life
• An LLC or a corporation can elect for S Corporation tax status
• A limited-liability company does not have a rigid management structure

Cons of an LLC or Corporation

• The overall cost to form Colorado LLC is higher than that of a sole proprietorship
• The registration of a C Corporation requires a lot of paperwork
• The C Corporation undergoes double taxation
• A big drawback is that a limited liability company cannot raise capital
• Depending on the state of formation, LLC members may be subjected to self-employment tax
• An LLC cannot issue shares of stock unlike with Corporations
• A C Corporation has an extremely rigid and complicated management structure

Colorado LLC Cost

The Colorado LLC cost per year is lower than several other states and thanks to the pro-business regulations, a limited liability company is more lucrative for entrepreneurs as opposed to other forms of business. If you are thinking of forming an LLC then it is important to identify the cost to form a Colorado LLC. Let us take a look at the various costs that you may incur.

Cost for forming a Colorado LLC

The cost to form a Colorado LLC takes into account one-time initial costs as well as recurring costs or annual costs. These are:

• The LLC initial registration process and fee may be different from that of other entities. The first step is to conduct a name availability search and the Statement of Reservation of Name pursuant to §7-90-301, et seq. and §7-90-602 of the Colorado Revised Statutes (C.R.S.). The fee for reservation of name is $25
• According to state laws, you will need to hire and maintain a registered agent for service of process. The cost or fee would vary according to the RA service chosen by you.
• The third and most important area of Colorado LLC cost per year is the registration costs. You will have to file the Articles of Organization pursuant to CO Code § 7-80-204 (2022). The filing fee for the same is $50.

Annual maintenance cost for Colorado LLC

Once you have registered a limited-liability company in Colorado; you will need to maintain compliance with annual requirements as specified under 2022 Colorado Code, Title 7 – Corporations and Associations, Article 80 – Limited Liability Companies. Annual maintenance comes under Colorado LLC cost per year and are as under:

• Periodic Report – In the state of Colorado, each and every limited liability company registered with the state has to submit the periodic report each year with the Secretary of State. This is an important annual requirement and is a component in the cost to form a Colorado LLC. Filing this report helps the entity to maintain a “Good Standing” with the state. There is a filing fee of $10.
• Taxes – A limited liability company is considered as a “Pass-through Entity”. Hence each member will be required to file personal income tax. Apart from this, an LLC will also be required to file self-employment tax and sales and use tax.
• Business Licenses – One of the important Colorado LLC costs per year is that of business licenses and permits. This is a recurring cost as licenses and permits have to be renewed each year. The fee for licenses will vary according to the type of license and the location of the entity.

Form your new LLC in Colorado with Ease!

Colorado Corporation Cost

A C Corporation or a traditional corporation is one of the favored entity structures for first time business owners. If you conduct an LLC vs Corporation in Colorado, you will note that the latter can raise funds by issuing stock and is attractive to investors as well. If you have chosen to establish this type of an entity then let us look at the cost to form a Colorado Corporation.

Cost of forming a Corporation in Colorado

The initial cost of forming a Colorado Corporation will be determined by several factors. The cost will vary depending on whether you want to register a foreign company or a domestic entity. The important costs related to incorporation in this state are:

• The first step towards incorporation is to conduct a name availability search, also known as Business Database Search in Colorado. If your chosen name is available then you can file the Statement of Reservation of Name along with a fee of $25.
• You can also register a Colorado DBA (Doing Business As), which is also known as a trade name. You will be required to file a Trade Name Statement for same along with a fee of $20. This is an important component of the cost to form a Colorado Corporation.
• Whether you form a domestic entity or a foreign corporation, it is necessary to hire and maintain a registered agent for service of process pursuant to CO Code § 7-90-701 (2022). The cost or fee would vary according to the service chosen by you.
• The most important initial cost is associated with the process to incorporate in Colorado. You will have to file the Articles of Incorporation for a Profit Corporation pursuant to CO Code § 7-102-102 (2022). There is a fee of $50 for incorporation.

Annual maintenance cost for Colorado Corporation

Apart from the initial cost to form a Colorado Corporation, there will be other costs associated with annual maintenance of your company. The costs involved are as follows:

• Periodic Report – One of the important annual maintenance costs of a Colorado Corporation is the one associated with filing of a periodic report. Most states in the USA require corporations to file an annual report and in this state, the same report is known as a periodic report. Filing of this report on time will ensure your company enjoys a good standing with the state. This report is filed annually with the Colorado Secretary of State along with a fee of $10.
• Taxes – A domestic or foreign C Corporation in Colorado will be required to file Corporate Income Tax at a rate of 4.40% percent on Colorado net income. Your company may also be subjected to certain other state taxes like the sales and use tax, withholding tax, and property taxes.
• Business Licenses – An important component in the annual maintenance cost of a Colorado Corporation is associated with business licensing. You may need a single license or multiple licenses depending on the primary business activity and location. The three main licensing categories are professional licenses or permits, regulatory licenses, and county or city permits. It is a recurring cost as licenses have to be renewed each year.

Register a Corporation in Colorado Efficiently!

Need any Assistance in Forming Your Colorado LLC or Corporation

Colorado has a strong and diversified economy that is home to small and medium sized enterprises (SME’s). The state has a pro-business environment and an evolving startup ecosystem. As a first time entrepreneur, you can choose from a wide variety of entity structures although Corporations and limited liability companies are more popular. The process to incorporate in Colorado or register a business may vary and so will the costs related to such processes. We, at IncParadise have knowledge and understanding of the processes and cost to form Colorado LLC or corporation and can provide meaningful assistance.