Colorado LLC Annual Fees

Colorado LLC Annual Fees and Requirements

It is common for companies to opt for Colorado as their business location due to the state's low fees. The LLC fees in both Delaware and Nevada cost hundreds more. Even Wyoming, which has a competitive fee, charges twice as much Colorado. Colorado has set a $50 fee to file your LLC.

This allows us to offer low fees when forming a Colorado LLC. Our fee includes the filing fee associated with your Secretary of State and one year of our service as a registered agent. It also covers free forwarding of mail, a business address, the operating agreement, and other expenses.

Following the first payment, you do not have additional taxes, licenses, or fees to pay. By comparison, Nevada's LLCs require multiple fees, with many of them not disclosed at the time of formation.

Find out more about forming a Colorado LLC, registered a Colorado business and our registered agent services.

Annual Fees for Colorado LLCs

Colorado LLCs pay less in annual fees compared to other states as well. The annual fee is just $10, which your Secretary of State receives. This is a fifth of Wyoming's fee, saving you a great deal of money. Additionally, Colorado requires companies to have registered agents in the state. We charge a small annual fee to provide this service.

Keep in mind that the Secretary of State requires an individual's name on the company's annual report. Those who want anonymity can have us file your report. Otherwise, your name will always be part of public records.

We also offer a nominee service for a small additional fee. Between the fees for Colorado's annual report filing, filing the annual report with our name, and serving as a registered agent, your Colorado LLC's annual fees are lower than in other states.

Requirements for Colorado LLCs


There are very few requirements for LLCs in Colorado. It is also possible to create a single member limited liability company. The process of starting and maintaining your LLC in Colorado is easy. To begin, you just need to file the Articles of Organization, which you provide to the Secretary. You do not need any extra business licenses, operating agreements, or additional reports. Those with sales in Colorado do need to contact the Colorado Department of Revenue for Sales Tax Permits.

Even with the comparatively simple process of filing a Colorado LLC, there are important fundamental procedures and policies. As a member, you must observe those procedures and policies to ensure your LLC planning benefits.

Identifying the LLC

LLCs must always be publicly known as Limited Liability Companies. This includes using the registered name, with "LLC," "Ltd.," or "a Colorado Limited Liability Company" on all business cards, phone listings, advertisements, billheads, and letterheads.

Annual Requirements of LLCs

The next filing that is required for a Colorado LLC is the 1st of the same month that you set the company up. Companies formed in July must file their annual report by July 1st the following year. This is the sole state-required filing. Since LLCs have no personal or corporate income, you do not need to file an annual tax return.

Annual Meetings

LLCs are businesses. As such, members should be aware of the business's general activities and business plan. Since Managers or Members of LLCs transact all business, you may not have requirements related to approving daily affairs and decisions. Annual business meetings are still useful to receive member input and ensure everyone is aware of the investment and business plans. In most cases, LLC meetings will not be required by the LLC agreement.

Amending LLCs

You must periodically review your LLC to take care of changes to your LLC's situations or adjustments to the law. We suggest biannual or annual reviews of the business as well as estate planning. We strongly encourage amending legal documents with the assistance of a competent attorney.

Periodic Operation Reviews

We also suggest periodically meeting with advisors to review your LLC's operations. This is when you should thoroughly document your member meetings. The financial advisors will monitor the performance of assets.

Considerations for LLC Operations

Recently, the IRS successfully attacked LLCs and partnerships without proper operations. To prevent this from happening to your LLC, take the following into account:


  1. Transfer all assets of the senior generation to the LLC. This provides income that allows the member to maintain their lifestyle.
  2. Formally transfer titles to real securities or property that the LLC is intended to own, so the partnership owns them.
  3. The LLC must maintain separate records and accounting books.
  4. The LLC needs a bank account that is separate. The income generated by the LLC must be deposited into that account.
  5. Member distributions must be determined via pro-rata interests of the membership.

Formalities to Confirm Separate Legal Entities

Anytime a Member or Manager receives management fees, the LLC must do so via check originating in the LLC's account. This check must be deposited into the party's bank account. From there, it can write checks for the management fees. The distribution checks must be written out to members at the time of distribution. This serves as a paper trail preventing arguments that the LLC does not serve a business purpose.

Colorado law requires specific written records. These include:


  • Current lists
  • Tax return copies
  • Specific documents such as amendments, Certificate or Articles of LLC, LLC agreement, etc.
  • Written statements of specific scenarios

Conclusion

After you set up your LLC, ensure you operate it correctly. Conduct periodic reviews and follow all requirements to avoid legal or IRS troubles.

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