For All Colorado Businesses

Trade name Registration: Select the name under which you want to do business, e.g., “Colorado Business Associates,” “Southwest Ventures,” “Tina’s T-Shirts.” If you are going to use only your own proper name, without any reference to a company identify you do not have to file a Trade Name Registration.

Note: Banks will require the Trade Name Registration to document your authority to open a business checking account.

Sole Proprietorship or General Partnership: Register your trade name with the Department of Revenue. To find out if a name has already been registered, visit www.businesstax.state.co.us/ 

Corporate Registration: File Articles of Incorporation with the Secretary of State. If doing business under an assumed name (other than the name which you incorporate), file a Trade Name Affidavit with the Secretary of Sate.

Limited Liability Company / Limited Partnership: (including Limited Liability Partnership, Limited Liability Limited Partnership and Limited Partnership Association) File a Limited Partnership or Article of Organization for a Limited Liability Company with the Secretary of State’s Office, visit www.sos.state.co.us/  or call (303) 894-2200.

Legal Structure: For more information about selecting a legal form of business organization, call the SBDC at (970) 247-7009, the Colorado Small Business Hotline at 1-800-333-7798, or the Internal Revenue Service at 1-800-829-1040.

Business Licenses: A business license is required to conduct business in many cities, including the cities of Cortez and Durango. Call the City of Durango at 375-5000 or the City of Cortez at 565-3402 for licensing requirements. If you are unsure whether a license is required, and you live within the corporate limits of a city or town, call the City Clerk or Town Clerk office. If you live outside the corporate limits of a city or town, you probably will not need a local business license. There are some exceptions, as in the case of business, which provide lodging, and you should be aware of which exceptions might apply to you. Other occupations require special licenses with the State of Colorado.

For information about special occupation business licenses, contact the Small Business Hotline at 1-800-333-7798.

Sales Tax Licenses: Authorizes you to collect sales tax in retail transactions and is essential for retail businesses. Taxpayer Service Center 222 S 6th Street, Grand Junction, CO 81501; (970) 248-7140 or http://www.taxcolorado.com/ .

The State of Colorado: Tax rate is 3 percent. A $50 deposit is required with each new sales tax license application, which can cost from $4 to $16. The deposit is returned to you after you have collected and paid to the State of Colorado at least $50 in sales tax. There are also sales tax rates for most towns and some counties, and for lodging businesses.

IRS Tax Center: This section contains useful information and links to IRS.gov to assist small business owners and the self-employed with various IRS issues.

Businesses with Employees

Employers are required by federal and state laws to open and maintain a number of accounts for their employees. These accounts are where you deposit federal and state income tax withholding payments from payroll, and where you deposit your FICA matching and Medicare payments for employees. Contact the Colorado Small Business for specific forms and to request their Colorado Business Start Up Kit http://www.sba.gov/co/  or 1-888-333-7798.

Federal Employer Identification Number: IRS Form SS-4 establishes your FEIN for deposit of Social Security, federal withholding and federal unemployment taxes at your bank.

State Employer Registration: Form CR 100 is required for establishing withholding payment accounts for employee income tax withholding. The same form is forwarded by the Department of Revenue to the Colorado Department of Labor and Employment, which then establishes the state unemployment insurance accounts. This registration also establishes legitimacy to qualify for buying at wholesale process for resale and for additional discount programs available from businesses, which sell to business customers. For a copy of the CR 100 form visit http://www.coworkforce.com/UIT/EmployersHandbook/Forms.htm 

Unemployment Insurance: This fund, established by law, provides benefits to employees who lose their jobs through no fault of their own. The employer pays all federal and state unemployment insurance taxes. For more information, contact the Department of labor and Employment, Division of Employment and Training. For more information about the appeals procedure call the Unemployment Insurance Appeals Branch at (303) 318-9299 or 1-800-405-2338 (Toll Free).

Workers’ Compensation Insurance: A Workers’ Comp account is required for employers and may be purchases through your private carrier or the Colorado Compensation Insurance Authority: 720 S. Colorado Blvd., Suite 100N, Denver, CO 80222 Phone: 303-782-4082 Fax: 303-782-4031 Web Site: www.colocomp.com 

Contract Labor: Form 1099 is required for each worker hired on an independent contract basis to which you paid over $600 during the year. For help in classifying a worker as and employee or a contract worker, contact the Colorado Department of Labor and Employment or call the Small Business Hotline. Employers must meet many guidelines and pay for Workers’ Compensation and Unemployment Compensation insurance premiums and state and federal unemployment taxes. The costs can be high in some industries. Some business owners try to avoid paying the proper taxes; fees and premiums by call their employees “independent contractors.” Someone who works for you on your schedule, on your premises, with your equipment, gets paid weekly or monthly, receives training and benefits, takes paid vacation and receives direction from you is an employee. Someone who accepts and assignment, a deadline for completion and a fee agreement, but completes the work on his/her own schedule and with his/her own equipment, is an independent contractor. The difference is the level of control the business owner/manager has over the worker. The penalties for improperly recognizing employees and for not paying the appropriate taxes are severe.

Wage and Hour Laws: Nearly all manufacturers, wholesalers and contractors and many retail and service businesses are subject to Federal minimum wage, overtime and child labor requirements. The state of Colorado has established minimum wage requirements for retail stores, laundries, beauty parlors, motels, restaurants, and similar businesses. Information can be obtained from the Colorado Department of Labor and Employment.

Occupational Safety and Health Administration (OSHA): The safety and health of employees is protected by federal regulations. Employers should contact OSHA for publications. Specify the type of business in order to receive the appropriate publications for your business.

Miscellaneous

Zoning: Check with the city or county zoning department to determine if your business use is approved for your chosen location. If the location has always been a retail store or is in a shopping center, it is probably approved for retail and most service businesses. Industrial, manufacturing, auto repair, childcare, liquor sales, restaurants, and other types of business must meet certain requirements.

Major Remodeling: Major remodeling projects, such as additions of space, alteration of entryways, moving walls, changing electrical conduit or plumbing, and complying with ADA (Americans with Disabilities Act) requirements require Planning Department and /or Building Department approval. Get help from those departments and coordinate your planning efforts with your remodeling or construction contractor.

Property Taxes: Property taxes must be paid on business and real property. Check with your county property tax administrator for details.

Income Tax: Income tax must be paid to the Internal Revenue Service. Call the Tax Information line at (303) 825-7041 or 1-800-829-1040. The IRS hold free workshops on a regular basis in Southwest Colorado – watch for announcements in the local newspapers. Also, the State of Colorado requires the payment of state business taxes through the filing or estimated taxes throughout the year. Contact the Colorado Department of Revenue for information.

Financing: Banks are in the business of lending money to people and businesses that have a proven track record of ability to repay debts. Many small businesses do not have a track record because they have not been established long enough. Banks may lend to new businesses based on the good credit of the small business owner, the availability of personal and business assets as collateral and the existence of outside sources of repayment (such as income from regular employment of the owner or spouse). Some owners may qualify for Small Business Administration (SBA) loan guarantees, which are available through bans. Other programs for small business financing may be appropriate for you. Contact a Small Business Development Center (SBDC) counselor for further information.

Insurance: Discuss your insurance need with an insurance provider. Ask about business liability, liquor liability, income loss protection, workers’ compensation, asset coverage and other types of coverage, depending on your type of business.

Accounting and Legal: Consult with an accountant and an attorney for their advice on special issues that may affect smooth operation of your business. An attorney can initially assist you in incorporation, lawsuit, contract and lease matters. Your accountant or bookkeeper can help you with reporting business income and expenses to the IRS and the Colorado Department or Revenue.

Sources of Business Information