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Requirements for filing Limited Liability Company in the State of Colorado

One or more person can form an LLC in the Colorado by filing Articles of organization.

Initial requirement for filing for an LLC?

The first and foremost requirement for creating your LLC is to be filed an article of organization. An article of organization is a formation document that defines how a company is run, operated and owned. It contains the rules for the internal affairs and management of the company and the rights and duties of the members. It includes the following information:

  • Name of your business; Your Business name contains word LLC, L.L.C. Or a Limited Liability Company and should not include words like Inc or incorporated or should not use words like bank, insurance.
  • Complete mailing address of the principal place of business in Colorado, and P. O. Box is not allowed.
  • Complete name and mailing address of the registered agent of the LLC. A statutory agent can be an individual, or a corporation or an LLC that is authorized to transact business in Colorado.
  • The Original name and mailing address of the person forming the LLC.
  • Delayed effective date; i.e. a future date when you want to start your business as an LLC. Please leave this column blank if you do not have a delayed effective date.
  • You have to disclose on Articles whether your LLC is a member managed or manager managed. A member managed LLC have at least one member and give members an authority to act on behalf of the LLC.
  • Similarly, if you have a business structure where decisions are taken by the manager, then you are running manager managed LLC. Your company will be having at least one manager who has authority to act for the LLC and most day-to-day decisions are made by a majority vote of the managers, with each manager having one vote.
  • You can only file articles of organization online. There is no option to file it manually or by mail.
  • The State cost of filing articles of organization is $ 50 which can be paid through debit or credit card. Please note that this fee is non refundable.
  • Colorado, LLC comes into existence once the application and filing fee is submitted with the secretary of state.

How can I appoint a registered agent?

There is a misinterpretation that you can only hire a registered agent, but it's not true. You can be a registered agent of your own LLC or your own LLC can be its registered agent. Further, a registered agent can also be an individual who is a resident of the State of Colorado or a company whose principal place of business is in Colorado. You can also hire a commercial registered agent.

What are the duties of a registered agent?

Registered agent acts as a liaison between your LLC and corporate matters. It accepts legal documents on LLC behalf and represent company in case of a legal dispute or when company is sued.

Do I need to have an operating agreement in Colorado?

Though the requirement of operating agreement is not mandatory in Colorado, however, it is required for the activities of the business. It is a written agreement between the members of a business regarding the profit and loss sharing, contributions among members, distribution of assets in case of winding up of the business. You can always consult a professional to advise upon whether you need one or not.

There is no State requirement to file an operating agreement with the articles of organization, but same should be kept in a registered place of business. An operating agreement defines each member's limitations and liabilities.

How can I get EIN for my business?

An EIN is your business identification with the IRS to pay taxes, open a bank account. Getting an Employer Identification number for your business is a simple process. You can get it from the IRS website by applying online. Please make sure that your LLC has been approved by the secretary of state before you apply for the EIN.

What are the Post formation requirements for my business?

After your LLC has been approved and formed, there is a requirement to maintain an annual report also called periodic report in Colorado which is due annually.

Periodic report is used to keep your business information and details updated with the state. So if there is any change in your business during a year, you update the information through periodic report by filing it online.

The periodic report filing fee is $ 10 annually and it can only be filed online Time to file the report is two months before or after the month of formation of an LLC. For Example: If your LLC was formed in August, periodic report can be filed in June, July, August, September, October. So basically you have five months’ time to file your periodic report in Colorado.

What are the penalties for no or late filing of periodic report?

Late filing of periodic report will impose a penalty of additional $ 40. Failure to submit periodic reports for two months can put a Delinquent and Noncompliant status for your LLC .

What are the taxes my business is subjected to in Colorado?

Depends upon the nature of your business, you are required to register your LLC with the Department of revenue and obtain necessary professional license and seller permits from the respective county and city.

  • Personal Income tax rate in Colorado is 4.63%. You also need to file annual state income taxes on Form 104 by IRS. Due date for filing Income tax returns in Colorado is April 15th, however Colorado offers an automatic 6 months extension to file your income tax return if you cannot submit your return by 15th of April.
  • Sales tax rate is Colorado is 2.9% which can be increased up to 11.2% because of city and county taxes. Sales tax return is required to be submitted on 20th of January annually or 20th of the fourth month quarterly. Late filing may subject your business to a penalty of 10% with additional 0.5% with every subsequent month plus interest.
  • You will also be liable for withholding tax and un-employment insurance tax if you hire staff for your LLC.

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