How to Start an LLC in Colorado (2024 Guide)
Wondering how to start an LLC in Colorado?
To get started, you'll need to pick a suitable business name, choose a registered agent, and file your Articles of Organization with the Colorado Secretary of State ($50 processing fee).
You can do this independently, consult with a business attorney for specialized legal guidance, or join the other 65% of our readers and hire a specialized Colorado LLC formation service (recommended).
Northwest ($29 + State Fees)
LegalZoom ($249 + State Fees)
How to Form an LLC in Colorado in 6 Steps
In order to form your LLC in Colorado, you will need to complete the following steps:
- Name Your LLC
- Choose a Registered Agent
- File Your Articles of Organization
- File Your LLC Operating Agreement
- Obtain an EIN
- File a Beneficial Ownership Information Report
Step 1: Name Your Colorado LLC
Before you get started, you will need to pick a suitable name for your Colorado LLC.
This will need to comply with all applicable naming requirements under Colorado law and be both succinct and memorable, as this will make it easily searchable by your potential clients.
1. Important Naming Guidelines for Colorado LLCs:
- Your name must include the words “limited liability company” or an applicable abbreviation. Examples include “Ltd. liability company,” “limited liability co.”, “limited”, “L.L.C.”, or “LLC”.
- Your name cannot include words that could confuse your LLC with a state or government agency, such as “State Department”, “FBI”, and “Treasury”.
- Certain restricted words may require additional legal paperwork and/or approval from a state agency in order to be allowed. Examples include “Bank”, “Attorney”, and “University”.
For a full list of these rules, have a look at the official Colorado Business Naming Guidelines.
2. Is the name available in Colorado?
To check whether your desired name has already been taken by another business entity in Colorado, you can perform a business name search online through the Colorado Secretary of State Business Database Search.
Keep in mind that if you’re not going to start your LLC right away, you may want to consider reserving your name for up to 120 days. You can do this by filing a Statement of Reservation of a Name ($25 fee).
For more information, you can have a look at our Colorado LLC Name Search guide.
3. Is the URL available?
We recommend that you check online to see if your business name is available as a web domain. Even if you don't plan to make a business website right away, this is an extremely important step as it will prevent others from acquiring it, potentially saving you both time and money in the long term.
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Once you have verified your name is available, you may now select a professional service to complete the LLC formation process for you.
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FAQ: Naming a Colorado LLC
LLC is short for “limited liability company.” It is a simple business structure that offers more flexibility than a traditional corporation while providing many of the same benefits. Read our What is a Limited Liability Company guide for more information.
Or, watch our two-minute video: What is an LLC?
You must follow the Colorado LLC naming guidelines when choosing a name for your LLC:
- Include the phrase "limited liability company" or one of its abbreviations (LLC or L.L.C.).
- Do not use words that could confuse your business with a government agency (FBI, State Department, CIA, etc.).
- Receive the proper licensing when using the words such as lawyer or doctor.
If you are having trouble coming up with a name for your LLC use our LLC Name Generator. That will not only find a unique name for your business but an available URL to match.
Most LLCs do not need a DBA, known in Colorado as a trade name. The name of the LLC can serve as your company’s brand name and you can accept checks and other payments under that name as well. However, you may wish to register a DBA if you would like to conduct business under another name.
To learn more about DBAs in your state, read our How to File a DBA guide.
Step 2: Choose a Registered Agent in Colorado
After you find the right name for your LLC, you will need to nominate a Colorado registered agent. This is a necessary step in your Articles of Organization, which is the document used to file and register your LLC with the Secretary of State.
What is a registered agent? A registered agent is an individual or a company that is your LLC’s official point of contact with the state in order to receive state documents and service of process. You can think of your registered agent as your LLC’s main point of contact with the Secretary of State.
Who can be a registered agent? A Colorado registered agent can be either an individual or entity, as long as the following requirements are met:
- Individual: Must be over the age of 18 and reside in the state of Colorado
- Business Entity: Must have a usual place of business in Colorado or – if a foreign business entity – be authorized to transact business in Colorado.
FAQ: Nominating a Registered Agent
Yes. You can be your own registered agent as long as you are over 18 years old and are a resident of the state of Colorado.
Have a look at our Can I Be My Own Registered Agent article for more information.
Using a professional registered agent service is an affordable way to manage government filings for your Colorado LLC. For most businesses, the advantages of using a professional service significantly outweigh the annual costs.
For more information, read our article on Colorado registered agents.
Step 3: File Your Colorado LLC Articles of Organization
To register your Colorado LLC, you will need to file the Articles of Organization with the Colorado Secretary of State. You can do this online.
Before getting started, you will need to make sure you have all of the information needed to complete your Articles of Organization correctly.
The Secretary of State has a useful LLC Filing Checklist, which includes the following recommendations:
- Check that your LLC name is compliant with Colorado’s naming guidelines
- Ensure that you have a physical street address available; a P.O. box cannot be used as your LLC’s principal office address or mailing address.
- Have all required registered agent information, including your agent’s name, address, mailing address, and consent.
- Know your LLC’s management structure (i.e., manager- or member-managed.).
- Know the full names and legal addresses of the persons forming your LLC.
File the Articles of Organization
File Online With the State of ColoradoFile Online
For help with completing the form, visit our Colorado Articles of Organization guide.
Note: If you're expanding your existing LLC to the state of Colorado, you will need to form a foreign LLC.
FAQ: Filing Colorado LLC Documents
Since Colorado only offers online filing, all LLC applications are processed in real time. This means that there is virtually no waiting time (after payment has been received by the Secretary of State).
For more information, we recommend having a look at our How Long Does it Take to Form an LLC in Colorado guide.
An LLC is referred to as a "domestic LLC" when it conducts business in the state where it was formed. A foreign LLC must be formed when an existing LLC wishes to expand its business to another state.
Read our What Is a Foreign LLC article to learn more.
The cost to start a Colorado LLC is $50.
Keep in mind that this is the cost of submitting your Articles of Organization (i.e., your filing documents) to the Secretary of State and does not include additional costs that you may need to incur (e.g., using an LLC formation service, business attorney, etc.).
For more information, we recommend having a look at our guide on the cost to form a Colorado LLC.
Step 4: Create Your Colorado LLC Operating Agreement
An operating agreement is not required for an LLC in Colorado, but it's a good practice to have one.
What is an operating agreement? An operating agreement is a legal document outlining the ownership and operating procedures of an LLC.
Why are operating agreements important? A comprehensive operating agreement ensures that all LLC owners are on the same page and reduces the risk of future conflict.
For more information on operating agreements, read our Colorado LLC operating agreement guide.
FAQ: Creating a Colorado LLC Operating Agreement
No. The operating agreement is an internal document that you should keep on file for future reference. However, many states do legally require LLCs to have an operating agreement in place.
Step 5: Get a Colorado LLC EIN
You can get a Federal Employer Identification Number (EIN) from the IRS for free. It is used to identify a business entity and keep track of a business’s tax reporting. It is essentially a Social Security number (SSN) for the company.
Why do I need an EIN? An EIN number is required for the following:
- To open a business bank account for the company
- For federal and state tax purposes
- To hire employees for the company
Where do I get an EIN? An EIN, or Federal Tax Identification Number, is obtained from the IRS (free of charge) by the business owner after forming the company. This can be done online or by mail.
FOR INTERNATIONAL APPLICANTS: You do not need an SSN to get an EIN. Learn more here.
Get an EIN
Option 1: Request an EIN from the IRS
- OR -
Option 2: Apply for an EIN by Mail or Fax
Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999
Fax: (855) 641-6935
FAQ: Getting an EIN
A Social Security number is not required to get an EIN. You can simply fill out IRS Form SS-4 and leave section 7b blank. Then call the IRS at (267) 941-1099 to complete your application. Learn more here about applying as an international applicant.
All LLCs with employees, or any LLC with more than one member, must have an EIN. This is required by the IRS.
Learn why we recommend always getting an EIN and how to get one for free in our Do I Need an EIN for an LLC guide.
When you get an EIN, you will be informed of the different tax classification options that are available. Most LLCs elect the default tax status.
However, some LLCs can reduce their federal tax obligation by choosing the S corporation (S corp) status. To learn more, read our LLC vs. S Corp guide.
Step 6: File a Beneficial Ownership Information Report
Beginning January 2024, LLC owners will need to file a Beneficial Ownership Information (BOI) Report with the US Financial Crimes Enforcement Network (FinCEN). Existing LLCs can file their report any time between January 1, 2024, and January 1, 2025, while new LLCs will need to file their report within 90 days of formation.
This contains similar information to that of your Articles of Organization, such as your LLC name and member information, and can be filed online for free. Failure to file an accurate report on time can result in a $500 per day fine.
Note: There are certain filing exemptions, such as for large companies (i.e., more than 20 full-time employees), tax-exempt entities, and publicly traded companies.
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How to Maintain Your Colorado LLC
After you’ve successfully formed your LLC, there are a couple of steps you’ll need to periodically take in order to maintain it, including:
- Filing the periodic report
- Sorting out your taxes
We’ve broken down how to complete each of these steps in greater detail below.
File the Periodic Report
Your LLC will be required to file a yearly periodic report with the Secretary of State and pay Colorado state fees in order to avoid becoming a “delinquent” entity. This report can be filed online alongside a filing fee of $10.
Periodic reports are due within a five-month period that starts two months before your LLC's formation date and ends two months after. To make sure you don’t miss this deadline, you can also sign up to the Secretary of State’s email notification service to receive a notice via email a month prior to your periodic report deadline.
For more information, visit Colorado's Secretary of State website.
Sort Out Your Taxes
Regardless of where your LLC is registered, you will be required to pay certain federal taxes. This includes corporation and employer taxes (for LLCs filing as a C corporation) and federal income tax and self-employment taxes (for LLCs taxed as pass-through entities).
In addition, there are a number of different taxes you’ll be required to pay at a local and state level, which can vary depending on the nature of your business.
Below are some of the most common taxes in Colorado:
In Colorado, there are two main types of taxes imposed by the state government on the earnings of individuals and entities operating within the state. Since 2022, both of these income taxes have been imposed at the same flat rate of 4.4%:
- Personal Income Tax: Refers to the tax paid by individuals and the individual members of LLCs taxed as a disregarded entity (i.e., the default tax election) on their proportion of the business’s net income.
- Corporate Income Tax: A tax levied on the income generated by corporations and LLCs that have elected to be taxed as C corps.
On top of this general statewide rate for income tax, many localities in Colorado levy a local income tax rate on businesses and individuals, including Aurora, Denver, and Greenwood Village (among others).
It’s best to refer to the official body’s website in your local area for the most up-to-date information on its local tax rates and how much your LLC will be expected to pay.
In Colorado, sales tax is applied at a flat rate of 2.9% to the price of tangible goods sold within the state and paid by consumers. However, since many localities in Colorado opt to impose their own additional sales and use taxes, there can be quite a wide variation in the total sales tax your LLC may need to pay, depending on where it’s based.
These local rates typically vary between 0% and 8.3%, with the average falling at 4.89%. As an example, the city of Las Animas levies sales tax at a rate of 4%, while Manassa imposes it at a rate of 1%.
In order to collect and remit sales tax to the Department of Revenue, you’ll need to apply for the Colorado Sales Tax License relevant to the types of goods your LLC sells. For example, businesses planning to purchase items without paying resale must obtain a Wholesale License, while those working from a temporary location away from their usual business premises will need a Single Special Event Sales Tax License.
Note: For the most up-to-date information on the tax rates in effect in your area, use the Colorado Department of Revenue’s Sales Tax Lookup tool.
Steps After LLC Formation
After forming your LLC, you will need to get a business bank account and website, obtain any required business licenses, and get business insurance, among other things.
Visit our After Forming an LLC guide to learn more.