Creating a Corporation in Colorado
Select a Business Name
Under Colorado law, your corporation’s name must consist of the words “incorporated,” “corporation,” “limited,” or “company,” or an short form of these words (“Creating a Corporation in Colorado”). The name might not specify or suggest that the corporation is arranged for an intention other than one allowed by state law or its articles of incorporation.
Your corporation’s name should be discernible from other business entities’ names previously filed with the Colorado Secretary of State. Names might be verified for accessibility by exploring the Colorado Secretary of State business name database. An available name might be kept for 120 days through filing a Statement of Reservation of Name with the Colorado Secretary of State. The form must be e-filed at the Secretary of State website with a $ 25 filing fee.
Articles of Incorporation
Your company is lawfully formed through filing Articles of Incorporation with the Colorado Secretary of State. They must consist of the following:
- Name and address
- Purpose, name, address of process service agent
- Name and address of each incorporator
- Number and classes of shares the company is permitted to distribute
The articles must be e-filed along with a $50 filing fee.
Assign an Agent Who is Registered
Each Colorado company should have a state process service agent. The person or company is the one that consents to receive legal documents on the corporation’s behalf if legal action is taken against it. A corporation might not act as its own agent for service of process. The agent must consent to receive service of process on your corporation’s behalf before designation.
The registered agent might be as follows:
- A person who is a permanent Colorado resident
- A Colorado business entity with its main location of business in Colorado, or
- A foreign entity sanctioned to conduct business in Colorado and which has a standard place of business in the state.
The agent should have a physical Colorado street address, not a post office box. Small corporations normally appoint a director or officer to act as the first agent. A different agent can always be appointed afterward.
Create a Corporate Records Book
Create a corporate records book in which all of your corporation’s vital papers are stored, including director and shareholder conferences minutes, stock certificates, and stock certificate stubs. The corporate records book should be store at your company’s main office. You can utilize a three-ring binder or send for a special corporate records kit through a corporate kit supplier.
Get Corporate Bylaws Ready
Bylaws are an domestic business document that you plan the fundamental basics for running your company and not filed with the state. Your company is not lawfully forced to have corporate bylaws, but you must accept them since they (1) institute your corporation’s working regulations, and (2) assist demonstrating to banks, creditors, the IRS, and others that your company is legal.
Assign Primary Company Directors
The incorporator is an individual who endorsed the articles. He or she should assign the primary company directors who will be board members until the initial yearly shareholders meeting, when the board members who will serve for the subsequent term are chosen by the shareholders. This person should endorse it and put a copy in the corporate records book.
Conduct Your Initial Board of Directors Conference
An initial meeting of the corporation’s board of directors must be conducted so that the directors could assign corporate officers, implement bylaws, choose a company bank, sanction distribution of stock shares, establish the corporation’s economic year, and assume an authorized stock certificate form and corporate seal. The directors’ actions should be written down in corporate minutes that the incorporator or a few directors arrange. If the company will be an S corporation, the directors must also grant the election of S corporation standing. It is typically required to get the minutes ready during one or two weeks and forward them for every director’s signature.
Distribute stock to every stockholder. Even though not lawfully necessary in many states, small companies typically distribute paper stock certificates. Record every shareholder’s name and contact information in the company’s stock transfer ledger. The stock share in your company is categorized as a security according to state and federal securities laws that control corporate stock’s proposal and sale.
File Regular Reports
Colorado and foreign corporation sanctioned to conduct business in the state must file a Periodic Report with the Colorado Secretary of State every year. The report must be submitted during the three-month interval starting with the first day of the corporation’s anniversary month of creation or eligibility to conduct business in Colorado. If you enroll for the Business Division’s e-mail notification service, an e-mail notice that a Periodic Report is due will be forwarded at the start of the three-month interval for filing the Periodic Report promptly. The report must be filed online at the Secretary of State’s website along with a $10 filing fee.
Obey Other Tax and Authoritarian Criteria
The following supplemental tax and authoritarian criteria are relevant to your company:
- EIN: Your company should acquire a federal employer identification number (EIN). You must acquire it by concluding a free, online application on the IRS website.
- S Corporation Filing: If the company wishes to choose S corporation standing for tax reasons, it must present Form 2553 Election by a Small Business Corporation, which every shareholder signs. The deadline to file the election is two months and fifteen days after the start of the corporation’s initial tax year.
- Business Licenses: Dependent on its kind of industry and its location, your corporation might need to acquire other local and state business licenses.
Foreign Corporation Conducting Business in Colorado
Every corporation arranged outside of Colorado must sign up with the Colorado Secretary of State to conduct business in Colorado. Foreign corporation must assign a registered process service agent actually situated in Colorado. To sign up, file a Statement of the Foreign Entity Authority. The statement must be filed online along with a $100 filing fee.
Prior to filing, make certain the corporation’s name is accessible in Colorado by exploring the Colorado Secretary of State’s business name database. If the name is unavailable, the foreign corporation must utilize an unspecified name to conduct business in Colorado.