State of Colorado Business Registration
State of Colorado business registration allows your company to operate in the state, whether you are based in Colorado or elsewhere.3 min read
2. Choosing a Name
3. Tax Registration
4. Sales Tax
6. Licenses and Permits
State of Colorado business registration allows your company to operate in the state, whether you are based in Colorado or elsewhere. Corporations, limited liability companies (LLCs), nonprofits, and partnerships have to complete registration with the Colorado Secretary of State.
Registering Your Colorado Business
You can fill out an electronic application on the Secretary of State website. You do not need to register if you are a sole proprietor since profits are reported as your income. However, you are also responsible for business debts and obligations.
Choosing a Name
You can register a trade name as a sole proprietor through the Colorado Secretary of State. Complete a records search to ensure that the name you want isn't already taken by another state business. You should also take this step if you're planning to incorporate in Colorado.
Although Colorado does not require a business license, you must register your trade name. This can be done online and carries a fee of $1.
New Colorado businesses must register for certain types of taxes depending on the products and services they provide. Most businesses must register for sales and use tax and wage withholding taxes. Other types of taxes that may apply include:
- Cigarette and tobacco tax
- Liquor excise tax
- Fuel excise tax
- Severance tax
The state Department of Revenue Division of Taxation can provide more information about these requirements. You can also download electronic forms from the site.
Even if your business is located elsewhere, you will need to register to collect Colorado sales tax if you have a nexus in the state. This term refers to a physical warehouse or inventory location but does not require a physical presence. The Department of Revenue determines whether your business has a nexus in Colorado.
To register for sales tax, you'll need to apply with your business name, type of entity, description of activities, date you plan to begin or began business activities in Colorado, the physical address and mailing address, contact information, the appropriate North American Industry Classification System code, federal employer ID number, employment information, and details about owners, members, and managers.
The cost for a Colorado sales license is $50. If you purchase a business that is already registered with the department, you will still need to obtain your own sales license.
If your Colorado business has employees, you will need to save records for at least four years that include your tax ID number, complete employee personal and contact information, pension payment data, and allowance certificates for tax withholdings. These records allow you to monitor the growth of your business.
When you hire a new employee, you must have the individual complete Form W-4 for withholding exemptions, which is then sent to the IRS. In Colorado, you must also collect Form W-2 and send it to the Social Security Administration.
These forms must be completed by the end of March if you are submitting electronically. Employees will receive copies of their W-2 forms in January of the following year.
The state also requires new employees to complete Form I-9 within three days of starting work. This provides proof that the individual can legally work in the U.S. You must keep this form on file.
You must report any new employees to the state's Directory of New Hires within 20 days of their hire date. Provide the person's name, address, and tax ID number along with your payroll address and tax ID number.
You are also required to pay workers compensation and unemployment tax to the state.
Licenses and Permits
The types of permits and licenses you'll need for your Colorado business depend on the type of business and the services you offer. Common examples include:
- Wine and beer licenses
- Bingo and raffle licenses
- Construction and plumbing permits
Visit Colorado.gov and click on "Get Licenses and Permits" to register for the documents you need. You can also get general information about registration and background checks.
You may also need to get separate licenses and permits from your county or city government. These may include:
- Alarm permit
- Building permit
- Health permit
- Zoning permit
- Occupational permit
- Sign permit
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