Learn How to Form a Colorado LLC or a Corporation
- Colorado Business Facts and Environment
- Step 1: Decide on a Business Structure
- Step 2: Pick a Business Name
- Step 3: Register the Business
- Step 4: Obtain Your Federal Employer Identification Number
- Step 5: Open Company Bank and Credit Accounts
- Step 6: Set-up An Accounting System
- Step 7: Obtain Licenses and Permits
- Step 8: Hire Employees (if applicable)
- Step 9: Obtain Business Insurance
- Step 10: Systemize and Organize
- Step 11: Branding and Marketing
- Step 12: Annual and Ongoing Requirements
- Important Colorado Contacts
Colorado Business Facts and Environment
CO Business Facts
Colorado is nicknamed The Centennial State, owing to the fact that it joined the United States in 1876, one hundred years after the Declaration of Independence was signed. It’s also known as Colorful Colorado for its beautiful scenery.
Denver, Colorado, is the home of the Cheeseburger. The trademark for the name was registered to Louis Ballast in 1935.
More than one third of the land in Colorado is owned by the United States Government. Colorado is the 8th largest state in the US by land area.
During the late 1880s, Colorado was the nation’s leading silver producer, and one of its primary sources of gold. Due to rich reserves of coal, natural gas, and minerals, Colorado is a major mining state. Currently, real estate, professional and technical services, construction, and tourism are Colorado’s major industries.
Major Companies in Colorado
Pepsi Center is the largest Colorado employer in 2020. Other companies with large footprints are RE/MAX, JBS USA, DaVita, Chipotle Mexican Grill, Pilgrim’s Pride, and Red Robin.
Startup Environment
in 2017, Colorado ranked fourth in the nation for the amount invested in local companies. Denver’s maturing tech scene may shortly be in for a considerable boom, and cost of living in Colorado generally costs less than other states. Additionally, Boulder and Denver between them offer considerable startup resources, and the opportunity to raise a great deal of capital.
Step 1: Decide on a Business Structure
There are 3 basic options: a DBA, a Corporation or an LLC. Click here to learn more about business entities.
- A DBA or “Doing Business As” (also known as a “Fictitious Business Name” or FBN) is not really a separate structure, but just a different name that an individual or partners use as their business name.
- A Corporation is a separate entity (provides liability protection to the owners) that has a structure that includes shareholders, directors and officers. More complex than a DBA but the entity of choice for large companies and startups that intend to raise funding. Some professions are required to choose what is known as a “Professional Corporation” or PC (doctors, lawyers, architects, etc.).
- An LLC or “Limited Liability Company” is a newer type of business that is both a separate entity but provides very easy management (doesn’t require directors or officers) and taxation. Has largely replaced the DBA and Corporation in popularity recently as it provides liability protection but with much less complexity (and taxation) than a Corporation.
Step 2: Pick a Business Name
Picking a business name is easier said than done – many legal and business problems can arise from picking the wrong name (you can always change it later but the less times you have to do that, the better).
- Make sure you’ve covered the basics: unique, easy to understand/pronounce (practice saying it out loud: “Thanks for calling XYZ”) and can survive over time (“DVD World” is not timely). Here are some of our tips on business identity including logo and trademarks.
- Search the web for your proposed name. Search Google, Bing and DuckDuckGo as a “first sweep” for any potential conflicts, especially in your state or local jurisdiction. NOTE: If you intend to operate nationally or even internationally it will be even more important that your name be unique. This should cover many cases where a company name is being used but not officially trademarked (see next tip).
- Do a trademark search with the US Patent and Trademark Office (USPTO). This will be a very good indicator if you’re name will have any conflicts. There’s an art to trademark searches (trademark specialists will charge you handsomely to do a thorough search) but in our experience if you can use google at a fairly advanced level you can reasonably clear a name yourself. Tip: search misspellings, plurals, variations of spelling, sound-alikes and other versions of your chosen name to be sure it’s not already registered.
- Make sure your company name choice is available by searching the Colorado Business Entity Database and doing a name search on the State of Colorado website. Note: Make sure to search variations of spelling, plurals and misspellings as the state may reject a name that is too similar (then you have to start all over again, wasting valuable time). Note: Familarize yourself with the Colorado naming guidelines. LLC entity names need to contain the words Limited Liability Company or the abbreviation LLC, and certain words are restricted or prohibited.
Ready to start a business in Colorado?
Our Colorado filing services will help you get started as quickly as possible.
Step 3: Register the Business
Each state has it’s own requirements for registering a business. Now that you’ve chosen a business structure and picked your business name, here are the requirements to register your business in Colorado.
How to form an LLC in Colorado
- File the “Articles of Organization” with the Colorado Secretary of State.
- Hire a professional Registered Agent.
- Hold an Organizational Meeting to take contributions from the members, issues Member Certificates, adopts the company Operating Agreement and more. (yes, even for 1 person LLCs).
- Optional: Elect S-Corporation status with the IRS by filing IRS Form 2553. Yes, even an LLC can choose to be taxed as an S-Corporation (or even a C-Corporation).
TIP: Speak to your tax advisor about this important issue because it adds complexity to your LLC most people would rather avoid. - Optional: Create an operating agreement. This is a legal document that outlines ownership and operating procedures of your LLC.
How to Incorporate in Colorado
- File the “Articles of Incorporation” with the Colorado Secretary of State.
- Hold an Organizational Meeting to properly organize the corporation, take contributions from the shareholders, elect directors and officers, issues stock, adopts the Corporate Bylaws and more.
- Hire a professional Registered Agent.
- Optional: Corporations can elect S-Corporation status with the IRS by filing IRS Form 2553. Click here to learn more about S-Corporations.
Considerations when Incorporating or forming an LLC in Colorado
- The Colorado Secretary of State could take anywhere from 2-3 business days for e-filing to 3 to 5 days for mail filings to process the paperwork. This may increase during peak periods.
TIP: Check our order form to see how long Colorado is currently taking to process regular and expedited orders. - A Registered Agent is required for every Colorado Corporations and LLC. The chosen registered agent must have a physical street address in Colorado. A professional Registered Agent who will provide their address and forward any important documents to you. This is convenient if you have to move, since you won’t have to file forms or pay fees, (just update your address with your agent).
How to File a DBA in Colorado
- Check your business name by calling the County Recorder or visiting their website (search for “YOURCOUNTY county recorder” should find it).
- Obtain the forms from the county to register your DBA. Each county has its own specific filing requirements, but most accept the online filing options found here.
- File the forms with the County. Some counties require the form to be notarized and published.
- NOTE: In Colorado, businesses have 30 to 60 days during which it can use a DBA without registering with the Secretary of State. After this period, they must register the name or stop using it.
Ready to register a business in Colorado?
Our formation package includes everything you need to get started
- Preparing and submitting Articles of Organization to the state of Colorado.
- All the necessary post-formation documents completed and personalized to you “ready for signature.”
- Our exclusive Startup Wizard – which guides you through the complete startup process from formation to bank accounts, logos and more.
Ready to Start Now? Let Us Do The Work
Sure, you could do all the steps above or you could spend 5-10 minutes on our order form and let us take care of it while you work on more important things.
- Learn more about our business formation service
- Read our verified reviews and 100% Satisfaction Guarantee
- Contact our friendly support team if you have any questions
Step 4: Obtain Your Federal Employer Identification Number
Your EIN is like your Social Security Number for your company. It’s required for Corporations and LLC’s and optional for DBA’s (if you don’t have any employees, then it’s required). However, if you are a DBA and don’t obtain an EIN you will be forced to use your Social Security Number on many documents so it’s typically recommended you obtain the EIN to prevent identity theft.
To obtain an EIN you can apply online with the IRS or via IRS Form SS-4.
TIP: We will obtain your EIN for you if you we form your company.
Step 5: Open Company Bank and Credit Accounts
To keep business and personal expenses separate, you should open a separate account for your business. In addition, getting business credit cards is how you begin to build a company credit profile (corporation or LLC required) and can later qualify for larger loans and lines of credit. To open the account simply call your chosen bank and inquire on the steps to open a business bank account. Typically you’ll need a) your filed paperwork b) your EIN c) a company resolution authorizing your company to open the account (signed by the owners, members, officers or directors, etc.).
Top Business Banks in Colorado:
- Alpine Bank
- ANB Bank
- Bank of Colorado
- Bank of the West
- Centennial Bank and Trust
TIP: Our business formation service includes a free banking resolution for your use.
Step 6: Set-up An Accounting System
Setup your Accounting and Record-keeping system and learn about the taxes your new company is responsible for paying.
Company documents generally are required to be kept for 3 years, including: a list of all owners and addresses, copies of all formation documents, financial statements, annual reports, amendments or changes to the company. All Tax and Corporate Filings should be kept for at least 3 years. View our “Accounting & Financial Management” section for help with setting up an accounting system and purchasing accounting software.
Step 7: Obtain Licenses and Permits
Now that you’ve registered your business name you need to obtain a business license for your company – this authorizes your company to do business in your city or county. Typically this also involves registering for state taxes and permits (the city may require them as part of the business licensing process).
TIP: We work with a company that can obtain and prepare business licenses and permits for you. Click here to learn more.
Step 8: Hire Employees (if applicable)
If you intend to hire yourself or others as a full or part-time employee of your company, then you may have to register with the appropriate State Agencies or obtain Workers Compensation Insurance or Unemployment Insurance (or both). View our “Employees & Payroll” section for help with hiring employees and processing payroll.
Step 9: Obtain Business Insurance
There are many types of insurance for businesses but they are usually packaged as “General Business Insurance” or a “Business Owner’s Policy”. This can cover everything from product liability to company vehicles. A decent policy can run as little as $300/year and offers a great extra level of protection. Click here to view our preferred provider of business insurance online.
Step 10: Systemize and Organize
Prepare the business as if someone needed to take it over and run it for you. This means have a method to process orders, pay bills, pay employees, pay taxes, maintain your permits, etc. Basically, try to make the operational aspect of the business as automated and efficient as possible so you can concentrate on growing your business. View our “Manage Your Company” section for help with systemizing and automating your business.
Step 11: Branding and Marketing
Now that you’ve set-up the company for success, you need to get the word out. Create a marketing plan for your products and services that targets your ideal customer. View our “Marketing & Sales” section for help for more information.
Step 12: Annual and Ongoing Requirements
DBA: Your Fictitious Business Name should be valid for 5 years (unless you change company name or other information listed on the FBN) at which point you’ll need to renew it with the county.
LLC: Colorado corporations are required to file a Periodic Report with the Colorado Secretary of State each year, in addition to general taxation. Information on your business’ taxes can be found here. This report is due on the last day of the second month following the anniversary of the date the LLC was formed. Depending on the nature of your business, you may also need to periodically renew operating permits.
Corporation: Your business must keep corporate records at its principal place of business. Every year, an officer of your corporation must file an annual report on or before the last day of the second month following the anniversary of the date you were incorporated. LLCs and Corporations will pay a filing cost of $10.
Ready to start a business in Colorado?
Our Colorado filing services will help you get started as quickly as possible
Important Colorado Contacts
1700 Broadway
Suite 200
Denver, CO 80290
303-894-2200
Colorado State Taxation Departments
Colorado Department of Licensing and Regulatory Affairs
Colorado State Labor and Employment Departments
Colorado Department of Labor and Economic Opportunity
Colorado Startup Resources
1. Colorado Small Business Administration
Small Business Administration (SBA) Colorado State District Office
2. SCORE Mentors
Active and retired business people volunteer through SCORE to support startup businesses. Learn from the experts and connect with a local mentor.
- Colorado Business Portal
- Colorado Small Business Development Center
- Colorado Job Link Employer Portal
- Tax Information For Colorado Businesses
3. Colorado State Legal Statutes:
- Colorado Business Corporation Act
- Colorado State Limited Liability Companies – the specific act that applies to Colorado State LLCs.
- Colorado State Businesses and Professions – includes regulations on topics such as business and professions codes.
4. Colorado State Chambers of Commerce
5. Angel.co Colorado State Startups
6. Colorado Business News
7. Colorado State Small Business Development Center
8. Colorado Green Business Initiative
