What entity should your ABA practice use in Colorado?

Is ABA a licensed profession in Colorado

Yes, as of 2026, and this is the fact that changed. For years the answer was no. A 2020 sunrise review by the Colorado Office of Policy, Research, and Regulatory Reform found insufficient evidence of consumer harm to justify licensure, and Colorado remained one of the small group of states without a behavior-analyst license. That is no longer the position.

House Bill 26-1425 was signed on June 2, 2026. It adds Article 247 to Title 12 of the Colorado Revised Statutes, the Applied Behavior Analysis Practice Act, and it creates a five member Colorado Behavior Analyst Licensing Board within the Division of Professions and Occupations. From July 1, 2028, an individual may not engage in or offer to provide the practice of applied behavior analysis unless licensed (C.R.S. § 12-247-106). Practising without a license, and without an exemption, becomes a class 2 misdemeanor (C.R.S. § 12-20-407(1)(a)(V)(Y)).

Licensure requires a current certification in good standing with a certifying entity, which the act defines as the Behavior Analyst Certification Board, the Qualified Applied Behavior Analysis Credentialing Board, or another national body the licensing board identifies, plus a fingerprint based criminal history check. Licensed practitioners must also carry professional liability insurance in an amount the board will set by rule (C.R.S. § 12-247-122). The regulation is scheduled for sunset review and repeal on September 1, 2031.

So the old reasoning on this page is dead. The question is whether the answer died with it. It did not, and the next two sections explain why.

The entity menu: what an ABA practice can use

Although Colorado now licenses behavior analysts, the licensing act contains no professional-entity enabling clause, so no professional form is required to anchor. The menu is short and the answer is simple.

Colorado does have professional LLCs and professional corporations. What it does not have is a general rule that sweeps every licensed profession into them. The forms are made available profession by profession, by an enabling provision inside each profession's own practice act, and behavior analysis did not get one.

Why the professional-entity question does not apply to pure ABA

The instinct on reading a new licensure act is to assume the entity rules moved with it. In most states that instinct is right, because the professional entity statute is written generally and captures any licensed profession as soon as the license exists. Colorado is not built that way.

In Colorado the professional entity is opt in, profession by profession. A profession gets a professional service corporation or a professional limited liability company because its own practice act, inside Title 12, contains an enabling provision that grants it one. Medicine has that provision (C.R.S. § 12-240-138). Certified public accountants have theirs (C.R.S. § 12-100-114). The Colorado Secretary of State says the same thing in its own guidance: Title 12 specifies which professionals may form a professional service company.

Article 247 contains no such provision. The Applied Behavior Analysis Practice Act creates a license, a board, a scope of practice, a discipline regime, an insurance requirement, and a sunset date. It does not create a professional entity for behavior analysis, it does not require one, and it says nothing whatsoever about who may own an ABA practice.

Conclusion. A license now exists, but there is no professional entity keyed to it and no ownership restriction attached to it. The practice remains an ordinary business that delivers a licensed service, and it uses an ordinary LLC. The analysis still changes if a different licensed profession enters the practice. If a licensed psychologist is part of the clinical model, that profession brings its own ownership and corporate-practice rules, and the strict Colorado rules can attach to that component.

Who is allowed to own it

Anyone, and the 2026 licensing act did not change this. A standard Colorado LLC can be owned by licensees, non-licensees, or outside investors. Two independent reasons hold it open. First, the corporate-practice-of-medicine doctrine that limits ownership of medical practices (C.R.S. § 12-240-138) is medicine specific and does not reach behavior analysis. Second, Article 247 imposes no ownership rule of its own. It is worth being precise about that: the act was an opportunity for the legislature to require licensed ownership, as Illinois has done, and it declined to take it.

So a non-licensee co-founder or investor can still own a Colorado ABA practice directly. If a licensed profession such as medicine or psychology is in the clinical chain, the strict rules apply to that profession's services, and the ownership analysis tightens accordingly.

Registration wrinkles: psychotherapy and behavioral-health entities

The entity form is the easy part of Colorado. The exposure is next door, and an operator who reads only this page will miss it.

The facility question is now the urgent one. The same act that licensed behavior analysts also rewrote the definition of day treatment facility in the child welfare licensing statute. It dropped the headcount threshold from five children to three, added a four hour daily floor, and redrew the purpose test to cover any programme that assesses, treats, or promotes behavioral health, which the act now expressly defines to include autism spectrum disorder. A center based clinic that was outside that definition on May 1, 2026 and inside it now had to submit an application on or before August 1, 2026 (C.R.S. § 26-6-905(1.5)). Home based, school based, and community based ABA are excluded (C.R.S. § 26-6-904(1)(e)). This is the provision that will actually cost Colorado operators money, and it is worked through in full here.

Two older points still sit alongside the entity choice and should be confirmed with counsel, because they are about authorization to practise rather than entity form. ABA can fall within Colorado's legal definition of psychotherapy, and while behavior analysts practising within that definition historically registered as Unlicensed Psychotherapists, the state discontinued new registration in 2022 (HB22-1307). Separately, Colorado is moving its behavioral-health providers toward a Behavioral Health Entity licensing structure under the Behavioral Health Administration. Both are worth verifying directly, and both are now secondary to the day treatment capture above.

Naming the entity

A standard Colorado LLC name must include a limited-liability-company designator such as LLC, L.L.C., Limited Liability Company, or Limited Company, and must be distinguishable on the Secretary of State's records. Because a pure ABA practice uses a standard LLC rather than a professional entity, the special professional-designator naming rules do not apply. Clear the name with the Secretary of State before filing.

Why choosing the entity is only half the question

Picking the form is one decision. Who may own it, and how outside capital comes in, is the other, and in Colorado the answer is open for pure ABA: a standard LLC can carry non-licensee owners and outside investment without a management company, precisely because the corporate-practice doctrine does not reach the profession. The management-company structure becomes relevant only if a licensed profession joins the model, or for multistate reasons. Read the ownership page next if you are weighing investors or a licensed-profession component.

Read next: Do you need an MSO for your ABA practice in Colorado?

Tax treatment as a separate layer

Entity form and tax classification are separate choices. A Colorado LLC is taxed by default as a sole proprietorship or partnership depending on the number of members and can elect corporate or S-corporation treatment if it fits. The tax choice sits on top of the analysis above and does not change it; decide it with a tax adviser alongside the entity.

Multistate practice and foreign qualification

If you operate beyond Colorado, the Colorado LLC is only your home-state entity. To deliver services in another state you generally register there as a foreign entity and meet that state's own rules, which may be far stricter, including states that license behavior analysts and require licensee-only ownership. A non-licensee-owned LLC that is fine in Colorado can be impermissible elsewhere, so multistate groups usually standardize on a structure that satisfies the strictest state in the footprint. See the practice expansion and sale page for the multistate view.

How this connects to the rest of your compliance stack

Entity choice is one layer. Others interact with it:

• Ownership and outside capital. For pure ABA, Colorado generally does not require a management company. See the Colorado MSO and ownership page.
• Licensing and credentialing. The individuals delivering ABA hold BACB certification and, depending on scope, may face the psychotherapy-registration question. See licensing and credentialing.
• Facility licensure. This is now the sharp edge in Colorado. HB26-1425 captured center based clinics as day treatment facilities, with an August 1, 2026 application deadline. See facility licensure and HIPAA.

Forming the entity in Colorado: the sequence

1. Confirm the practitioners' credentials, licences, and scope. Certification with an approved certifying entity is required for the new state license, which becomes mandatory on July 1, 2028. Confirm the licensing runway now, and confirm whether the planned scope implicates Colorado's psychotherapy definition.
2. Form a standard LLC. File articles of organization with the Colorado Secretary of State (C.R.S. Title 7, Article 80).
3. Clear the name. Use a standard LLC designator and confirm availability with the Secretary of State.
4. Adopt an operating agreement. Set ownership and management; non-licensee ownership is permitted and is documented here.
5. Screen the behavioral-health entity and psychotherapy questions. Confirm with counsel whether any Behavioral Health Administration licensing or psychotherapy registration applies to your model.
6. Confirm with Colorado counsel. Especially if a licensed profession will be part of the practice or you plan to operate in other states.

Colorado entity variables at a glance

Frequently asked questions