How To Start An LLC in Colorado: Ultimate Guide

Content

Do you want to start an LLC in Colorado, and do you need a guide? Don’t worry; we got you covered. 

Starting an LLC is easy if you go through this guide on how to start an LLC in Colorado. 

All LLC formation in the United States requires some steps and requirements. 

So this article will expose you to the simple steps on how to start an LLC in Colorado. 

How To Start An LLC In Colorado

To start an LLC in Colorado, you must go through some steps and meet all the requirements. 

You must also file the Articles of Organization online with the Colorado Secretary of State

The Articles of Organization is an official document for your Colorado limited liability company.

You can file this document for $50 online. 

Steps to Start an LLC in Colorado

To start your LLC in Colorado, here are easy steps you to follow below: 

  • Select a Name For your LLC
  • Appoint A Registered Agent in Colorado
  • File the Articles of Organization
  • Create an Operating Agreement
  • Get an Employer Identification Number (EIN)

However, if you find these steps daunting, you can seek professional services. 

Select a Name For your LLC

To start with, you must choose a name for your company in Colorado. 

However, ensure the names you desire haven’t been chosen and are easy to search for. 

Meanwhile, there are requirements when selecting a name for your LLC. 

Here are some guidelines to follow when choosing a name for your LLC:

  • Your business name must include ability company” or its abbreviations (LLC or L.L.C.). 
  • Ensure that your name is distinguishable from any other Colorado limited liability company, corporation, limited partnership, or registered limited liability partnership business name. 
  • Ensure the name you desire isn’t already taken by doing a Business Entity Search on the Colorado Secretary of State’s website.
  • Your business name cannot contain words used to name a government agency (i.e., State Department, CIA, FBI, Treasury, etc.)
  • Also, it can’t contain certain restricted words like bank, lawyer, attorney, credit union, etc.
  • Ensure to Reserve the name once you find the availability: You must complete the Name Reservation Request for Domestic Entities form at least two weeks before registration or reserve your business name when completing the online LLC registration.
  • Consider if the URL is available: Check online to see if your business name is known as a web domain. If it is, you may want to buy the URL to prevent others from acquiring it.

Appoint A Registered Agent in Colorado

After choosing a name following the requirements, you must appoint a Registered Agent for your Colorado LLC.

A registered agent is a person or business entity that can receive necessary tax forms, legal documents, a notice of lawsuits, and official government correspondence on behalf of your business. 

Your registered agent must be a full-time resident of Colorado or a corporation authorized to conduct business in Colorado. 

Also, you may appoint an individual within the company, including yourself, to serve as the registered agent as long as: 

  • They provide registered agent services.
  • They have an address in California.
  • They are on-site and available to accept documents during regular business hours.

File Your LLC Articles of Organization

To register your LLC in Colorado, you must file the Articles of Organization with the Colorado Secretary of State

You can only apply online with a non-refundable fee of $50.

Create Your Operating Agreement

Even though operating agreements are not a must for LLCs in Colorado, it is recommended and good practice to get one. 

An operating agreement is a legal document stating the ownership and operating procedures of a limited liability company. 

However, it ensures that all business owners are on the same page and reduces the risk of future conflict.

Get an Employer’s Identification Number

Employers Identification Number is a nine-digit number assigned by the Internal Revenue Service (IRS) to help specify businesses for tax purposes. 

Also, It is virtually a Social Security number assigned for businesses. 

It can also be referred to as a Federal Tax Identification Number (FTIN).

The Employers Identification Number is required to: 

  • Open a business bank account
  • File and manage Federal and State Taxes
  • Hire employees

However, you can get EIN free via the online or email process.

You can request for EIN by sending mail to:

Internal Revenue Service

Attn: EIN Operation

Cincinnati, OH 45999

Fax: (855) 641-6935

What To Do After Forming an LLC in Colorado

Having learned how to start an LLC in Colorado, it is essential to protect your business.  

You can protect your business by carrying out some legal steps and also separating your personal and business assets to avoid the risk that your LLC is sued. 

You can also follow these steps below to protect your LLC in Colorado:

Get a business credit card

Getting a business credit card helps you separate all business expenses for end-of-year tax purposes.

It also helps you build your business credit score, which is essential for getting a line of credit or business loan. 

In addition, it allows you to keep track of department expenses by issuing multiple cards to your employees.

Hire a Business Accountant

To prevents your business from overpaying on taxes while helping you avoid penalties, fines, and other costly tax errors, you may have to hire a business accountant. 

Doing this makes bookkeeping and payroll easier, giving you more time to focus on your growing business 

Furthermore, it helps you manage your business funding more effectively, discovering areas of unforeseen loss or extra profit

Get Your Business Insurance

Getting business insurance helps you manage risks and focus on growing your LLC. 

The common types of business insurance are:

General Liability Insurance: This broad insurance policy protects your business from lawsuits. 

Professional Liability Insurance: This business insurance is for professional service providers (consultants, accountants, etc.) and covers malpractice claims and other business errors.

Workers’ Compensation Insurance: This type of insurance provides coverage for employees’ job-related illnesses, injuries, or deaths. In Colorado, businesses with one or more employees, excluding officers and LLC members, must have workers’ compensation insurance.

Create Your Business Website

To legitimize your business, you need to create a business website. 

Every business needs to have a website to avoid missing out on a large percentage of potential customers and revenue. We have written an article on how to create a website with WordPress in the past, you might want to check it.

Send Out a Press Release

To provide publicity, you need to do press releases to promote your business. 

This is because they are also one of the most cost-effective strategies to establish your brand presence on the web. 

Keep Your Business Licenses and Permits

You must comply with federal, state, and local government regulations to operate your business in Colorado. 

You must obtain and keep your business licenses and permits from your state. 

Tax Filing Requirements

Depending on the nature of your business, you may have to register for one or more forms of state tax.

You must register for sales tax if you are selling a physical product; you’ll typically need to register for a seller’s permit online through the State of Colorado’s website.

Employer Taxes

If you have employees working in your LLC in  Colorado, you must register for Unemployment Insurance Tax and Employee Withholding Tax online through the State of Colorado’s website.

File Your Annual Report

You can file an Annual Report Online with the State of Colorado for a nonrefundable fee of $10.

How to Start A Foreign LLC in Colorado

If you have an existing LLC and you want to extend the business to Colorado, you need to register as a foreign LLC. 

This is because forming a foreign LLC allows your company to operate as one entity in multiple states. If you have an existing LLC and want to do business in Colorado, you must register as a foreign LLC. This can be done online.

You can do this by filing online with the Colorado Secretary of State for a nonrefundable fee of $100.

How to Obtain a Certificate of Good Standing in Colorado

With a certificate of good standing, your business is verified that it was legally formed and adequately maintained in Colorado. 

Meanwhile, you can order a Colorado LLC Certificate of Good Standing online for free. 

How to Dissolve an LLC in Colorado

If you no longer wish to continue with the business at any point in the future, it is essential to dissolve it officially. 

This is important as it may lead to tax liabilities and penalties or even legal trouble. However, you can dissolve your LLC in Colorado in two broad steps, which are: 

Close your business tax accounts

File the Articles of Dissolution

You may have to follow the Colorado LLC dissolution article if the need arises.

Conclusion

We hope this article answers your questions on how to start an LLC in Colorado. 

Don’t forget to share if you find it helpful. 

How to start an LLC in other states of the United States

Leave a Comment