How to Start Your Own LLC in Colorado

This detailed step-by-step guide explains exactly how to form your Colorado LLC—from choosing a business name to meeting ongoing compliance requirements.

1. Name Your Colorado LLC

Choosing a business name can be one of the most challenging steps. Your LLC name should be unique, memorable, and clearly reflect what your business does. To come up with the right name, consider the following approaches:

• Define Your Business Concept: Be clear about what your company will offer before settling on a name.
• Ask for Input: Get feedback from people you trust by sharing your business idea and name options.
• Search Online: Look up potential names to see if domains are available or if similar businesses already exist.
• Use a Business Name Generator: These tools can help spark ideas, though they shouldn't replace your own judgment and creativity.

Your business name is a key part of your brand identity and often the first impression customers have, so take your time choosing the right one.

Check Name Availability in Colorado

Once you have a few options, check availability by conducting a business name search on the Colorado Secretary of State website. Also search for similar names to avoid confusion with existing businesses.

Colorado LLC Naming Rules

Make sure your name complies with Colorado LLC naming rules:

• The name must include "limited liability company" or an abbreviation such as LLC or L.L.C.
• It cannot contain words that imply affiliation with a government agency.
• Words such as bank, insurance, or university require state approval.
• The name must not violate Colorado law and must be distinguishable from other registered businesses in the state.

Check Federal Trademarks

After confirming state availability, search the U.S. Patent and Trademark Office database to ensure the name isn't federally trademarked.

Reserve Your Colorado LLC Name

Once everything checks out, you can reserve the name with the state. Visit the Colorado Secretary of State website and begin the name reservation process.

You'll enter your desired name, click Next, and complete the Statement of Reservation of Name by providing the required information. Review your submission and proceed to payment.

• Name reservation fee: $25
• Reservation period: 120 days

Doing Business As (DBA)

If you want to operate under a name different from your LLC's legal name, you'll need a DBA. Common reasons for using a DBA include:

• Expanding into new product lines (for example, "JJ's Waffles" adding "JJ's Muffins")
• Accepting payments and opening bank accounts under the DBA name

In Colorado, a DBA is called a trade name. To register one, visit the Secretary of State's File a Form page, select Trade Name, and choose "a Reporting Entity."

Trade name filing fee: $20

2. Select a Registered Agent

Every Colorado LLC must appoint a registered agent to receive official documents such as legal notices, tax correspondence, and government filings.

Registered Agent Requirements

A registered agent in Colorado must:

• Be at least 18 years old
• Have a physical street address in Colorado
• Be available during normal business hours
• Be authorized to operate in Colorado if it's a business entity

You may act as your own registered agent, but you must be present at the registered address during business hours. Many owners choose a professional registered agent service for convenience and compliance support.

3. Determine Your Management Structure

LLCs can be structured as either member-managed or manager-managed:

Member-Managed LLCs

• Owners handle daily operations and decision-making.

Manager-Managed LLCs

• One or more managers oversee operations, and members may remain passive investors.

A member may serve as a manager, but only alongside at least one non-member manager.

Member-managed LLCs are typically best for small businesses where owners want to be actively involved. Manager-managed LLCs work well when some members prefer not to participate in daily operations.

Most Colorado LLCs are member-managed. You must specify your management structure when filing your Articles of Organization.

4. File Articles of Organization with the Colorado Secretary of State

To officially form your LLC, you must file Articles of Organization online with the Colorado Secretary of State. The filing requires the following details:

• LLC name
• Principal office address
• Registered agent information
• Registered office address
• Organizer's name and address
• Management structure

During the filing process, you'll also indicate whether your business is a professional service LLC for licensed professionals such as doctors or attorneys.

The application is completed across multiple online screens, and you'll have the opportunity to review all information before submitting payment.

Filing Fee & Processing

• Filing fee: $50
• Processing time: Immediate approval (online filing only)

Mail filings are not accepted.

Contact Information – Colorado Secretary of State

Colorado Secretary of State Website
1700 Broadway, Suite 550
Denver, CO 80290

Phone: 303-894-2200
Fax: 303-869-4864
Email: business@coloradosos.gov

5. Draft an Operating Agreement

An Operating Agreement outlines the ownership structure, responsibilities, and internal rules of your LLC.

Colorado does not legally require an operating agreement, but having one is strongly recommended—even for single-member LLCs.

Typical Operating Agreement Sections

• LLC name and principal address
• Duration of the LLC
• Registered agent details
• Membership information
• Management and voting rights
• Profit and loss allocation
• Procedures for changes or amendments
• Dispute resolution and legal provisions
• Recordkeeping and communication guidelines

Templates are available online, but an attorney review is advisable to ensure accuracy and enforceability.

6. Get Your Employer Identification Number (EIN)

An EIN is issued by the IRS and used for tax purposes. You need an EIN if your LLC has more than one member or if you plan to hire employees.

When applying, you must identify a responsible party—an individual who controls or manages the LLC and its finances. This person must provide a valid SSN, ITIN, or EIN.

7. Obtain Business Licenses and Permits

Depending on your business activities, you may need licenses or permits at the federal, state, or local level.

Common Requirements

• Federal licenses: May apply to regulated industries; consult the SBA and OSHA guidelines.
• State licenses: Available through the Colorado Department of Regulatory Agencies (DORA).
• Sales tax license: Required if selling taxable goods or services.
• Local permits: Check city or county requirements where you operate.

Common licenses and permits include:

• Professional and industry-specific licenses
• Zoning and building permits
• DBA registrations
• Health and safety permits
• Fire and signage permits

Operating without required licenses can lead to fines and penalties. Legal or professional assistance may help ensure full compliance.

8. Determine Your Tax Status

By default, LLCs are taxed as pass-through entities, meaning profits and losses pass directly to the owners.

Default Tax Treatment

• Single-member LLCs: Taxed as sole proprietorships; income is reported on Schedule C, and self-employment taxes apply.
• Multi-member LLCs: Taxed as partnerships; the LLC files Form 1065, and members report income via Schedule K-1.

Optional IRS Elections

LLCs may elect corporate taxation:

• C-Corporation: Profits taxed at the corporate level (21% as of 2022), with dividends taxed again at the individual level.
• S-Corporation: Owners receive a reasonable salary subject to payroll taxes, while remaining profits avoid self-employment tax.

LLC Overview in Colorado - Other Requirements

Open a Business Bank Account

Keep personal and business finances separate to protect liability status. Banks typically require your EIN and Articles of Organization.

Apply for a Business Credit Card

Helps build business credit and manage startup expenses.

Get Business Insurance

Coverage options include general liability, professional liability, workers' compensation, property insurance, commercial auto, equipment breakdown, and business owner's policies.

Maintain LLC Records

Store formation documents, operating agreements, contracts, and financial records securely.

Annual Reporting (Periodic Report)

Colorado LLCs must file a Periodic Report each year to remain in good standing.

• Fee: $20
• Due date: End of the LLC's anniversary month

Colorado LLC FAQs