Starting a Business in Colorado
Colorado is a wonderful place to put down roots for a startup company as well as for companies who would like to relocate to Colorado. The Centennial State has been going through an economic boom, largely due to the rapid expansions in the Tech, Natural food, and Cannabis industries. With a reasonable tax burden and a fair and balanced regulatory environment, it is no wonder many entrepreneurs keep flocking to Colorado.
STEPS TO STARTING A BUSINESS IN COLORADOFinding the right balance of due diligence and decisive action is important when starting a business in Colorado. Before opening a business bank account or trying to establish business credit, you will want to apply for a FEIN number. Additionally, you can search for the relevant Colorado business licenses for your company to meet compliance requirements. After which, you can complete your Colorado business registration, but before trying to collect Colorado sales tax you must first check the status of form CR 0100A. You will have to look up your appropriate Colorado sales tax rate before you file. Finally, look at the various available programs offered to businesses in Colorado. There are tax credits, cash incentives, business grants and loans that are offered based on business type, industry, and location. The Colorado Department of Revenue regulates taxes and the procedures related to collecting them while rules governing business formations fall to the office of the Colorado Secretary of State. After performing a corporation search, and once you have a fully structured company with the Colorado Secretary of State, you can register online for a Colorado Sales Tax License. Additionally, you may have to apply for business credit cards, in which case you can get a Tax ID Number. If you lease commercial office space or are in an industry that is regulated, you will have to obtain Business Licenses you need to stay compliant. After completing legal requirements for your business you can focus on the financing and cash flow programs offered. Below are some of the opportunity programs available to help you grow your business in Colorado.
- The Advanced Industry Accelerator Program is a funding initiative for companies on the cutting edge of technology. It is made up of different grants at different levels of business.
- The Proof of Concept Grant is targeted at research institutions in order to take them to the private sector where their concepts and research can turn into tangible products.
- The Early Stage Capital and Retention Grant directs funding towards start-ups who can take the technology concepts from the proof of concept stage and manufacture them in Colorado into products that can be exported.
- The Colorado Export Accelerator program provides financial assistance to qualified Colorado exporters.
- The Colorado Film Initiative offers filmmakers the opportunity to secure a 20% cash rebate on all qualified production costs. This applies to television series and commercials, feature films, music videos and video game development. In lieu of the cash rebate incentive there is also a bonded loan program for film production companies that qualify.
- The Colorado Enterprise Zone Program provides state income tax credits to attract businesses to relocate to economically distressed or underdeveloped areas. The goal is to bring monetary capital and human capital to these impoverished areas.
- There are a few notable programs geared toward companies looking to relocate to Colorado. The Colorado First Job Training Program offers funding to new hires. The Job Growth Incentive Tax Credit supports businesses that specifically foster programs that create jobs. The Strategic Fund Incentive Program supports qualified businesses that are able to create a positive number of net new jobs in a one year time frame.
- The Colorado Sales Tax Exemption program offers qualified manufacturing businesses an exemption on machinery or equipment used in the manufacturing process. All of the equipment, (including tools used in the manufacturing process) as well as parts and components are also exempt from Sales and Use Tax. A seller’s permit will be necessary for any manufacturing company wishing to apply for the exemption.