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Colorado LLC Formation Costs
Colorado LLC Filing Fees - $50
Recurring Fees - $10 Periodic Report Fee
Filing Time - Colorado LLCs are instantly approved after submitting online with the Secretary of State.
Don’t want to form an LLC by yourself? - Let IncFile guide you through the LLC formation process so you know everything was done right. Only pay state fees!
The Limited Liability Company (LLC) is a popular business entity choice structure for many businesses starting in Colorado. The LLC provides personal liability protection and has the potential to save money on taxes. With a little research, you can learn how to form an LLC in Colorado without an attorney.
Unlike a sole proprietorship or partnership where the small business owner can be held personally liable for lawsuits against the business, the LLC is a separate legal structure, protecting for the business owner’s personal assets.
Related: How Does an LLC Protect You?
Besides the liability protection, the Limited Liability Company provides several other benefits over the sole proprietorship, partnership, and corporation because of the multiple tax options, ease of administration and management flexibility.
Forming an LLC in Colorado is something most people can do on their own, but it’s nice to have some support in case you have questions or get stuck. IncFile and Inc Authority provide LLC formation guidance for only the cost of the state fees!
HOW TO FILE THE ARTICLES OF ORGANIZATION AND FORM A COLORADO LLC
To get started, visit the Colorado Secretary of State.
Step 1: Name the LLC
The legal name of the LLC must include one of the following at the end of the business name:
- Limited Liability Company
- Ltd. Liability Company
- Limited Liability Co.
- Ltd. Liability Co
The name of the LLC also has to not be similar to other registered entities in the state of Colorado. Check on available LLC names in the state database.
Step 2: Principal Office Address
In this section, enter the street address, city and zip cost of the initial principal office. This address can be the physical address of the LLC or it can be the address where the business records are stored. You may not use a PO Box for the designated office.
If you prefer to use a different address than the designated office for correspondence from the Secretary of State, enter that address in the mailing address field. A PO Box is acceptable in this section.
Step 3: Registered Agent
To have an LLC in Colorado, a Registered Agent must be identified. The Registered Agent is either a Colorado resident or a company that provides registered agent services. The agent must have a physical address in the state to act as a point of contact to receive legal documents, tax notices, summons, subpoenas, etc on behalf of the LLC.
Even though any individual can be the registered agent (business owner, member, friend, etc), their name and address become public record and with that comes a loss of privacy. This is more important for some entrepreneurs, especially when they are doing business from home. Hiring a company to be the Registered Agent will reduce the number of unwanted phone calls and mailings.
The registered agent must consent to being appointed as the registered agent and the box has to be checked to confirm that they have agreed.
Step 4: Organizer Information
The name and mailing address of the LLC organizer(s) forming the entity are entered next. If there is more than one member, be sure to click on the Yes button and later you will add an attachment to include the names of all the members.
Step 5: Management
This section asks whether the management of the LLC is Manager-Managed or Member-Managed.
Member-Managed LLCs have an active involvement in the day-to-day operations of the business.
Manager-Managed LLCs refer to an LLC where the members hire somebody to run the company, similar to the position of CEO for a corporation.
Most LLCs are member-managed.
Next, you have to confirm that there is at least one member of the Limited Liability Company by checking the box
Step 6: Additional Information
If there are additional items to attach regarding the formation of the LLC, indicate that additional information needs to be attached.
This isn’t common for most LLCs.
Step 7: Effective Date
If you want the LLC to start on today’s date choose Yes, otherwise select No and enter a date less than 90 days in the future to start.
Some will delay the LLC start date if they aren’t ready to go but want the filing out of the way or if they are close to the end of a calendar year and want to delay until the following year so they won’t have to file business taxes.
Step 8: Email Addresses
Should you want to receive an email instead regarding notices of when a form has been filed, when the status of a record has changed, and when the Periodic Report or renewal is due. Know that the Secretary of State no longer sends a reminder in the mail for the annual LLC renewal.
Step 9: Signatures
Each member of the LLC must certify the information in the Articles of Organization are correct and sign.
All members can sign this document but only one is required to do so. If other members want to sign, upload their names and signatures as an attachment on the next page.
Step 10: Upload Attachments
If you selected to upload additional attachments, they will be uploaded here.
Step 10: Review and Pay
Review the Articles of Organization for any errors and if there are no errors all that’s left is to submit payment.
If you have questions, contact the Colorado Secretary of State.
Colorado Secretary of State
Companies like IncFile and IncAuthority help guide you to make sure it’s done right and you only pay the normal state fees.
Check out our reviews of popular LLC formation services to learn more.
Tasks After Forming An LLC
Once the LLC has been formed, there are a few additional steps to take care of. Below is a list of the most common tasks.
Prepare an Operating Agreement
The operating agreement is a document that governs the framework of an LLC. This document covers items like ownership rights, member responsibilities, how profits and losses are distributed and more.
Most states do not require an LLC to have an operating agreement but it is still worth considering. Without an operating agreement:
- The LLC could be subject to generic state rules that may be detrimental in the event of a lawsuit
- Member’s personal liability protection may be diminished
- Members may not have a full understanding of their roles and responsibilities which could lead to costly disputes in the future
Obtain an EIN
The EIN or Employer Identification Number is a unique 9-digit number for a business. Similar to a social security number for an individual, the EIN identifies business entities for tax purposes.
The EIN will be needed in order to open a bank account, register for business licenses and permits, file tax returns, pay payroll taxes and more.
Related: How to Apply for an EIN
Open an LLC Bank Account
Opening a bank account for your LLC is important for liability protection as the account separates the business’s funds from the member’s personal funds.
Several documents will be needed to open a business bank account such as:
- A banking resolution is a document that authorizes the members to open a business bank account on behalf of the LLC.
- Copies of the original formation paperwork from the state showing the creation of the LLC.
- Driver’s licenses of the members.
- Depending on the age of the LLC, an Colorado Certificate of Good Standing may be needed to prove the LLC is active and in good standing with the state.
Apply for Business Licenses and Permits
Depending on what your business does and where it is located, there will likely be a variety of business licenses and permits to register for before starting. Some common registrations include:
- Business License – Some cities require businesses to obtain licensing before they can start. In some cases, even home-based businesses must have licensing in order to legally operate.
- Professional License – Certain services such as barbershops, accountants, salons and others must be licensed.
- Sales Tax Permit – In order to sell products and certain services, registration with the Colorado Department of Revenue will be necessary.
File Periodic Reports
LLCs are required to file a periodic report annually with the Colorado Secretary of State. The periodic report updates ownership information and other details.