LLC Annual Report and Tax Filing Requirements in Colorado

Forming a limited liability company (LLC) is a great option for many small business owners. As with other businesses, you need to keep your LLC in good standing with the state. To remain in good standing, you'll need to file the required ongoing paperwork with the state, pay all taxes, and file your business tax returns.

In this article, we'll review the tax and filing requirements for your Colorado LLC. If you need legal advice, consider speaking with a business lawyer in Colorado. An attorney can help you fulfill your tax and filing obligations and advise you on other aspects of running your business.

If you need more information about other states' requirements, read our article on LLC tax and filing requirements.

Colorado LLC Annual (Periodic) Report

Like most states, Colorado requires you to file an annual report for your LLC with the Colorado Secretary of State (SOS). Colorado calls this filing a "periodic report." The SOS uses the report to keep an up-to-date record of all businesses. You'll use the report to update or confirm your principal office address and registered agent information.

The report is due during the three-month period beginning with the first day of the anniversary month of your LLC's formation. For example, suppose you formed your LLC on June 15. The report would be due each subsequent year between June 1 and August 31. You can also file the report up to two months early.

You can file the report online through the SOS website. As of 2023, the filing fee is $10. There's also a $50 penalty for reports filed late.

For more information, read the SOS's business FAQ page.

State Business Taxes in Colorado

By default, Colorado treats LLCs as pass-through tax entities. An LLC will be taxed as a partnership if there's more than one member or a sole proprietorship if it's a single-member LLC. As the name "pass-through tax entity" suggests, the business income will pass through the LLC to the owners, and each owner will report and pay taxes on their share of the income.

No Colorado franchise tax. Some states impose a separate tax or fee on LLCs for the privilege of doing business in the state. Colorado, though, isn't one of those states

Electing corporate tax status. An LLC can elect to be taxed as a corporation instead of as a partnership or sole proprietorship. You must submit a form to the IRS to elect corporate tax status. Colorado, like almost every other state, taxes corporation income. As of 2023, in Colorado, the corporation income tax is a flat 4.4% of taxable income. You can file your taxes online with the Colorado Department of Revenue (DOR).

Colorado Employer Taxes

If your Colorado LLC has employees, you'll need to pay employer taxes. You'll pay Social Security and Medicare taxes to the federal government. In addition to federal taxes, you'll pay employer taxes to Colorado.

Withholding employee wages. You must register with the DOR to withhold and pay employee income taxes. Once you've registered, you'll need to file withholding taxes on a periodic basis—either weekly, quarterly, or monthly—based on your annual wage withholding liability. You must prepare a W-2 for each employee and provide a copy to the employee and DOR each year. You'll also need to use Form DR 1093 (for W-2s) and/or Form DR 1106 (for 1099s) each year to reconcile your LLC's tax withholding. For more guidance, see Colorado's wage withholding tax guide.

Unemployment insurance (UI) tax. In addition, you'll probably need to register to pay state UI taxes. The Colorado Department of Labor and Employment (CDLE) handles this tax. You should register with the CDLE through MyUI Employer. Then, each quarter, you'll pay premiums by filing quarterly premium and wage reports. You can find out your UI liability and questions to frequently asked questions on the CDLE website.

Colorado Sales and Use Tax

If you plan to sell taxable goods or services to customers in Colorado, you'll need to collect and pay sales tax. If you haven't already, you'll set up a tax account with the DOR by filing Form CR 0100. The DOR will then send you a Letter ID for your sales tax account that'll act as your sales tax license. You can also apply for a sales tax license through Colorado's Sales and Use Tax System (SUTS).

Once you have your license, you'll submit sales tax returns to the DOR on a periodic basis—either monthly, quarterly, or annually. The frequency of filing depends on your tax liability. You can pay and report sales tax online using SUTS.

In addition to state sales and use tax, you might be responsible for reporting and paying sales and use tax to your city or county. Make sure you check with your local taxing authorities for your reporting responsibilities.

LLC Registration in Other States

If you plan to do business in states other than Colorado, you could need to register your LLC in those states. You should check each state's foreign (out-of-state) registration requirements. To find out registration requirements for other states, see our state guide to qualifying to do business outside your state.