How to Start a Non-Medical Home Care Business in Colorado: CDPHE Class B License and Placement Agencies

If you plan to start a non-medical home care business in Colorado, the first decision that shapes everything else is how your business delivers care. Personal-care-only services, meaning help with daily living tasks rather than skilled nursing, are licensed by the Colorado Department of Public Health and Environment (CDPHE) as a Class B home care agency. A home care placement agency, which matches clients with caregivers, is licensed separately. This guide walks through the entity, tax, and licensing steps in the order most owners handle them, with the figures we can verify and clear notes on the ones you must confirm with the agency.

This article is informational content, not legal or tax advice. Licensing rules and fees change, and agencies set their own schedules. Confirm every requirement with the agency named before you commit money, and talk with a Colorado attorney and a CPA about your specific structure.

What You Need Before You Start

Gather these items before you file anything:

• A written list of the services you will offer, such as bathing, dressing, meal preparation, medication reminders, and transportation. You need this list to tell whether your work is personal care, housekeeping only, or skilled care.
• A decision on your delivery model: employing caregivers, using contractors, or placing independent caregivers with clients.
• Two or three business name options, each checked against the Secretary of State business search.
• A Colorado physical street address for your registered agent, which can be your own office if it meets the rules described below.
• A federal Employer Identification Number (EIN) from the IRS, which you need for tax and payroll accounts.
• A business bank account, a basic written plan, and a budget that covers licensing, insurance, and wages before your first client pays.
• The CDPHE home care agency pages at cdphe.colorado.gov/home-care-agencies, plus the rules in 6 CCR 1011-1, chapter 26, which set the standards you must meet.

Step 1: Decide Which License Path Fits Your Model

Colorado separates home care businesses by the type of service they deliver, and that line determines which license applies.

• Class B home care agency: Provides personal care only, without skilled services. This is the license most non-medical owners need. It is governed by C.R.S. 25-27.5 and 6 CCR 1011-1, chapter 26.
• Class A home care agency: Provides skilled care and may also provide personal care. Choose this route only if you plan to offer skilled services.
• Home care placement agency: Matches clients with caregivers who are typically hired and paid directly by the client. It is a separate license from Class A and Class B. Ask CDPHE whether your matching model requires it and how it compares with a Class B agency.

Two exclusions may apply to small operations. Housekeeping-only services fall outside the personal care definition. A person acting alone with no employees or contractors may also be excluded. Do not rely on either exclusion until CDPHE confirms it for your exact services, and get that answer in writing. Once you hire a caregiver or subcontract work, the analysis changes, so plan for licensure from the start if you expect to grow.

Non-medical does not mean unlicensed. If your business sends caregivers into client homes as an agency, expect to hold a CDPHE license.

Step 2: Form Your Entity with the Colorado Secretary of State

Colorado has no general state business license. You start by forming your entity with the Colorado Secretary of State, Business Organizations Division. Most owners choose a limited liability company (LLC) or a for-profit corporation.

For an LLC, file Articles of Organization. The filing fee is $50, and you file through the Colorado SOS online filing system. Online filings are processed in real time, so the record updates right after payment unless your document sets a delayed effective date. A corporation files Articles of Incorporation for a Profit Corporation at the same $50 fee. An LLC's income passes through to its owners and is subject to Colorado's flat 4.40 percent income tax. A corporation pays the 4.40 percent corporate income tax rate.

Name rules

An LLC name must include a term such as Limited Liability Company, LLC, or Ltd. Liability Company. The name must also be distinguishable from existing names on Secretary of State records. Punctuation and capitalization do not make a name distinguishable, so Sunrise Care and sunrise care are treated as the same name. To hold a name while you finish your paperwork, you can reserve it for 120 days for $25, as described in the Secretary of State entity names FAQ.

Registered agent

Every entity must name a registered agent who has consented to the appointment. If you act as your own agent, you must be at least 18, hold a current valid Colorado driver's license or state ID card, and either live in Colorado or have a usual place of business there. Enter your name and ID number exactly as they appear on the credential. Without Colorado identification, you can request an agent passcode from the Secretary of State, which expires 45 days after it is issued. The registered agent address must be a physical Colorado street address where documents can be received during normal business hours. A P.O. box does not qualify.

Periodic report

Every LLC and corporation files a $25 Periodic Report each year in its periodic report month, which is shown on its record summary and is based on the formation anniversary. You may file as early as two months before that month and as late as two months after it without penalty. A new entity files no periodic report in its first year, so the first report is due in the second year. An entity that does not file becomes Delinquent.

Step 3: File a Trade Name If You Operate Under Another Name

If your public name differs from your legal entity name, such as Harbor Home Helpers operating under an LLC named Harbor Care Group, file a Statement of Trade Name. It is filed statewide with the Secretary of State, not with the county. The fee is $20 to file online and $5 to renew. Details are in the Secretary of State trade names FAQ.

Step 4: Set Up Tax Accounts with the Department of Revenue

The Colorado Department of Revenue, Taxation Division, administers state taxes at tax.colorado.gov. For a personal care business, the main questions are these:

• Sales tax: Services are generally not subject to Colorado sales tax, so a business that sells only care services usually does not need a sales tax license. If you sell tangible goods, you may need one. The state rate is 2.9 percent, plus special district taxes. Home-rule cities, including Denver, Aurora, Colorado Springs, Boulder, and Fort Collins, collect and license their own city sales tax, so a state license does not cover them. Confirm your status with the Department of Revenue before you sell goods.
• Withholding: Once you have employees, you must open a Department of Revenue account to withhold state income tax from wages. Check the current withholding requirements with the Department of Revenue.
• Income tax: Your entity's income is reported on your federal and Colorado returns. Ask a CPA how the 4.40 percent rate applies to your structure.

Step 5: Register as an Employer

Hiring caregivers adds registrations beyond the Secretary of State and Department of Revenue. Check with the Colorado Department of Labor and Employment (CDLE) on unemployment insurance registration. Check with the FAMLI Division on whether paid family and medical leave premiums apply to your staff and how they are reported. Ask your insurance agent about workers' compensation, which most employers with staff need to carry. Confirm the amounts and deadlines with each agency, because they change.

Step 6: Apply for the CDPHE Class B License

This is the core licensing step. Before you submit your application, read the statute and rules together:

1. Review the authority. C.R.S. 25-27.5 sets the statutory framework. 6 CCR 1011-1, chapter 26 contains the detailed operating requirements, including background checks, staffing, and training.
2. Build your compliance file. Draft your policies, client service agreements, caregiver hiring procedures, and training records before you apply. Confirm the specific documents CDPHE requires with the agency, because the list changes and the rules control.
3. Plan for background checks. Caregivers and administrators are subject to background check requirements. Check 6 CCR 1011-1, chapter 26 and CDPHE for who must be checked, what is required, and how results are handled.
4. Plan staffing and training. The rules set qualifications and training obligations for staff. Build recruiting and onboarding costs into your budget, and confirm the requirements with CDPHE.
5. Pay the license fee. CDPHE sets license fees each year and publishes the schedule by March 1 for the July 1 fiscal year. Check the Facility Fees page on the CDPHE website for the current amount. Do not budget from an older figure.
6. Ask about processing time. Review timelines for licensure are not set out here. Ask CDPHE for its current processing time, and build that into your launch date before you sign a lease or commit to clients.

Step 7: Address Health First Colorado Rules If You Serve Medicaid Members

If you plan to serve Health First Colorado members, your agency must also follow Health Care Policy and Financing (HCPF) rules. Under Community First Choice, personal care providers must hold Class A or Class B licensure. Ask HCPF which enrollment, billing, and documentation rules apply before you accept referrals or submit claims.

Step 8: Get Local Permits

Colorado issues no single statewide business license. After state filings, check with your city or county for local business licenses, zoning rules for home-based offices, and any local permits that apply to your address. If you operate in a home-rule city, apply directly to that city for its licenses and sales tax, because state registration does not cover them. Start with the city or county clerk and the planning department.

Step 9: Set Up Insurance and Operations

Talk with a licensed insurance agent before your first client. Ask about general liability coverage, professional liability coverage, workers' compensation for staff, and commercial auto coverage if caregivers drive clients. Keep copies of every policy in your compliance file, because CDPHE and your clients may ask for them.

Tips and Common Mistakes to Avoid

• Assuming non-medical means unlicensed. Personal-care-only agencies are licensed by CDPHE. Operating without a license is a serious risk.
• Relying on an exclusion too long. A solo operator may fall outside licensure, but hiring the first caregiver or subcontractor can change that. Get CDPHE's position in writing.
• Confusing placement with a Class B agency. Matching caregivers with clients is a separate license. Ask CDPHE which model you are running before you advertise.
• Using a P.O. box as the registered agent address. The Secretary of State requires a physical Colorado street address.
• Missing the periodic report. Your first report is due in year two, and the $25 fee is small compared with the cost of becoming Delinquent.
• Using old fee numbers. CDPHE sets fees annually. Check the current schedule before you pay.
• Skipping local permits. State filings do not cover city or county licenses, and home-rule cities license separately.
• Hiring before your compliance file is ready. Background checks, training records, and policies should exist before the first shift.

What Results to Expect

Completing the Secretary of State filings can be quick, since online filings process in real time. Licensing is a longer step. The CDPHE review depends on the completeness of your application and the agency's current workload, so a well-organized file may help you avoid avoidable delays, but no outcome is guaranteed. Owners who finish the entity, tax, and employer steps before they apply to CDPHE are generally better positioned to answer follow-up requests quickly. Revenue depends on your local market, referral sources, and staffing, and nothing in this guide promises a particular income.

Colorado Fees at a Glance

Item	Amount	Where to confirm
LLC Articles of Organization or corporation Articles of Incorporation	$50	Colorado Secretary of State
Name reservation (120 days)	$25	Colorado Secretary of State
Periodic Report (from year two)	$25 per year	Colorado Secretary of State
Statement of Trade Name	$20 online; $5 to renew	Colorado Secretary of State
CDPHE Class B home care agency license	Set yearly. Check the Facility Fees page	CDPHE
State sales tax license (only if you sell taxable goods)	Check with the agency	Colorado Department of Revenue
FAMLI premiums	Check with the agency	FAMLI Division
City or county business license	Check with the agency	Your city or county

Next Steps

Start with the Secretary of State filings, since they are quick and create the legal entity your license application will name. Then work through tax and employer registrations, and build your CDPHE compliance file before you apply. For help with planning, the Colorado Small Business Development Center Network and the SBA Colorado district page list local resources. For complex situations, such as combining placement and Class B services, or serving Medicaid members, consult a qualified Colorado attorney and a CPA before you commit.

This article is informational content, not legal or tax advice. Verify all fees, deadlines, and licensing requirements with the agency named in each section before you rely on them.