How to become an SGO in Colorado

1.Be a 501(c)(3) public charity

The IRS has to recognize you as a 501(c)(3), and you can't be a private foundation. Colorado accepts nonprofits whose Form 1023 is still pending. Under Treasury's temporary regulations, a state can list a nonprofit whose Form 1023 is still pending only if the exemption, once granted, takes effect by January 1 of the list year. For 2027, that means the nonprofit has to be incorporated by December 31, 2026. (An exemption reaches back to the date you incorporated if you file Form 1023 within 27 months.)

2.Register in Colorado

Treasury's rules count you as "located in" Colorado if you're authorized to do business there and follow its charity laws. You don't need an office or staff there. If you're incorporated in another state, you register with the Colorado Secretary of State ($100) and for charitable solicitation with the same office ($10). You'll also need a registered agent with a Colorado address.

3.Open a separate bank account for Colorado

Gifts for the credit go into an account that holds nothing else. If you're on more than one state's list, you keep one account per state and donors pick the state.

4.Put the §25F rules in your bylaws and policies

A new nonprofit has no track record, so the state reads its documents, and a promise to "follow the law" isn't enough. They have to require each rule: at least 90% of your income goes to scholarships, scholarships go to at least 10 students who aren't all at the same school, you verify household income, past recipients come first and then their siblings, no donor can earmark a gift for a particular student, and no scholarships go to insiders.

5.Register in the IRS SGO portal when it opens

Treasury asks every SGO to register in the IRS portal, ideally before a state lists it. The portal gives you the donor-number format your receipts use. It hasn't opened yet.

6.Apply to Colorado by November 30, 2026

Apply online through the Department of Revenue's Colorado SGO Application Portal (Form DR 1998) at sgo.colorado.gov; sign-in uses multifactor authentication with the Google Authenticator app. Attach your 501(c)(3) determination letter (or Form 1023 with Pay.gov proof of submission if your exemption is pending), a Certificate of Good Standing and a Certificate of Registration under the Colorado Charitable Solicitations Act issued by the Secretary of State within the last 90 days, and evidence of a §25F segregated account for Colorado, such as a bank statement. A first-time applicant also uploads its governing documents or bylaws and written policies that expressly require it to meet §25F's operating rules; a general promise to follow the law won't do. Submit by November 30, 2026: the department says it may not be able to consider later applications, and IRS rules don't let it add organizations after it files Colorado's list on January 1. Help: DOR_SGOApplications@state.co.us.

7.After you're listed

Send each donor a written acknowledgment by January 31 and report the gifts to the IRS by February 28. Under Treasury's proposed regulations, which you can rely on for 2027, you also file a yearly certification and report (with a copy to every state that lists you), get a yearly audit, and spend at least 90% of each year's income on scholarships by the end of the next year.