How to Register My Business in Colorado

by Jennifer Kiesewetter in

TLDR

  • When you register your startup in Colorado, you'll need to satisfy several federal, state, and local compliance requirements.  
  • When you register in Colorado, you must determine if your startup is domestic or foreign.
  • As a domestic startup, you’ll file the appropriate form online with the Colorado Secretary of State. For example, as an LLC, you’ll file an article of organization along with a $50 fine.
  • As a foreign startup, you can transact business in Colorado after you file a Statement of Foreign Entity Authority with the Secretary of State.
  • When you’re ready to register your startup, like other states, Colorado requires you to choose a unique business name, differing from any other registered businesses in the state.
  • Depending upon your chosen entity for your startup, you will have filing fees due when registering your business. For example, if you register as an LLC, corporation, or a limited partnership, you’ll pay a fee of $50. If you want to do business in Colorado, but your startup was registered in another state, your fee is $100.
  • Also, depending upon your entity, you may be liable for Colorado’s various taxes, such as the state corporate tax, sales and use taxes, and if you have employees, employment taxes. To better understand your state tax obligations as a startup, you should consult with an accountant familiar with Colorado tax laws.

Colorado has recently become a hotbed for entrepreneurs and startups. According to Crunchbase, many San Francisco tech companies are opening second offices in Colorado, where the talent is top-notch, and the financial outlay is considerably lower. Companies like Facebook, Salesforce, and Google all have secondary offices in the state, with venture capital amounts climbing for startups.

Colorado also tops the list as the best state for women-led startups in 2021, with Washington, Virginia, Florida, and Montana filling out the top five. Furthermore, venture capital is growing in the Centennial State. In 2019, $2.3 billion of venture capital was invested across 357 deals, with Denver receiving just over $930 million.

If you consider registering your startup in Colorado, this article will walk you through what you need to know.

How to Register a Business in Colorado

When you register your startup in Colorado, you'll need to satisfy several federal, state, and local requirements to register your business. However, before registering your startup, it’s a good idea to research the market and potential competitors, map out your financing, plan for operations and personnel, and create a business plan.  Colorado provides various resources to help you start a business, such as the popular Colorado Business Resource Book.

In drafting your business plan, you’ll want to consider marketing, advertising, sales, location, and ownership, to name a few categories. To help guide you, you can check in with the U.S. Small Business Administration or the State of Colorado, providing additional guidance for creating a business plan.

Once you’ve identified some of the basics about your business’s operation, it is then time to register your start-up. Below, we'll address explore the ins and outs of registering your business in Colorado.

Determine Your Business’s Entity Structure

Before you register your startup in Colorado, in addition to creating a business plan, you must also determine your organization's legal ownership structure. For example, in the State of Colorado, you may choose to register as a:

  • S-Corporation
  • C-Corporation
  • Limited Liability Company (LLC)
  • General Partnership (GP)
  • Limited Partnership (LP)
  • Limited Liability Partnership (LLP)
  • Limited Liability Limited Partnership (LLLP)
  • Sole Proprietorship

Your chosen business entity determines the next steps in registering your startup. For example, if you choose a sole proprietorship or a general partnership, you’ll file a Statement of Trade Name, creating an official record of your startup. However, you won’t have to register your business with the Secretary of State’s office.

On the other hand, suppose you choose a corporation for your business structure. You would file your articles of incorporation online, accompanied by a $50 filing fee. Paper filings are not permitted.

Identify Your Registered Agent

You’ll also need to select a registered agent, who is the known contact for your startup, receiving any legal documentation on behalf of your company. You can designate an individual or an entity as your registered agent. In addition, your entity itself can serve as the registered agent.

If you choose an individual, that person must be at least 18 years old, a natural person, and reside in Colorado. If you select an entity to be your registered agent, it needs to be an organization, trust, or estate, with a physical address in Colorado. No matter if you choose an individual or an entity, the selected registered agent must consent to the position.

Submit Your Formation Forms

When you register in Colorado, you must first determine if your startup is domestic or foreign. A domestic entity is an entity originally registered in the state of Colorado.  A foreign entity is an entity formed outside of Colorado. 

As a domestic startup, you’ll file the appropriate form online with the Colorado Secretary of State. For example, as an LLC, you’ll file an article of organization along with a $50 fine. As a foreign startup, you can transact business in Colorado after you file a Statement of Foreign Entity Authority with the Secretary of State.

What to Do Next

After you submit your formation forms and register your startup with the state, you’ll also need to obtain a federal employer identification number for banking and tax filings. Additionally, you’ll need to check in with the state of Colorado and your local city and county to see if there are any additional business registrations required, such as a business license. The  Colorado Secretary of State’s website provides comprehensive checklists for you when launching your startup.

Where Do I Register a Business Name in Colorado?

When you’re ready to register your startup, like other states, Colorado requires you to choose a unique business name, differing from any other registered businesses in the state. For example, Colorado considers the following names distinguishable:

  • "ABC LLC is not the same as ABC Limited Liability Company"
  • "ABC LLC is not the same as A-B-C LLC"

However, Colorado does not consider the following names distinguishable:

  • "ABC Inc is the same as abc inc"
  • "ABC Inc is the same as ABC, Inc."

To confirm if your startup’s name is distinguishable from any other registered businesses, you can use Colorado’s name availability search tool.  Additionally, the Colorado Secretary of State’s site offers additional information on distinguishability.

If you are a for-profit startup and you’d like to use a different name than your business’s legal name or your own name, you may do so by registering your trade name with the state. This is often called a “doing business as” (DBA) name or an assumed name.

How Much Does It Cost to Register a Business in Colorado?

Depending upon your chosen entity for your startup, you will have filing fees due when registering your business. For example, if you register as an LLC, corporation, or a limited partnership, you’ll pay a fee of $50. If you want to do business in Colorado, but your startup was registered in another state, your fee is $100.

Also, depending upon your entity, you may be liable for Colorado’s various taxes, such as the state corporate tax, sales and use taxes, and if you have employees, employment taxes. To better understand your state tax obligations as a startup, you should consult with an accountant familiar with Colorado tax laws.

After submitting your registration forms, you need to learn about any required state or local licenses, such as a business license. You must also understand what annual registrations and fees are required of your startup, such as an annual report, requiring a $10 filing fee.  If you file your report late, you’ll be subject to a $50 late fee.

How Do You Register as a Minority-Owned Business in Colorado?

Colorado currently has 5.2 million self-employed minorities, comprising a number of startups and small businesses. To encourage minorities, women, and veteran-owned startups and small businesses, Colorado has created the Minority Business Office (MBO). The MBO helps these founders to “learn how to best market themselves as a certified business and secure government contracts.”

The MBO also works with state and local chambers of commerce, economic development offices, government agencies, and small business associations, enabling it to leverage resources from across the state. By working with MBO, minority founders can “get in front of the right people and increase prospects locally, nationally, or internationally.”

Additionally, Colorado has other programs and outlets for encouraging minority startup founders, such as the Commerce City Community Bridge Program, the Global Trade Activator Program, the Pathway to Certifications, and the Minority Business Directory.

Benefits of Registering a Business in Colorado

Here are some benefits of registering your startup in Colorado:

  • Colorado has a flourishing economy, with the major metropolitan areas experiencing continued growth.
  • Colorado is home to many advantageous programs for both small- and mid-sized businesses. Some programs include the Colorado Credit Reserve, which helps startups that cannot get access to traditional financing to secure a bank loan. Additionally, startups and entrepreneurs can get access to Colorado Microloans, ranging from $5,000 to $50,000.
  • Colorado has an active and supporting startup community, with plenty of support, insight, and help from other founders of companies of all sizes and stages.
  • Colorado’s tax burden is manageable, and state and local regulations are business-friendly.
  • Boulder and Denver both made Crowdspring’s top 15 list of the best cities in which to launch a startup in 2021 -- outside of Silicon Valley and the East Coast.
  • And don’t forget Colorado’s livability. Colorado is a favorite for outdoor enthusiasts and nature lovers, from the mountains to the canyons to the rivers.
  • Colorado is also reasonably easy to get to by plane, with United, Frontier, and Southwest all having hubs in Denver.

Limitations of Registering a Business in Colorado

Here are some limitations of registering your startup in Colorado:

  • When you have a state that experiences high growth, like Colorado, some drawbacks accompany the upward trajectory. For example, Colorado has a higher cost of living than other states.
  • Additionally, there is a greater demand for both residential and commercial space.
  • Although Silicon Valley seems to be relocating key offices to Colorado, there is less venture capital money in the Centennial State than on either of the U.S. coasts. Because Colorado's business and tech growth are recent, it will take some time for investors to be “all in.”

We can help!

At AbstractOps, we help early-stage founders streamline and automate regulatory and legal ops, HR, and finance so you can focus on what matters most—your business. If you're looking for help registering your Colorado startup, we can get your documentation ready, overall shepherding this process to ensure it's done right. Sign up for early access to get started.

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