How to Form an LLC in Colorado (the 5 steps)

How to Form an LLC in Colorado (the 5 steps)


Hey, folks, Matt Horwitz at llcuniversity.com. I hope you’re doing well. How to form an LLC in Colorado. I’m going to run through the five steps with
you. Don’t worry, I’m not cheating. I actually wrote this. Notes are really helpful for me. We teach in all 50 states. Rather than keeping all of this stuff memorized
in my head, I don’t want to sound like an idiot, so I’m going to read this off to you. If you don’t know what an LLC is, it is a
type of legal business structure that’s created under state law. This video is specific to Colorado. There are five steps to forming an LLC in
Colorado. Let’s run through them. First, you’re going to choose your LLC name. We’ll go into more details in a second. First, you’re going to choose your name. Number two, you’re going to select your LLC’s
registered agent. I’m going to debunk a lot of myths there. Number three, you’re going to file the articles
of organization with the Colorado Secretary of State. The cost is $50. Step four, you’re going to complete an operating
agreement. Step five, you’re going to get your LLC’s
EIN. Then after your LLC is formed, there is two
more steps: filing the Periodic Report and filing your state taxes. Let’s start with step #1: choosing a name
for your Colorado LLC. I’m just going to go through the highlights
here. You need to have the abbreviations LLC or
L.L.C. at the end of your name. You cannot use the words Corp or Inc or Incorporated
or Incorporated at the end of your name. You can’t use the words like Bank and Insurance
or any of the restricted names. We have another video on our channel and on
our website that walks you through how to search the Colorado Secretary of State Business
Entity Search to make sure that your desired name is distinguishable. Some other tips when choosing a business name:
make sure that’s creative, try to pick a name that’s easy to spell and short, not something
really long because that’s going to make your domain name. Anytime someone mentions your business, it’s
going to be really confusing. Try to pick a name that has a positive connotation
and shows your business in a good light. The link for the Colorado Business Entity
Search is either below this video or on our website, depending on where you’re watching
it. If you have any questions, just call the Colorado
Secretary of State phone number below this video. The second step, after you’ve found your name,
is to choose your LLC’s registered agent. Most people are massively misinformed when
it comes to choosing a registered agent. So many other websites lie and hide the fact
that you can be your own registered agent. They say things like, “Your LLC is required
by law to have a registered agent,” period. They don’t tell you, “Yes, that is the law,
but in Colorado, Colorado is unique. Your own LLC can serve as its own registered
agent, and you can be your own registered agent. A friend or family member can be the LLC’s
registered agent. The only requirement is that they have a physical
street address-no P.O. box-a physical street address located in the state. If you don’t have a friend or a family member
or you yourself that have an address in the state, then we recommend that you hire a commercial
registered agent. We recommend Northwest Registered Agent, the
best company in the business in my opinion, $125 a year. All that information if below. Really, a registered agent is just a fancy
name for a person or a company who agrees to accept of service of process, which is
legal documents like a subpoena or a complaint or a summons, in case you get sued. Hopefully, you don’t. They just agree to accept that on behalf of
the LLC. That’s what a registered agent is. For most of you, that cost is going to be
$0. Don’t believe all the hype and bullshit you
see in the internet. Third step is filing your formation documents
with Colorado. In Colorado, it’s called your articles of
organization. Colorado is a very affordable state. It’s $50 to form an LLC in Colorado. It can only be done online in Colorado. Colorado is very unique and very advanced. You cannot form your LLC by sending the docs
in the mail. It’s all done online. You’ll pay with a debit or a credit card. The articles of organization is pretty simple. They’ll have the name of your LLC, your name,
your address, the registered agent’s name and address. We have another video that will walk you through
step-by-step exactly how to file that with the state. The coolest thing about Colorado is when you
file online, your LLC is literally is instantly approved at the end vs. a lot of other states
where you have to wait days or weeks for approval. Colorado is definitely up there in the books
as one of the top states. Once your LLC articles of organization are
approved at the state, the next step is to complete your operating agreement. The operating agreement is a contract between
the members of an LLC. It’s still good to have even if you have one
member for liability. Reasons: it basically spells out who owns
the LLC, how much of the LLC do they own, how are taxes, how are profits and losses
distributed, etc. You can download a free operating agreement
template from our website and just fill in the blanks. It’s super easy. Again, we have another video on that. That’s your operating agreement. Then you’re going to get your EIN. This is step 5. Your EIN, employer identification number,
it’s also known as your federal tax ID number. They’re all teacher same thing. Think of it as a social security number but
for the business. It identifies your business with the IRS. You’re going to use it to pay taxes, open
a bank account, handle employee payroll, and you might need it for some business licenses
and permits. This is completely free, $0. You can get it from the IRS via their online
application. We’ll walk you through that step-by-step. Takes about 15 minutes. The only thing you want to make sure, is make
sure that your LLC is approved before you get your EIN. A lot of people make a mistake of they get
the EIN at the same time they’re doing to LLC, they’ll do it ahead of time, and they
get the EIN attached to the wrong LLC name or they think they’re doing it correctly but
they end up getting the EIN for themselves. There’s just a Sole Proprietorship, and then
their assets aren’t protected. Anyways, getting your EIN is really simple. It’s really straightforward. IRS website; takes 15 minutes. We’ll walk you through it step-by-step. That’s pretty much all it takes to form an
LLC in Colorado: 50 bucks. It’s ridiculous. It’s online. It’s very fast. After your LLC is formed, you have two things
to take care of. These are called post-formation requirements
or how do you maintain your LLC. The first one is called, in most states, it’s
called an annual report. In Colorado, it’s called a Periodic Report. It’s due once a year. The annual fee is $10. Come on, it’s ridiculous. Colorado is such an awesome state. Again, this is filed online with a debit or
a credit card. You have this thing called your periodic month. Think of this as a fancy word for your anniversary
month. If your LLC was filed in June, June is your
anniversary month. So every year, that’s your periodic month. You can file your Periodic Report during that
month, two months before or two months after. You basically have a five-month window to
file that, pay the $10. If you miss that five-month window, you have
an additional 60 days where you can file. You have to pay a $50 late fee. Then if you miss that, your LLC goes into
a delinquent and non-compliant status, and eventually you can’t do business in Colorado. Then you need to file your Colorado state
taxes. Form 104 is the form in Colorado. Pretty simple. Just have your accountant or tax professional
make sure you file your taxes every year. Those are the only two things you need to
do to keep your Colorado LLC in compliance. Other than that, let us know if you have any
questions. Hopefully, that simplifies the process of
the five steps to form an LLC in Colorado. Again, Colorado is one of my favorite states
just because it’s all online. It’s super easy. It’s quite affordable. Check out the other videos on our channel. Check out the videos on our website. We’ll walk you through everything for free
step-by-step. No hook; no catch. All right. Let us know if you have any questions. Hope this information is helpful for you.

33 thoughts on “How to Form an LLC in Colorado (the 5 steps)

  1. What if I got the EIN from the IRS before geting registered with the Colorado state. It wasn't a LLC, so how do I get this fixed up with the IRS and the Colorado state?

  2. Great info! Iโ€™m wondering, if i use an LLC for my real estate investing, does that affect my credit score? How does that work?

  3. I was convinced until the foul language.

  4. This was awesome. Fast and efficient. Paired with the article with links it was perfect. Got it done.

  5. My husband just created his own company and your videos helped US so much!! Thanks for the explanations and examples. Your help literally made it super easy for this new chapter in our lives!

  6. Great video, articulate and solid info, thank you!

  7. If i pay for registered agent services, they they do the whole 9 yards?

  8. This was so helpful!

  9. Hey folks, make sure to check the site for most up-to-date information: https://www.llcuniversity.com/how-to-form-an-llc-in-colorado/. Or select your state and start forming your LLC with our free guides: https://www.llcuniversity.com/

  10. Thank you for making this video!

  11. Love and appreciate all your videos! All information is clear and to the point, truly awesome, Thank you

  12. I'm starting a new cleaning business in Denver. This information was so helpful!

  13. So Iโ€™m a little confused. You said that once you file the articles of organization and submit it your lllc is instantly approved. But then you say to make sure your llc is approved before getting your ein number from the irs? So I already filed the articles of organization and got an email saying itโ€™s been filed. Will I get something else later to know itโ€™s been reviewed and approved? Or is it approved right away and I can go ahead and get the llc ein now? Thanks for the reply in advance ๐Ÿ™‚

  14. This video just saved me a lot of reading and time. Thank you so much for this!

  15. Soooo helpful. Thank you!

  16. Thanks to God and your video, I registered my business today! Many blessings to you in the new year! Thank you and my God bless you greatly. ๐Ÿ™‚

  17. Hey guys. Great video! Quick question, I started a business last year, and operated as a sole proprietor. I did not make much money, as it was a side gig. Now I am transitioning into becoming an LLC. How do I properly attach my existing EIN to my LLC? Also can we discuss this somewhere else? Email?

  18. This video just saved me a lot of anxiety from trying to make sure I did everything correct and checked al the boxes. Thank you so much!!

  19. You the bomb!

  20. Hi, my business partner is in Nebraka. Should we create an LLC on CO and NE under the business name to cover both or just one state? We will be independent contractors under a drop ship company who does not charge sales tax per law they said. I'm assuming we should we still set aside an amount to cover CO tax correct?

  21. Thank you for this video. It was super helpful.

  22. NorthWest. I use them too

  23. Great Video! Thank you… So, after performing all 5 steps to form an LLC in CO as my own agent and with no employees, if I make $0 revenue the first year, would I owe any taxes? (I apologize if this seems like a dumb question)

  24. Gosh you have saved me so much time and money. So much gratitude.

  25. is the LLC an incorporated business ? We need to get into some business but it requires an incorporated business which I can't find on the Colorado secretary of state web site.

  26. Super helpful! Thank you very much!

  27. Great video. Thank you.

  28. Wow, thank you so much for sharing this information, you are awesome!!

  29. This video is everything. I got everything set up from name to EID in like 20 – 30 minutes. So easy. Thanks!

  30. The video was very helpful. I am going to get started now, but I do have one question. If you have an LLC, can you be the legal owner and do business under another name and still have the protection? I have known Corporations to have a DBA. I was not sure if you can have a DBA with an LLC

  31. What do you recommend for someone starting an LLC who no longer lives in the US? My business is online but I live in Mexico now. The last state we lived in was CO but we have family in KS so we may move back there in a few years. Does it make sense to form the LLC in CO for now or form it in KS? Would I just re-register it in whatever state I end up moving to to avoid franchise fees? Thanks for all of your advice!

  32. So when i go to look up the company name that i want with colorado to see if its available it has to have L.L.C at the end?

  33. Thanks super helpful!

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