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Colorado Department of Revenue issues Cyber Monday use tax reminder

  • Nov 27, 2017 | Gail Cole

 Colorado reminds internet shoppers to pay use tax if they owe it.

The Colorado Department of Revenue (CDOR) welcomed Cyber Monday with a use tax reminder. Use tax is owed whenever a vendor doesn’t collect tax on the sale of a taxable good or service. Colorado residents are most typically liable for use tax when they purchase taxable goods (for use or storage in Colorado) online or from a catalog from non-collecting, out-of-state vendors.

Customers should always keep a record (i.e., invoice, receipt) of non-taxed purchases. They’ll know sales tax wasn’t collected because they’ll receive a Transactional Notice from the non-collecting retailer, who is required to inform Colorado customers that state sales tax wasn’t collected and that they “may have a tax obligation to the state.”

The state use tax (2.9 percent) should be paid directly to CDOR. However, although CDOR does administer use tax for “certain special districts,” it doesn’t administer use tax for any city or county. Therefore, in most cases, local use tax should be remitted directly to the local government (e.g., Boulder County or the City of Loveland).

Colorado use tax must be remitted annually by the April income tax deadline, and it can be included in the Colorado income tax return. Alternatively, it can be reported and paid directly via a Consumer Use Tax Return, either electronically or by paper. See the Colorado Department of Revenue for more details.

Although individuals can be audited for use tax, businesses are more likely to be targeted for use tax noncompliance. Tax automation software facilitates sales and use tax compliance for businesses in all states, including Colorado. Learn more.

Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.