Like Many Things in Life, There is GOOD NEWS and BAD NEWS When It Comes to Managing Sales Tax

   Understanding Sales Tax

The GOOD NEWS about Sales Tax is WE CAN HELP YOU...

Let our expert staff help you navigate complicated Colorado Sales Tax regulations and research other states, so you can sleep at night and concentrate on making your business grow.

The BAD NEWS regarding COLORADO SALES TAX:

Colorado has one of the most complicated sales tax systems in the country, with separate rates and taxable items in each city and county.

Rates

If you will be selling a product to the end user, you must collect sales tax.  The amount of sales tax you collect depends upon the taxing districts where your business is located, the type of business you are in and how the transaction is completed.  To determine the amount of tax you must collect, you need to add together the various rates that apply to your business (DR 1002)

State

The 2.9% state sales tax must be collected by all businesses selling tangible, personal property located in Colorado.

Special Districts

Businesses located in the Denver Metro area are required to collect 1% for the Regional Transportation District (RTD), 0.1% for the Scientific and Cultural Facilities District (CD), and 0.1% for the Football Stadium District (FD) for a total of 1.2%. The RTD/CD/FD area includes all of Denver, Boulder, Broomfield and Jefferson Counties, the western portions of Adams and Arapahoe counties and the northeast portion of Douglas County, including Highlands Ranch and parts of Broomfield. Business located in Arapahoe, Adams, Boulder, Broomfield, Denver, Douglas and Jefferson Counties
must collect the Cultural Facilities District tax. Businesses located in (RTA) Rural Transportation Authority Districts are subject to sales/use tax of 0.4% in Basalt and Newcastle, 0.7% in Carbondale, 0.7% in Glenwood Springs, 0.2% in areas of unincorporated Eagle County, in the EL Jebel area and outside the city limits of Carbondale. A sales tax rate of 0.6% applies in Gunnison County with the exception of the cities of Marble, Ohio, Pitkin and Somerset. A rate of 0.35% applies within the city limits of Gunnison. Contact the Colorado Department of Revenue at (303) 238-7378 or download Form
DR 1002 (Colorado Sales tax/Use Tax Rates) at www.taxcolorado.com for more information on specific tax rates in your area. County Of Colorado’s 64 counties, 51 have established county sales taxes. All county taxes except use tax are collected by the state.

City
There are 217 cities that have established city sales taxes. Most small cities’ sales taxes are collected by the state. However, most of the larger cities (home rule cities) collect the city portion of the sales tax directly from the vendor and require a separate reporting form.

Other Rules

1. There are 26 counties and various cities that have established lodging taxes on hotels, motels, bed and breakfast, condominiums and camping spaces.
2. Special taxes such as the Local Improvement District tax, Mass Transit District tax, Public Safety Improvement (PSI) tax and Local Marketing District taxes.
3. Craft Shows - If you are selling at events, you must have a state multiple events license.  If the event is held in a city that collects its own city sales tax, you may be required to obtain an additional city sales tax license. And then there are Flea Markets...
4. There are rules regarding multiple permanent business locations or mobile businesses.
5. There are more rules if you operate a Small Home Businesses or have a charitable organization.
6. Wait there's more.  Do you know when to charge sales tax for Internet sales or sales affecting other states?

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