Form Your Colorado S Corporation

An S corporation is an IRS tax election, not a separate state entity. You first incorporate by filing Articles of Incorporation with the Colorado Secretary of State for a $50 fee, then file IRS Form 2553 to elect S-corp status.

The Colorado state filing fee to incorporate is $50, and the IRS charges nothing to file Form 2553 for the S-corp election. Ongoing, the periodic (annual) report is just $25, and Colorado has no franchise tax.

Colorado filings are submitted online and approved immediately in real time, so there is no separate processing wait or paid expedite tier. After incorporating you still file IRS Form 2553 to complete the S-corp election.

File IRS Form 2553 within 75 days of incorporating, or generally by March 15 to have the election apply to the current tax year. All shareholders must consent on the form.

An S corp may have no more than 100 shareholders, all of whom must be US citizens or residents, and only one class of stock. Foreign (non-resident) owners are not eligible, so businesses with foreign shareholders cannot elect S-corp status.

Profits pass through to owners and are taxed once on their personal returns, avoiding C-corp double taxation. Owners pay themselves a reasonable W-2 salary subject to payroll taxes, and remaining profits taken as distributions are not subject to self-employment tax. Colorado's flat 4.4% corporate income tax still applies.

No. Colorado does not impose a franchise tax. Corporations pay a flat 4.4% state corporate income tax, and the state sales tax rate is 2.9%.

No. Under FinCEN's March 2025 interim final rule, US domestic entities and US persons are exempt from Beneficial Ownership Information reporting. Only foreign-formed entities registered to do business in a US state must still file.