Colorado Foreign LLC
Colorado is best known for its location in the Rocky Mountains, outdoor activities, and opportunities for growing a business. As the cost of living and doing business grows exponentially in some of the more populous coastal states, more entrepreneurs are starting to look inland for suitable locations to launch a business. With its growing entrepreneurial community and low cost of living, now is a great time to expand your business operations in Colorado.
Already know you want to expand your business and form a Colorado Foreign LLC? Avoid the hassle and hire a professional service like Northwest to handle the formation process.
Colorado Foreign LLC Overview
If you created your limited liability company (LLC) in another state and now want to conduct business in Colorado, you’ll need to register your company as a Colorado foreign LLC. A Colorado foreign LLC allows you to legally transact business in Colorado by expanding your current LLC into another state. Since a foreign LLC is simply an expansion of an existing business, if you don’t currently have a legal business entity and want to begin your business in the state of Colorado, consider forming a traditional Colorado LLC.
This guide will provide the details you need to register your business as a Colorado foreign LLC.
Do I Need to Register My Business as a Foreign LLC in Colorado?
If you plan on transacting business in Colorado, the Foreign Entities provision of the Colorado Corporations and Associations Act states you must register your business as a Colorado foreign LLC. Most states don’t define what transacting business means, but, in general, your business must register as a foreign LLC if you:
- Hire employees or agents to work in the state
- Participate in long-term business transactions or contracts
- Own or lease a warehouse, office, or store in Colorado
- Own income-producing properties personally or professionally
What Happens If I Fail to Register as a Foreign LLC in Colorado?
If you fail to register as a foreign LLC in Colorado, your business can face penalties and fines. You also can’t sue another person or entity if the need arises, such as to collect payment on an outstanding debt or contract. Failing to register your company as a Colorado foreign LLC won’t render any business you conduct as unlawful and all of your company’s contracts will remain legitimate.
How to Register a Colorado Foreign LLC
To qualify as a Colorado foreign LLC, you must file a Statement of Foreign Entity Authority (SOFEA) form with the Secretary of State. Doing so requires you to take several steps, such as appointing a Colorado registered agent, obtaining a Certificate of Good Standing, and completing and filing Colorado’s SOFEA form, which you can only do online.
Recommended: Save yourself the hassle and have a professional service file your Colorado foreign LLC paperwork for you. This’ll ensure everything is done right and give you time to work on what really matters — growing your business.
Appoint a Colorado Registered Agent
Your LLC must have a Colorado registered agent in order to legally conduct business in Colorado. A registered agent is an individual, law firm, or business that’s responsible for accepting legal or state documents as well as paperwork or official notices on your business’s behalf. The registered agent you choose to work with must have a physical address in Colorado where they’re available during normal business hours.
While anyone with a Colorado address can serve as your registered agent, we recommend using a professional registered agent service to keep your address private and ensure someone is always available to receive any important documents.
Obtain a Certificate of Good Standing
You can submit a Certificate of Good Standing for your LLC as a supplement to your Colorado SOFEA form, but it isn’t required as in other states. A Certificate of Good Standing is a document that shows your LLC is up to date on all fees and in compliance with all regulations within its home state.
You can submit your Certificate of Good Standing after you file your Colorado SOFEA form.
Reserve Your LLC’s Name (Optional)
In Colorado, you can file a Statement of Registration of True Name to reserve the true name of your LLC in your home state if it isn’t already in use within Colorado. The registration is effective until December 31 in the year you file, and you must renew this name registration annually. You must file this form online and pay the $25 filing fee.
Complete the SOFEA Form
Colorado only offers online filings. To access the SOFEA form, choose the “File a Foreign Entity” option from the state’s “File a Form” landing page.
Follow these steps to accurately complete each section of the online SOFEA form:
- Entity ID Number, Name, and True Name: In the first section, you must provide the ID number and true name of your LLC (e.g., the name you used to register the business in your home jurisdiction). If your entity’s true name is already taken in Colorado, you can enter a distinguishable name you’ll use when conducting business in Colorado.
- Form of Entity: This refers to the legal type of your business entity. For this example, you’ll select “Foreign LLC.”
- Jurisdiction: Enter your jurisdiction, which is the state or country in which you originally formed your LLC.
- Principal Office Address: Enter your LLC’s primary address, which must be a physical address and not a P.O. Box.
- Date Commencing Business in Colorado: Provide the date you began conducting or plan to start conducting business in Colorado. Use the “mm/dd/yyyy” date format.
- Registered Agent: Provide information about your appointed registered agent in Colorado. Consider using a professional registered agent service.
- Attachments (Optional): In the next section, you can add any attachments. NOTE: You don’t need to attach any documents, such as your LLC’s formation document or Certificate of Good Standing, at this time because you can provide a Certificate of Good Standing after you file the SOFEA form.
- Delayed Effective Date (Optional): Complete this field if you want to delay the effective date for when you’ll start business operations in Colorado. Skip this section if you want the document to become effective immediately. (NOTE: If you accidentally enter a delayed effective date, you’ll need to file a correction with the state.)
- Email Address: Provide an email address to which the Secretary of State’s office can send you reminders to file an annual report that updates your business’s information.
- Filer Name and Address: Enter the name and address of the person submitting the form, which will become public after filing. If more than one person is responsible for filing this form, add an attachment with their name and address.
- Review: In this section, you’ll have an opportunity to review the information you’ve provided online before officially submitting the document. If you don’t see this page, you likely have errors in your document so you’ll need to review it to find and enter the missing information.
- Payment: The final step before you submit your SOFEA form involves paying the filing fee.
- Confirmation: After you make your payment, you'll see a confirmation page showing that the payment was successful. You can select to have a receipt emailed to you if you need a copy. You’ll also have the option to receive a copy of your stamped filed document.
File Your Statement for Foreign Entity Authority in Colorado
After you submit your completed form and the Secretary of State approves it, your company will officially become a Colorado foreign LLC.
The fee for the Colorado foreign LLC form is $100. You can make this payment by credit or debit card or through a prepaid account.
File as a Colorado Foreign LLC
File the SOFEA Form Online With the Colorado Secretary of State
How Long Will It Take Before My Colorado Foreign LLC Is Approved?
It typically takes one business day to process this online form. There are no options for expedited processing in Colorado.
Keeping Your Colorado Foreign LLC in Good Standing
Colorado Periodic Report
Colorado requires foreign business entities to file a periodic report — also known as an annual report — with the Secretary of State’s office every year. You’ll have 10 months to complete this report, which is due no later than two months from your filing date anniversary. The filing fee is $10, and you’ll incur late fees if you don’t file on time.
Colorado Foreign LLC Taxes
Colorado taxes foreign LLCs that operate within the state the same as regular LLCs, which are subject to pass-through taxation. That means your LLC’s profits and losses will pass through to its members’ individual tax returns.
Depending on your business, you may need to pay taxes in Colorado. We recommend speaking with accountant or contacting a lawyer to learn more.