Colorado is one of the few states that recognizes the escorting industry as a legal trade and requires a license in order for both individual escorts and escort services to operate. In some ways, this is progressive and something to be proud of. In other ways, the judgmental nature that often surrounds this profession has some strong ties in Colorado's cities, and you need to be aware of what you'll be working with when starting your business.
In 1959, the city of Westminster came to this conclusion:
«The City Council hereby declares that the operation of escort services in this City affects the public health, safety, and welfare and that City regulation of such operation is in the public interest.»
This regulation within the state created high fees for escorting license applications and even higher ones for obtaining the accepted license. In the city of Westminster, the application fee is $200 for an escort, $300 for a service. If accepted, the license fee is an additional $500 for the escort, $5,000 for the service. Even if working under the umbrella of an agency, all escorts need an individual license.
Other cities are not as extreme, with much more manageable fees. But, no matter what, you must have a license to work as an escort in Colorado: "If a local authority does not license escorts, escorts and escort bureaus may not operate within that jurisdiction" (Colorado Office of Economic Development and International Trade).
In this article you'll find clear step-by-step advice on how to legally create your escort service within the state of Colorado, and links to where you can get more information. To learn why it's vitally important to register your business, refer to our article Don't get busted for tax evasion: Why registering your escort business is the only option.
Most registration forms in Colorado are done online, so make sure to consult them for the information you'll need and then return to them when you're ready to file.
Step four: Register your business / business name
Sole Proprietorship:
Sole proprietorships are not registered businesses with the government—they are simply an entity that helps you track profits and losses and report those with your own tax payments. So you don't need to register your sole proprietorship, another reason why this is a great choice for a small escort service.
In Colorado you are not required to register your name or a DBA name if it is your name and service: "Jane Doe's Escort Service". However, if you take on any other form of a DBA name, you have to register it with your Secretary of State. You can do this at the Secretary of State's website or by completing the online form.
Partnership:
General partnerships are not businesses that are registered with the government, and exist solely to help you run your business more efficiently and pay appropriate taxes to the government.
In Colorado you are not required to register your name if it is the name of the partners in the partnership agreement. However, if you take on any other form of a DBA name, you have to register it with your Secretary of State. You can do this at the Secretary of State's website or by completing the online form.
Corporation:
In Colorado you'll be automatically registering your company name when you file your Articles of Incorporation online with the Secretary of State. You'll need basic information such as where you company is running and the primary shareholders, as well as how many shares you'll be able to distribute. You'll also be able to search to make sure the company name is not being used in Colorado before you fill the form. You can do the search and fill out the form online at the Secretary of State's office.
Because of the complex nature of preparing a board and workout out shares, we suggest consulting a business lawyer in your area for more information.
LLC:
Your name will automatically be registered when you file your Articles of Organization with the Colorado Secretary of State. You'll be able to search the name availability for your service and then provide basic information about where you business will be running and who will manage it, and the members involved. You can find the form and more information at the website of your Secretary of State.
Step six: Register for your Colorado state and local city taxes
There are a few basic types of taxes small businesses in Colorado may register for:
- Individual Income Tax: The state collects income tax on each person making a profit in Colorado. If you're a sole proprietor, general partnership or LLC, you'll file your business profits/losses along with your personal income tax. For more information on each of these models and the forms you'll have to file, go to Colorado.gov.
- Taxes on Corporations: Corporations must pay taxes pending the amount of profit they make through a Form 112. More information on when and how to file form 112 can be found at Colorado.gov.
- If you have employees: If you have paid employees that are not members or owners of your company, you'll have to pay withholding tax to cover their Medicaid and Social Security contributions to the federal government, currently 4.63%. More information on wage withholding in Colorado.
- Self-Employment Taxes: If you own and operate your business and are not paid as an employee, you'll need to file your own self-employment taxes for social security and Medicaid. This is particularly true for sole proprietorships, general partnerships and LLCs. Download form 1040 or get more information.
More information on business taxes in Colorado can be found at the Colorado Department of Revenue.
You can pay Colorado taxes online.
Step seven: Get necessary licenses and permits
In Colorado you need a specific license to work as an escort or service in the state, which can be obtained through your city council. The registration fees vary by city, but the application processes are similar: you'll be asked about your legal history, if you've ever been in the military, the state of your physical and mental health, including if you've ever been institutionalized for mental health reasons. Most cities also require a background check, done by your local police department.
This procedure may seem invasive. Yet if you are seriously considering taking escorting on as a profession, it is important to register your business and obtain your license. If you work without one and are caught, you face serious legal battles that will be far harder than the registration process.
More information on licenses in Colorado is available at the Colorado Office of Economic Development.
More useful links
Find out how to register an escort business in each state of the USA.
Related resources:
Please note: Dating.com is not a legal service, nor are we tax advisors or accountants. We do offer you what we consider our best advice, but if at all in doubt, please consult a professional.
