Colorado vs Vermont LLC: fees, taxes, and which to pick
Data last updated: Apr 21, 2026Colorado charges $50 to form an LLC; Vermont charges $155. Day-one sticker price is only part of the story, since most of the real cost comes from the annual obligations that stack up each year you keep the LLC open.
Over a rolling three-year window, Colorado runs about $165 less in total state fees than Vermont. Whether that gap matters depends on whether you actually operate in one of these states or are weighing a non-resident filing.
On speed, Colorado typically clears standard online filings faster than Vermont. Both states offer expedited tiers at an additional cost for filers on tight timelines.
For most small operators the choice is not really between these two states at all. It is between forming where the business actually operates and trying to route through a non-resident filing. The data below shows what each option actually costs.
Key differences at a glance
- Colorado costs $105 less to form ($50 vs $155).
- Colorado is $20 per year cheaper to maintain ($125 vs $145).
Where each state fits
For most filers, forming in the state you actually operate from is the right call. The side-by-side below shows where the two states meaningfully diverge.
Three-year cost, side by side
Rough estimate of the state-facing cost to form and keep an LLC through three years. Both totals include a $100 per year registered-agent estimate.
Running total includes the one-time filing fee and annual ongoing costs (report fee or franchise tax plus a $100/year registered agent estimate).
What it costs under your specific situation
The table below runs the same LLC through four common scenarios. "Non-resident" rows assume a typical home-state foreign LLC registration adds about $200 per year of stacked cost; the real number depends on which state you live in and ranges from $50 to over $800 depending on jurisdiction.
| Scenario | Year 1 | Each year after | 3-year total |
|---|---|---|---|
| You live in Colorado, business operates there No foreign LLC registration needed. You pay Colorado fees only. | $175 | $125 | $425 |
| You live in Vermont, business operates there No foreign LLC registration needed. You pay Vermont fees only. | $300 | $145 | $590 |
| Non-resident forming in Colorado with operations elsewhere You pay Colorado's fees plus a typical home-state foreign LLC registration of about $200 per year. | $375 | $325 | $1,025 |
| Non-resident forming in Vermont with operations elsewhere You pay Vermont's fees plus a typical home-state foreign LLC registration of about $200 per year. | $500 | $345 | $1,190 |
Colorado vs Vermont: full comparison
| Dimension | Colorado | Vermont |
|---|---|---|
| Online filing Can you file the formation document online? | Yes | Yes |
| Online approval time Standard, non-expedited | 1 business day | 3 business days |
| Expedited option Neither state offers paid expedite | Not offered | Not offered |
| Annual report Required in addition to tax | Required, $25 | Required, $45 |
| State-imposed annual tax Franchise, privilege, or LLC tax minimum | None | None |
| State income tax On pass-through LLC income at member level | Yes | Yes |
| Publication requirement Newspaper publication after formation | No | No |
| Operating agreement Required by state statute | Recommended, not required | Recommended, not required |
| Foreign LLC fee Cost to register as a foreign LLC in this state | $100 | $155 |
| State sales tax General statewide rate | 2.9% | 6.0% |
Taxes in Colorado and Vermont
How each state handles entity-level tax on LLCs. Pass-through classification means member-level income tax also applies at each member's residence state.
Colorado tax
No entity-level franchise tax on LLCs. State income tax applies to member-level pass-through income. Corporate rate 4.4%.
Vermont tax
No entity-level franchise tax on LLCs. State income tax applies to member-level pass-through income. Corporate rate 8.5%.
Ongoing compliance
The recurring filings each state requires after formation.
Colorado
Annual report $25, due on your anniversary month. Registered agent required in Colorado.
Vermont
Annual report $45, due on your anniversary month. Registered agent required in Vermont.
Formation process, side by side
What actually happens from the moment you start filing to the moment you're in good standing. Use this as a checklist.
Colorado
- Check business-name availability on the Colorado entity search.
- Appoint a registered agent with a physical Colorado street address.
- File Articles of Organization for a Limited Liability Company for $50.
- Wait for approval. Online typically 1 business days. No paid expedite offered.
- Adopt an operating agreement (recommended, not required by Colorado statute).
- Apply for a federal EIN (free from the IRS).
- Open a business bank account to separate personal and business finances.
- File your first annual report and pay $25 when it comes due.
Vermont
- Check business-name availability on the Vermont entity search.
- Appoint a registered agent with a physical Vermont street address.
- File Articles of Organization for $155.
- Wait for approval. Online typically 3 business days. No paid expedite offered.
- Adopt an operating agreement (recommended, not required by Vermont statute).
- Apply for a federal EIN (free from the IRS).
- Open a business bank account to separate personal and business finances.
- File your first annual report and pay $45 when it comes due.
Before you pick either state
A few things that apply no matter which state you choose. These trip up enough first-time filers that they're worth stating explicitly.
Registered agent is non-negotiable. Both Colorado and Vermont (and every other US state) require every LLC to designate a registered agent with a physical street address in the state of formation. You can serve as your own agent if you live in the state; otherwise a commercial agent runs $50 to $125 per year. Using your own home address makes it part of the public record.
Forming elsewhere does not escape your home state's tax. If you live and operate a business from your home state, forming the LLC in Colorado or Vermont does not avoid your home state's income tax. The moment you transact business at home, your home state requires a foreign LLC registration, and state tax liability follows your residence regardless of where the entity sits on paper.
EIN applications are free. The IRS issues Employer Identification Numbers directly at no cost. Any service charging you to "get your EIN" is reselling a free form submission. Single-member LLCs with no employees technically don't need one for federal tax, but nearly every bank requires an EIN to open a business account.
Operating agreement matters more than the state you pick. A well-drafted operating agreement governs member ownership, management, profit splits, buy-sell terms, and dissolution. Without one, your LLC runs on the state's default rules, which are rarely what you want. California, Maine, Missouri, and New York require a written one by statute; every other state treats it as strongly recommended.
Agency contacts
Colorado Secretary of State - Business Division
- Website
- www.coloradosos.gov/pubs/business/main.html
- Phone
- (303) 894-2200
- sos.business@coloradosos.gov
- Colorado Secretary of State, 1700 Broadway, Suite 550, Denver, CO 80290
- Office
- 1700 Broadway, Suite 550, Denver, CO 80290
- Hours
- 8:00 AM to 5:00 PM Mountain, Monday to Friday
Vermont Secretary of State, Corporations Division
- Website
- sos.vermont.gov/corporations
- Phone
- (802) 828-2386
- SOS.CorporationsSupport@vermont.gov
- Vermont Secretary of State, Corporations Division, 128 State Street, Montpelier, VT 05633-1104
- Office
- 128 State Street, Montpelier, VT 05633-1104
- Hours
- 7:45 AM to 4:30 PM Eastern, Monday to Friday
Colorado Department of Revenue - Taxation Division
- Website
- tax.colorado.gov
- Phone
- (303) 238-7378
- Colorado Department of Revenue, P.O. Box 17087, Denver, CO 80217-0087
- Office
- 1881 Pierce St, Lakewood, CO 80214
- Hours
- 8:00 AM to 4:30 PM Mountain, Monday to Friday
Vermont Department of Taxes
- Website
- tax.vermont.gov
- Phone
- (802) 828-2505
- tax.business@vermont.gov
- Vermont Department of Taxes, 133 State Street, 1st Floor, Montpelier, VT 05633-1401
- Office
- 133 State Street, Montpelier, VT 05633-1401
- Hours
- 7:45 AM to 4:30 PM Eastern, Monday to Friday
Frequently Asked Questions
-
Is it cheaper to form an LLC in Colorado or Vermont?
Colorado is cheaper at formation ($50) than Vermont ($155). Ongoing costs are also different: $125 vs $145 per year. Total over three years: $425 vs $590.
-
Can I form an LLC in Colorado if I live in Vermont?
Yes, but your Vermont business will almost certainly need to register as a foreign LLC in Vermont too, which means paying Vermont's foreign registration fee and any ongoing Vermont obligations on top of the Colorado ones. The "form elsewhere to save" math usually doesn't work for operating businesses; it only works when you have no physical operations tied to any specific state.
-
How long does it take to form an LLC in Colorado vs Vermont?
Colorado online: 1 business day; Vermont online: 3 business days. Colorado does not offer paid expedite. Vermont does not offer paid expedite.
-
Which state has lower taxes for an LLC, Colorado or Vermont?
Colorado: state income tax applies to member-level pass-through income, no entity-level franchise or LLC tax. Vermont: state income tax applies to member-level pass-through income, no entity-level franchise or LLC tax.
-
Do both states require a registered agent?
Yes. Every US state (and DC) requires every LLC to maintain a registered agent with a physical street address in the state. Colorado and Vermont both have this requirement. You can serve as your own agent if you live in the state; most out-of-state filers use a commercial agent for $50 to $125 per year.
-
Which state should I pick if I run an online business from home?
Form in the state you actually live in. Your home state's Department of Revenue treats your residence as nexus regardless of where the LLC is filed, which means you owe state income tax there anyway. Forming in Colorado or Vermont to escape your home state's tax doesn't work; it adds paperwork. The non-resident filings make sense when you genuinely operate nowhere in particular: international founders, purely passive holding entities, or real-estate LLCs owning property in other states.
Full state guides
More Colorado and Vermont comparisons
More Colorado vs ...
Sources
- Filing fee: www.sos.state.co.us/pubs/info_center/fees/business.html · verified April 21, 2026
Colorado Secretary of State Business Organizations Fee Schedule: 'Limited liability company - Articles of Organization' = $50.00 online fee. Colorado accepts electronic filings only; there is no paper-filing option for new LLC Articles of Organization. - Expedited filing: www.sos.state.co.us/pubs/info_center/fees/business.html · verified April 21, 2026
Colorado does not offer expedited processing for standard online LLC filings because online filings are effectively processed same day (typically within 1 business day). An 'Expedited Service' line for paper document filing at $150 exists on the fee schedule, but it applies only to the limited categories of paper filings Colorado still accepts. For the LLC Articles of Organization (online-only), expedited service is not offered. - Foreign LLC registration fee: www.sos.state.co.us/pubs/info_center/fees/business.html · verified April 21, 2026
Foreign Entity Authority Statement = $100.00 online fee. - Operating agreement requirement: law.justia.com/codes/colorado/title-7/limited-liability-companies/arti… · verified April 21, 2026
C.R.S. §7-80-108 (Colorado Limited Liability Company Act). Operating agreements are permitted but not required, and need not be in writing except where a written form is specifically required (e.g. certain transfer restrictions under §7-80-108(3)). Recorded as not required. Justia is used here as a neutral statute mirror because the official Colorado legislative site (leg.colorado.gov) does not expose a stable per-section URL and the SoS reference page lists statutes only as PDF downloads. - Publication requirement: www.sos.state.co.us/pubs/info_center/laws/CRSTitle7index.html · verified April 21, 2026
Colorado imposes no LLC newspaper publication requirement. Colorado Title 7 Article 80 (the Colorado Limited Liability Company Act) contains no publication provision. - Annual report fee: www.sos.state.co.us/pubs/info_center/fees/business.html · verified April 21, 2026
Periodic Report = $25.00 online (online filing is the only option). Periodic Report Late Filing Penalty = $50.00. Fee increased from $10 to $25 effective July 1, 2024 per Colorado SoS press release. - Annual report: www.sos.state.co.us/pubs/business/FAQs/reports.html · verified April 21, 2026
SoS Periodic Reports FAQ (Q4): 'The Periodic Report can be filed two months prior to the Periodic Report month or two months after without any penalty.' The Periodic Report month corresponds to the month the entity was originally formed or registered in Colorado. Statutory basis: C.R.S. §7-90-501. - Franchise tax: tax.colorado.gov/corporate-income-tax-guide · verified April 21, 2026
Colorado has no franchise tax on LLCs or corporations. The Department of Revenue publishes only corporate income tax (flat 4.4%) and individual income tax (flat 4.4%) guidance; no capital-based or share-based franchise tax exists. - Corporate income tax rate: tax.colorado.gov/corporate-income-tax-guide · verified April 21, 2026
Colorado corporate income tax is a flat 4.4% rate on federal taxable income attributable to Colorado (C.R.S. §39-22-301), tax year 2024 and forward. LLCs are pass-through by default and do not owe corporate income tax unless they elect C-corp taxation. A Pass-Through Entity (SALT Parity) election allows LLCs to pay at entity level at the same 4.4% rate. - Sales tax rate: tax.colorado.gov/sales-tax-guide · verified April 21, 2026
Colorado statewide sales tax rate is 2.9%. Many Colorado cities are 'home-rule' and self-administer local sales tax, so combined state+local rates vary widely (commonly 4%-11%+). Only the 2.9% statewide rate is recorded here. - Business name search: www.coloradosos.gov/biz/BusinessEntityCriteriaExt.do · verified April 21, 2026
Colorado SoS Business Database Search. Resolves successfully in 2026. Note: the coloradosos.gov and sos.state.co.us domains both serve the same SoS website. - Filing fee: legislature.vermont.gov/statutes/section/11/025/04012 · verified April 21, 2026
11 V.S.A. §4012(a)(1): Articles of organization filing fee is $155.00. The fee was raised from $125 to $155 by 2023 Act 77 §37, effective June 20, 2023. Domestic LLC formation is filed through the Vermont Business Services Division online portal or by paper delivered to the Secretary of State. - Expedited filing: sos.vermont.gov/corporations/ · verified April 21, 2026
Vermont does not publish a formal expedited service tier for LLC filings. Online submissions through bizfilings.vermont.gov are generally processed within a few business days. The Secretary of State's Corporations Division has not promulgated fee rules for 24-hour or same-day expedited service comparable to Maine or Delaware. Recorded as not offered. - Annual report fee: legislature.vermont.gov/statutes/section/11/025/04012 · verified April 21, 2026
11 V.S.A. §4012(a)(15): Annual report of a domestic limited liability company fee is $45.00 (raised from $35 by 2023 Act 77 §37, effective June 20, 2023). §4012(a)(16): Annual report of a foreign LLC is $170.00. Report due date is set by 11 V.S.A. §4033(c): within three months after expiration of the company's fiscal year. - Foreign LLC registration fee: legislature.vermont.gov/statutes/section/11/025/04012 · verified April 21, 2026
11 V.S.A. §4012(a)(2): Application for certificate of authority (foreign LLC registration) filing fee is $155.00, raised from $125 by 2023 Act 77 §37. Same fee as domestic formation. - Operating agreement requirement: legislature.vermont.gov/statutes/section/11/025/04003 · verified April 21, 2026
11 V.S.A. §4003 governs the effect of the operating agreement. The operating agreement regulates the affairs of the LLC and may be stored or depicted in any tangible or electronic medium per §4001(20). Vermont statute does not require LLCs to adopt a written operating agreement; default chapter rules apply when no operating agreement exists. - Publication requirement: legislature.vermont.gov/statutes/chapter/11/025 · verified April 21, 2026
11 V.S.A. Chapter 25 (Vermont Limited Liability Company Act) contains no newspaper publication requirement for LLC formation. Not required. - Corporate income tax rate: tax.vermont.gov/business/corporate-income-tax · verified April 21, 2026
Vermont Department of Taxes Corporate Income Tax: graduated rate of 6.00% on the first $10,000 of Vermont net income; 7.00% on the next bracket to $25,000; 8.50% on income above $25,000. Top marginal corporate rate is 8.5%. Applies to C-corporations and to LLCs that elect C-corp treatment. - Sales tax rate: tax.vermont.gov/business/sales-and-use-tax · verified April 21, 2026
Vermont Department of Taxes Sales and Use Tax: statewide sales tax rate is 6.0% on retail sales of tangible personal property unless exempted. Local option sales tax of 1% applies in select municipalities but is not included in the statewide rate. Meals and rooms tax and alcoholic beverages tax are separate. - Franchise tax: tax.vermont.gov/business/corporate-income-tax · verified April 21, 2026
Vermont does not impose a franchise tax on LLCs. A $250 corporate minimum tax applies under 32 V.S.A. §5832 to C-corporations (and to LLCs that elect C-corp tax treatment), not to pass-through LLCs. Recorded as applies: false with nuance in taxes.notes. - Business name search: bizfilings.vermont.gov/online/BusinessInquire · verified April 21, 2026
Vermont Business Services Division business inquiry portal. Use to confirm name availability before filing Articles of Organization. - Online filing portal: bizfilings.vermont.gov/online/Account · verified April 21, 2026
Vermont Business Services Division online filing portal (Corporations Online Filing System, COFS). Most filings can be completed online with credit card payment. Paper filings accepted at 128 State Street, Montpelier. Typical online approval is 1 to 3 business days.