Form a Colorado LLC
Let LegalZoom walk you through the process of becoming a limited liability company today. With our help, creating an LLC is clear, simple, and can be done online in three easy steps. Protect your personal assets, organize your business however you want, and get the fringe benefits of a legally established business entity.
When you form your Colorado LLC with LegalZoom, we prepare and file your articles of organization with the Colorado Secretary of State. We also conduct a name search for your Colorado LLC to assist you in the preparation of your operating agreement and other customized services corresponding to your needs. Once your articles of organization have been successfully filed, your Colorado LLC begins its existence as a legal business entity.
LegalZoom LLC Overview
Registering an LLC Name: Choosing a business name is one of the first steps in the process of forming your Colorado Limited Liability Company. The name that you choose:
Must contain, as the last words of the name, the words "Limited Liability Company" or the abbreviations "L.L.C." or "LLC". The word "Limited" may be abbreviated as "Ltd." and the word "Company" may be abbreviated as "Co."
Should not be the same as another Colorado Limited Liability Company or other registered entity.
LegalZoom allows you to choose up to 3 names for your Colorado Limited Liability Company, in order of preference. We will conduct a name check before filing to see which names are available.
How to Register: Once you have chosen an available name, LegalZoom can help you register your name with the state.
Articles of Organization: In any Colorado LLC formation, the articles of organization must be filed with the Secretary of State. State law requires that certain information be included in your articles of organization of your Colorado LLC formation. This information must include:
The company name
Its principal place of business
The name and business address of the registered agent for service of process
A statement as to whether the LLC is to be manager-managed, and if so, if management is vested in managers, the names and business addresses of the initial manager or managers
If the LLC is member-managed, the names and business addresses of the initial member or members
With respect to a LLC, if management is in managers rather than reserved to the members, the names and addresses of the initial member or members may be set forth in the articles of organization
Filing: Your LLC is considered organized once the articles of organization are delivered to the Colorado Secretary of State, and the articles are deemed to be compliance with state requirements. One certified copy of the articles of organization will be issued, and the other certified copy will be returned to the organizer or members.
Additionally, a Colorado LLC formation generally requires inclusion and/or consideration of the following:
Organizers: Any person at least 18 years of age or entity may form a LLC. They need not be members of the LLC.
Minimum Number of Organizers: One or more natural persons or entities.
Eligibility:An organizer may be an individual, corporation, government or governmental subdivision or agency, business trust, estate, trust, limited liability company, partnership, association, or other legal entity.
Operating Agreement: Although not required, LLC members may adopt an operating agreement for the company, which may also be amended and repealed as allowed by the agreement or applicable law. The articles of organization may contain restrictions or prohibitions on the power of the members to adopt, amend, or repeal an operating agreement. If there is more than one member, any operating agreement shall initially be agreed to, in writing, by all of the members.
Membership: A limited liability company must have one or more members. Requirements:
Minimum Number of Members: One or more
Eligibility Requirements: A natural person or an entity
Procedure for Membership: The member may acquire an interest in the LLC directly from the limited liability company at formation and, after formation, upon the written consent of all members.
Resignation of Membership: Certain prohibitions exist surrounding the ability of a member to resign from the company.
Unless prohibited in a written operating agreement, a member may resign from a LLC by giving written notice to the other members
If the resignation violates the operating agreement, the LLC may recover any damages resulting from the breach of the operating agreement and offset the damages against the amount otherwise distributable.
Contribution:The contributions of a member to the limited liability company may be cash, property, or services rendered or a promissory note or other obligation to contribute cash or property or to perform services.
Registered Agent In Colorado
LegalZoom can also provide your business with registered agent services. Every Colorado LLC must have a registered agent. A registered agent is the person or business responsible for accepting service of process for an entity. They also accept mailings from the Secretary of State, such as the annual report. Such person should then forward the documents to the entity.
Eligibility Requirements: Any individual at least 18 years of age with a physical address in Colorado may act as a registered agent in Colorado. Also, any business entity having a usual place of business in Colorado (a physical Colorado street address) may act as a registered agent in Colorado. As of July 1, 2004, an entity can serve as its own agent. You may NOT appoint the Secretary of State as a registered agent for service of process. You may only appoint one individual or business entity as agent.
Registered Office: The registered office may be a place of its business.
Colorado Secretary of State
Once a Colorado LLC has been created, the Colorado Secretary of State will require that certain recurring responsibilities and duties be met. The most important of these are explained below. For further information, refer to the Colorado Secretary of State office.
Annual Report: Each limited liability company shall file an annual report with the Colorado Secretary of State regarding:
The registered agent name and registered agent address of the reporting entity's registered agent;
The principal office address of the reporting entity's principal office.
On and after January 1, 2002, the form for the first annual report shall be delivered by the secretary of state to the reporting entity, at its registered agent address, in the calendar year following the year in which the reporting entity was formed. Thereafter, the annual report form shall be delivered to each reporting entity annually.
Records:Each limited liability company shall keep following records open to inspection at its office:
A current list of the full name and last-known business, residence, or mailing address of each member and manager, both past and present
A copy of the articles of organization and all amendments thereto, together with executed copies of any powers of attorney pursuant to which any amendment has been executed
Copies of the limited liability company's federal, state, and local income tax returns and reports, if any, for the three most recent years
Copies of any currently effective written operating agreements, copies of any writings permitted or required, and copies of any financial statements of the limited liability company for the three most recent years;
Minutes of every annual and special meeting and any meeting
Unless contained in a written operating agreement or in a writing permitted or required, a statement prepared and certified as accurate by a manager of the limited liability company which describes:
o The amount of cash and a description and statement of the agreed value of the other property or services contributed or agreed to be contributed in the future by each member
o The times at which or events on the happening of which any additional contributions agreed to be made by each member are to be made
o If agreed upon, the time at which or the events on the happening of which a member may terminate his membership in the limited liability company and the amount of, or the method of determining, the distribution to which he may be entitled respecting his membership interest and the terms and conditions of the termination and distribution;
o Any right of a member to receive distributions which include a return of all or any part of a member's contribution;
Any written consents obtained from members
Acts Triggering Dissolution: Unless otherwise provided in the articles or a written operating agreement, a limited liability company is dissolved upon the happening of any one of the following events:
By the unanimous written agreement of all members
At the time or upon the occurrence of events stated in writing in an operating agreement
By entry a court order
An LLC can offer certain tax advantages over a corporation, including the availability of more deductions. Additionally, an LLC is not required to be a separate tax entity like a corporation;instead, it can be a "pass-through entity," so that the LLC owners report business losses or profits on their personal tax returns, like a partnership.
Federal Income Tax: Unless you elect to tax the limited liability company as a corporation, the IRS treats single-member LLCs as sole proprietorships for tax purposes. This means the LLC itself does not pay taxes and does not have to file a tax return. Unless you elect to tax the limited Liability company as a corporation, the IRS treats multi-owned LLCs as partnerships for tax purposes. This means that LLC owners each pay taxes on their lawful share of the profits on their personal income tax returns, not the LLC itself. If you desire, by filing IRS Form 8832, you may elect corporate taxation if you regularly need to keep a substantial amount of profits in your LLC.
Federal Tax Identification Number: Your LLC may need to obtain a federal tax identification number (also known as an employment identification number/ EIN), which is similar to an individual's social security number. Generally, you will not need a separate EIN number for your LLC as long as you are the sole owner and the LLC has no employees. However, if you are not the sole owner of the LLC or if the LLC has employees, your LLC will need a separate EIN number to open a bank account and for certain tax filing requirements LegalZoom can prepare your Federal Tax ID Application if you have not already done so.
Filings must be made with the Colorado Secretary of State, along with the appropriate state filing fee. When appropriate, one check must accompany the document, payable to the Colorado Secretary of State, covering all charges for the Secretary of State.