Starting a business in Colorado Springs, Colorado: a practical checklist
Updated
Requirements, fees and rules change, and some of them depend on exactly what you sell and where you work. Treat this as a map, and confirm each step with the linked office before you act. This is general information, not legal or tax advice.
The big local difference: the city runs its own sales tax
In many Colorado cities the state collects everything. Colorado Springs is different. The city's sales tax page says it is a home rule city and collects its own sales and use tax. The city's business navigator FAQ says that if you sell goods or perform taxable services in Colorado Springs, you need a city sales tax license, and that you apply online through the city's portal at no cost.
The sales tax page also says returns and payments are done online through the city's portal, with paper returns no longer accepted. That means you will likely have two tax accounts: one with the state and one with the city. The page lists current rates, and the city's sales tax office can answer questions at 719-385-5903 or [email protected].
Step by step
- Form the business with the state. An LLC is formed by filing Articles of Organization with the Colorado Secretary of State. The fee schedule (revised July 1, 2024) lists $50 online for Articles of Organization and $25 online for the annual Periodic Report. The schedule is subject to change, so check it before you file.
- Get a state sales tax license if you sell taxable items. The Department of Revenue explains how to apply, including through MyBizColorado.
- Get the city sales tax license described above, using the portal linked from the city sales tax page.
- Check whether your trade needs a city license. See the next section.
- If you work from home, check the home occupation rules. See below.
No general business license, but some trades need one
The city states that it does not have a general business license. According to the City Clerk's business licensing page, only certain business types need one, including concrete contractors, excavation, tree services, massage businesses, mobile food vendors, pawnbrokers, security services and bicycle-share businesses. The page says most of these licenses are $110 annually, and you can apply online or in person at the City Clerk's Office, 30 South Nevada Avenue, Suite 101 (719-385-5901, option 1). Liquor, beer and marijuana licensing are handled separately, so check with the city if that is your business.
Working from home: the Home Occupation Permit
The city's navigator FAQ says most home-based businesses need a Home Occupation Permit. The permit page lists a non-refundable $120 application fee, with no renewal unless you move. Limits it describes include:
- The space used cannot exceed half of the first floor area of the home.
- No outside workers unless they live in the home.
- Signs of 2 square feet or less, attached to the house and not lit.
- Client visits spaced at least 15 minutes apart, one client vehicle at a time.
- Some uses are prohibited, such as vehicle repair and spray painting shops.
The page also warns to check your neighborhood covenants first, because they can prohibit a home business even when the city would allow it.
If you plan to rent a place short term
Colorado Springs has a specific short term rental permit. The city lists a $124.95 annual fee, proof of liability insurance, proof of a platform listing, and different rules for owner-occupied and non-owner-occupied units, including zoning limits. The permit is separate from the sales tax license, so read the page before you list anything.
Local help
- Pikes Peak SBDC. The Colorado Small Business Development Center serving the Pikes Peak Region offers consulting and low or no cost training. The center's own site says it is hosted by the Colorado Springs Chamber and EDC, with its main office at Catalyst Campus.
- Colorado Springs Chamber & EDC. It is both the local chamber and the economic development organization. Its site lists a small business resources section that includes COS Open For Biz, and an incentives and taxes section.
- The city itself. For anything this guide could not confirm, start at coloradosprings.gov.
Setting up a business email address
You have two reasonable routes. One is your own domain with Google Workspace or Microsoft 365. You own the domain, you can add staff, and it suits a brand with a website. It takes longer and costs a domain fee plus per-user fees.
The other is a short local address like [email protected] from us. A personal name is $19 a month, and trade names such as plumber@ cost more. There is no domain to buy and no DNS, and setup takes about five minutes. The tradeoff is that you rent the address and do not own the domain, so for a brand with staff your own domain is the better choice. See the cost guide for a closer comparison, or check a name on the home page.