Colorado Department of Revenue
Taxpayer Service Division
1375 Sherman St.
Denver, Colorado 80261
Forms and other services:
(303) 238-FAST (3278)
Assistance:
(303) 238-SERV (7378)
www.taxcolorado.com

GENERAL INFORMATION

The Colorado Department of Revenue is responsible for collecting and administering local sales taxes for all counties, statutory cities and special districts that impose a sales tax. Sales taxes collected by vendors in such areas are to be reported on the “Colorado Retail Sales Tax Return” (DR 0100) and remitted to the Colorado Department of Revenue.

In some cases, home-rule city sales tax is administered and collected locally rather than by the state. The Colorado Department of Revenue has no jurisdiction over sales and use taxes imposed by home-rule cities when the state does not administer its local taxes. Taxes collected for such areas must be remitted directly to the home-rule jurisdiction. This FYI does not address the local taxes of self-administered home-rule cities. You must contact a home-rule jurisdiction directly to obtain its tax regulations. For information on local sales tax rates, request “Colorado Sales/ Use Tax Rates” (DR 1002). This publication is updated each January and July and may be obtained on the department’s Web site at www.taxcolorado.com

SALES TAX ON TANGIBLE PERSONAL PROPERTY

A retailer of tangible personal property with a business presence in a city, county, and/or the Regional Transportation District/Cultural and Scientific Facilities District/Metropolitan Football Stadium District (RTD/CD/FD) must collect all applicable local sales taxes on transactions consummated within the boundaries of that area. This does not include the sale or purchase of motor vehicles. See “Sales Tax on Motor Vehicles” section in this FYI.


Deliveries of Goods

Local sales taxes and RTD/CD/FD taxes are not collected when the retailer or his agent delivers tangible personal property, via the retailer’s vehicle, to a destination outside the boundaries of the vendor’s local taxing jurisdiction(s) or to a common carrier for delivery outside the boundaries of the vendor’s local taxing area(s). Delivery of the tangible personal property into another local taxing area does not require the vendor to collect the local sales taxes of the delivery area if the vendor does not have a business presence there. However, sold goods that are turned over to a contractor/subcontractor or other agent who is not primarily a common carrier for delivery outside the local taxing jurisdiction (for example, a carpet store turning over sold carpet to an independent installer who then installs the carpet for the purchaser), does not constitute delivery to another taxing area under this rule. The goods are taxable in the local jurisdiction where the contractor/subcontractor picks up the goods.

Vendors making retail sales which are exempt from local sales tax due to the delivery location bear the burden of proving that delivery took place outside the taxing area. For audit purposes, retailers should maintain invoices showing specifics of such deliveries by common carriers. For deliveries with the retailer’s own vehicle, the DOR recommends maintaining delivery invoices signed by the purchaser upon delivery which show date, time, place, and vehicle used.

RTD/CD/FD USE TAX

Because the RTD/CD/FD has a use tax, businesses that are not located in the RTD/CD/FD but make regular shipments into the district or have otherwise established nexus (a sales presence) in the district should collect the RTD/CD/FD tax and remit it on the “Colorado Retail Sales Tax Return” (DR 0100). If the RTD/CD/FD tax is not collected by the vendor, the consumer located within the district must pay the tax on Form DR 0252 “Consumer Use Tax Return.”

RURAL TRANSIT AUTHORITY (RTA)

Rural Transit Authority use tax must be paid if the sales are made to businesses located within the boundaries of the District. This tax is remitted on Form DR 0100 “Colorado Retail Sales Tax Return” in the Special District column.” See publication DR 1002 “Colorado Sales and Use Tax Rates” located on the Web for RTA boundaries and amounts. The DRP 1002 is revised annually in January and July and may be obtained on the Web at www.taxcolorado.com

Multi-Jurisdictional Housing Authority Tax

Effective January 1, 2007 Summit County approved a .125% (00125%) Multi-Jurisdictional Housing Authority Tax. This tax applies to all retail businesses within Summit County. The tax is computed in column 3 of the DR 0100 Colorado Retail Sales Tax Return. The 3 1/3 percentvendor’s fee does apply to this tax.

Additionally, a use tax of .125% applies when registering a motor vehicle in Summit County purchased or leased by a resident from an out of area dealer or leasing company.

Mobile Vendors

Those retailers who carry their inventory with them and make sales from that inventory directly to customers are classified as mobile vendors, and all local taxes must be collected. If you have not made sales in a particular taxing area previously, email your account number and identify the city and/or county to Contact by email

List the amount of sales and compute the tax for the city and/or county on a separate DR 0100. Be sure to write your account number and identify the city and/ or county on a separate sheet and staple it to the front of your sales tax return. You will then begin receiving returns for this jurisdiction.

Out-of-State Retailers

Out-of-state retailers who file Colorado retailer use tax returns (DR 0173) are responsible for collecting state sales/use taxes (and RTD/CD/FD/RTA taxes, if applicable) but are not required to collect sales taxes for any state-collected city or county, provided the retailer has no place of business in such state-collected city or county. Retailers that sell through a separate division over the Internet should collect local taxes for customers living in jurisdictions where they have a physical location if the customer can go to the local store to make returns, exchanges or receive service. For further information, request FYI Sales 5 “General Sales Tax Information for Out-of-State Businesses.”

Building Materials

Local sales tax is not due on building materials if the purchaser presents a building permit or other documentation acceptable to the local jurisdiction where the materials are purchased showing that a local use tax has been paid or is required to be paid to another local entity [§29-2-105(2), C.R.S.]. City and county use taxes on building materials are remitted directly to the local jurisdiction, not to the Department of Revenue.

Independent Distributors

These distributors are not required to have a sales tax license if the company itself has a license and remits all applicable sales taxes. The local tax liability is determined by the address of the independent distributor. If you are within this category, you may contact the Department of Revenue at (303) 238-SERV (7378) for more information.

Boats

Vendors of boats, boat motors and boat parts must collect all applicable state and local sales taxes. Boats are not treated as motor vehicles. However, boat trailers which require licensing and registration are treated as motor vehicles and are taxed as such (see below).

SALES TAX ON MOTOR VEHICLES

When the motor vehicle dealer and the purchaser reside in the same local taxing area, the dealer must collect all applicable local sales taxes (RTD/CD/FD, other special districts, county and city) in addition to the state sales tax. The state-administered taxes are to be paid to the Department of Revenue on the “Colorado Retail Sales Tax Return” (Form DR 0100).

RTD/CD/FD taxes apply to all purchasers living within the boundaries of this district. In order to facilitate titling procedures, dealers not located in the district should collect the tax from residents of the district and send the tax directly to the motor vehicle department of the purchaser’s county of residence along with the title application. RTD/CD/ FD taxes are not applicable to purchasers buying within the district but not residing in the district.

Purchasers buying a motor vehicle outside the limits of the local taxing entity where they reside will be required to pay any locally-imposed use tax when registering the motor vehicle. As with RTD/ CD/FD tax, dealers should collect local use taxes and send them directly to the motor vehicle department of the purchaser’s county of residence along with the title application.

Motor vehicles must be registered in the local jurisdiction of residence of the purchaser. For a private individual, this means the county and town where he/she is registered to vote. For a business purchaser, this means the business address from which the vehicle is principally operated and maintained. [§§1-2-102 and 31-10-201, C.R.S.]

Motor vehicle sales or trades between unlicensed, private individuals are subject to sales/use tax. The purchaser must pay the tax on the purchase price when registering and titling the vehicle.

COUNTY LODGING TAX

A county lodging tax shall be collected, administered and enforced in the same manner as state collected local city and county taxes. [§30-11-107.5, C.R.S.]. Tax is remitted quarterly on Form DR 1485 “County Lodging Tax Return.” See publication DR 1002 “Colorado Sales and Use Tax Rates” for a list of counties with lodging tax and amounts. The DRP 1002 is revised annually in January and July and may be obtained on the Web at www.taxcolorado.com

SHORT-TERM RENTAL TAX

Douglas County has a tax of 1 percent on property rented for 30 days or less (excluding motor vehicle). [§30-11-107.7, C.R.S.]. Tax is remitted monthly on Form DR 1480 “Colorado Short-Term Rental Tax Return.”

LOCAL IMPROVEMENT DISTRICT TAX

The Local Improvement District Tax is a sales tax collected within designated areas. For a list of designated areas subject to the Local Improvement District Tax see publication DR 1002 “Colorado Sales and Use Tax Rates.” This publication is revised annually in January and July and may be obtained on the Web at www.taxcolorado.com This tax is remitted on Form DR 0100 in the City/Special District Column.

MASS TRANSIT DISTRICT TAX

The Mass Transit District Tax is a sales tax collected by the state in designated counties. The tax is remitted on Form DR 0100 in the County Column combined with the county tax. Exemptions are the same as the county tax. For a list of designated areas subject to the Mass Transit District Tax see publication DR 1002 “Colorado Sales and Use Tax Rates” located on the Web at www.taxcolorado.com This publication is revised annually in January and July.

LOCAL MARKETING DISTRICT TAX

The Local Marketing District levies a tax on lodging services including hotels, motels, condominiums and camping spaces within specific areas in Colorado. The tax is remitted quarterly to the Department of Revenue on Form DR 1490, “Local Marketing District Tax Return.” See publication DR 1002 “Colorado Sales and Use Tax Rates” for a listing of designated areas subject to the Local Marketing District Tax and amounts. The DR 1002 is updated annually in January and July and may be obtained on the Web at www.taxcolorado.com

A NOTE ON USE TAX

Use tax must be paid by the purchaser of goods stored, used, or consumed by the purchaser where the seller did not or could not collect sales taxes. [§39-26-202, C.R.S.] This would include, for example, purchases by mail from an out-of-state business which is not collecting Colorado sales tax. It would also include goods and equipment purchased tax-exempt by a business and used by the business rather than being placed in inventory for re-sale. Merchandise that is purchased tax free for resale but later removed from inventory and used by the business must be reported on line 10 of the “Colorado Retail Sales Tax Return” (Form DR 0100) and all applicable taxes remitted.

Except for certain special districts which levy a sales tax, state-administered local jurisdictions do not have a use tax except that, at local jurisdictions’ election, they may impose a use tax on building materials and/or motor vehicles. The RTD/CD/FD (a combined special district which levies a sales/use tax) and RTA (see RTA section within this FYI) require a use tax be paid on all taxable goods in situations where sales tax is not collected.

DIRECT PAY PERMITS

Direct Pay Permits are not applicable to county lodging tax and/or county rental tax. [§§30-11-107.5 and 30-11-107.7, C.R.S.] See FYI Sales 78 “Direct Pay Permit for Colorado Sales Tax” and FYI Sales 1 “How to Document Sales Tax Retailers, Tax-Exempt Organizations and Direct Pay Permit Holders” for additional information. These FYIs are located on the Web at
www.taxcolorado.com under “FYIs.”

Direct Pay Permits are not applicable to self-collected and administered municipal sales taxes. Contact these municipalities directly for their rules or direct pay procedures.

FURTHER INFORMATION

FYIs and commonly used forms are located on the Web at www.taxcolorado.com For additional tax information visit the “Tax Information Index” which covers a variety of topics including links to forms, publications, regulations, statutes and general ques tions and answers. The “Tax Information Index” is located at www.taxcolorado.com

FYIs provide general information concernng a variety of Colorado tax topics in simple and straightforward language. Although the FYIs represent a good faith effort to provide accurate and complete tax information, the information is not binding on the Colorado Department of Revenue, nor does it replace, alter, or supersede Colorado law and regulations. The Executive Director, who by statute is the only person having authority to bind the Department, has not formally reviewed and/or approved these FYIs.