Colorado
Taxes and business formation • USA 2025–2026
TL;DR
Colorado at a glance — 2026 figures
State filing fees and tax position for individuals and companies registered in Colorado.
| Parameter | Value |
|---|---|
| Personal income tax | See the income tax section below |
| LLC formation fee | $50.00 |
| LLC annual report fee | $25.00 |
| LLC annual report deadline | A 5-month window: the 2 months before the anniversary month, the anniversary month itself, and the 2 months after |
| LLC dissolution fee | $10.00 |
| Corporation formation fee | $50.00 |
| Corporation annual report fee | $25.00 |
State filing fees are set by the Secretary of State and change without notice — the official source is linked in each section below. Federal figures for tax year 2026 are on the 2026 tax cheat sheet.
Updated: August 2026
LLC in Colorado
Corporation in Colorado
Tax system of Colorado
Income Tax
Colorado applies a flat personal income tax rate of 4.4% (for 2025) to all taxpayers. The tax is levied on wages, business income, rental income, capital gains, interest, and dividends. The state also recognizes most federal deductions and offers its own tax credits for families with children, retirees, and charitable contributions.
Sales Tax
The base statewide sales tax rate is 2.9%, but Colorado is one of the most decentralized states when it comes to this tax. Cities and counties can set their own rates, which are often quite high, bringing the combined rate to 8.5–11% in some localities. In addition, there is a distinction between state-collected and home-rule jurisdictions, where administration of the tax is handled differently, which significantly complicates calculation and reporting.
Property Tax
Colorado has a relatively low property tax — the average effective rate is about 0.55% of market value, below the national average. However, rates vary depending on the county, school district, and special districts.
Business Taxes
C-corporations are subject to corporate income tax at a rate of 4.4% — the same as the individual rate. Colorado does not levy a Franchise Tax, which is a favorable contrast to states such as Delaware, Texas, or California. An Annual Report is mandatory for all registered legal entities — LLCs, corporations, and nonprofit organizations. Businesses are also required to report tangible personal property when its value exceeds the established limit. Our firm provides services for LLC and corporation registration in Colorado, preparation and filing of the Annual Report, and calculation and filing of business taxes.
Excise Taxes
Colorado levies excise taxes on alcohol, tobacco, fuel, vehicles, and marijuana (both medical and recreational). Additional environmental fees and a plastic tax are collected in a number of municipalities.
Favorable Tax Conditions
• A flat personal income tax rate of 4.4% for all taxpayers (individuals and entities); • No Franchise Tax; • One of the lowest property tax rates in the U.S.; • A simplified Annual Report filing process with low state fees; • Tax credits and support programs for startups, green projects, and R&D.
Compared to Other States
Colorado's 4.4% personal income tax is lower than in several other flat-rate states (for example, Idaho — 5.8%, Georgia — 5.39%, Illinois — 4.95%), but higher than in states with no income tax at all (such as Florida, Texas, or Washington). The sales tax is complicated by the home-rule city system, which requires precise accounting and professional support. The corporate tax is one of the simplest and most uniform. There is no estate tax, unlike in many East Coast states.
Frequently asked questions
Does Colorado have a personal income tax?+
Yes. Colorado levies a personal income tax on residents. The current rates and brackets are set out in the income tax section on this page, with a link to the state tax authority — rates are revised by the legislature, so always check the official source before filing.
How much does it cost to register an LLC in Colorado?+
The state filing fee in Colorado is $50.00. On top of that you need a registered agent with a physical address in the state, and FinTaxes charges from $299 for the formation service itself.
When is the annual report due for a Colorado LLC?+
The Colorado annual report fee is $25.00, due A 5-month window: the 2 months before the anniversary month, the anniversary month itself, and the 2 months after. Missing it typically triggers a late penalty and, if left unresolved, administrative dissolution of the company.
Do I need to live in Colorado to open an LLC there?+
No. You do not need to live in Colorado — or in the United States at all — to own an LLC registered there. Non-residents can form and own a US LLC; what the state requires is a registered agent with a physical in-state address. Your own tax residency is a separate question and decides which returns you file.
Can FinTaxes file my Colorado state return remotely?+
Yes. FinTaxes prepares and e-files federal and Colorado state returns entirely remotely, for clients anywhere in the US or abroad, as an Authorized IRS e-file Provider.
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