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franchise tax

A franchise tax is a state tax on businesses and other entities (corporations, limited liability companies, trusts, etc.) that are formed in or doing business in a state.

A franchise tax is said to be a tax on the privilege of doing business in a state and is sometimes referred to as a privilege tax. The amount of tax due is often calculated as a percentage of a business’s income, for example.

In Colorado, there is no specific tax referred to as a 'franchise tax' or 'privilege tax' for the privilege of doing business in the state. Instead, businesses in Colorado are subject to the Colorado Corporate Income Tax, which applies to corporations doing business in the state. The tax rate is a flat percentage of the federal taxable income of the corporation with certain adjustments specific to Colorado tax law. Additionally, other business entities such as limited liability companies (LLCs), partnerships, and sole proprietorships are typically not subject to the corporate income tax but may pass their income through to the individual owners who then report it on their personal income tax returns. It's important for businesses to consult with an attorney or a tax advisor to understand their specific tax obligations in Colorado.

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Taxes

franchise tax

Individual & Family Legal Plan

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Colorado State Code

Taxes

franchise tax

Colorado State Code

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