All Corporations, Limited Liability Companies (LLCs), Non-Profit Corporations, and foreign entities registered to conduct business in the State of Colorado must file a periodic report each year with the Colorado Secretary of State’s Business Division.
The intent of the report, which in some states is called an annual report, is to make sure the state and members of the public have the most up-to-date information about every reporting company that conducts business in Colorado.
Filing the report is not difficult, but you must pay close attention to guidelines, as not doing so could result in loss of good standing and perhaps even legal consequences for your business.
In this article, we’ll have a look at when and how to file the report, how much it costs, and consequences of not filing. But first, let’s delve a little deeper into which companies are required to file a Colorado periodic report.
What is a Reporting Entity?
All reporting entities in the State of Colorado are required to file a periodic report. A reporting entity, as listed on the Secretary of State’s website, is any of these types of businesses:
- Business Development Corporation
- Cooperative Housing Corporation
- Cooperative
- Corporation
- Limited Liability Company
- Limited Partnership (formed after July 26, 2009)
- Limited Partnership Association
- Nonprofit Corporation
- Limited Liability Partnership
- Limited Liability Limited Partnership
- A corporate entity referred to in section 7-137-102 of the Colorado Revised Statutes
If you have a company that’s registered with the state as any of these types of business entities, you’ll need to file a periodic report. Anyone with authority within the organization, such as an owner, member, or officer, is qualified to submit the report.
Both domestic and foreign companies must file. A domestic company, as you probably know, is one that conducts business in the state in which it was formed. A foreign company is one that conducts business in a state other than where it was formed. So, if you formed your company in Nebraska and later expanded business operations into Colorado, the company would be considered a domestic entity in Nebraska and a foreign entity in Colorado.
When Should the Report be Filed?
Your periodic report is due annually on the last day of the anniversary month in which your business was formed, so when you file depends on your company’s anniversary date. However, Colorado allows the report to be filed as early as two months prior to your anniversary month or two months after, without penalty.
If you formed your company on May 15, for instance, you could file the report any time between March 1 and July 31, giving you a five-month window to complete the task.
In addition to the grace period given for filing the report, Colorado is generous with its reminders for submitting the form. If you sign up for the Secretary of State’s email notification service, you’ll get a reminder email about the periodic report the month before your anniversary month. You also can receive reminders for other deadlines and renewal due dates by signing up for the email notification service.
If you don’t file the periodic report on time, you’ll be notified by the state when your deadline has passed. Regardless of whether you opt to receive reminders, however, you are responsible for making sure the report is submitted on time.
File Your Periodic Report
CorpNet’s team of compliance experts is available to help you file your Colorado periodic report.Â
How to File a Periodic Report
To complete and file the periodic report, you’ll need to determine when the report is due, using the information above. You can find your business entity’s reporting month on the Summary page on the Secretary of State’s website.
You can access the form you need to fill out on the Summary page of the website, as well, and make any necessary changes, such as an address change for the company or if you’ve gotten a different registered agent.
Be aware that everything submitted on the form will be made a matter of public record and available for scrutiny on the Secretary of State’s website by anyone interested, so avoid including any person information, such as a Social Security number or phone number.
Once you’re completed the form, take time to review it carefully, as you could incur a penalty or other legal consequences for submitting incorrect information. When you’re confident it’s ready to submit, the system will take you to the first of three payment pages and you can use a credit or debit card to pay the $25 filing fee.
Consequences of Not Filing
If you don’t file a periodic report by your due date, you’ll be charged a $50 late fee in addition to the $25 cost for filing. More importantly, your company will be put on non-compliant status the day after the report was due, meaning that you’re no longer in good standing with the state.
Loss of good standing can affect your company’s ability to apply for loans or renew business licenses, and it signals to customers and vendors that the company may be in trouble.
If you don’t submit the form for 90 days after its due date, your company will be considered delinquent and the late fee increased to $100. And if no effort is made regarding the periodic report after that, the Secretary of State could initiate a process leading to the dissolution of the business.
A business that’s been dissolved by the state loses its legal shield, meaning your personal assets could be at risk. Colorado provides an avenue for reinstatement of businesses that have been dissolved by the state, but there are fees involved, along with loss of reputation and standing among customers, vendors, lenders, and others.
Putting it All Together
When you’re involved with the hectic, day-to-day routine of running a business, filing reports, updating applications, and completing other tasks necessary to remain in compliance with the state can be daunting.
Not remaining in compliance, however, has serious consequences, such as those described in the previous section. If you don’t have an administrative person within your company to perform the tasks related to compliance and you’re not confident that you’ll complete them correctly and on time, it’s a good idea to consult a trusted professional or a qualified third-party such as CorpNet to help.
Removing the responsibility for compliance issues can free you up to run and grow your business, the reason you started it in the first place.
