Colorado residents are reminded about use tax requirements
November 26, 2013
Steamboat Springs — The Colorado Department of Revenue is reminding residents they are required to pay use tax on purchases for which state sales tax was not charged.
The reminder comes ahead of Cyber Monday sales from Internet retailers, which might not collect state sales tax, but use tax isn't limited to online sales. Any purchase — whether online, from a catalog or an out-of-state seller — that doesn't charge Colorado sales tax is subject to the use tax, which is 2.9 percent.
Individuals are expected to keep track of their purchases for which sales tax wasn't charged and pay the use tax online at http://www.colorado.gov/revenueonline by April 15, 2014, for purchases made in 2013.
For now, Kathy Pugliese, of the Division of Taxation, said compliance is voluntary.
Pugliese said Tuesday that the voluntary aspect might change in the future. She declined to say if a Colorado resident would face penalties if audited today.
Some other special districts in Colorado also have a use tax, and home rule cities can charge certain use taxes.
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Steamboat Springs charges a construction and vehicle use tax but does not have a general use tax, according to Director of Financial Services Kim Weber.
Sales tax paid in another state can be credited toward Colorado use tax, according to the state's sales and use tax reference guide.
Colorado passed even more stringent requirements for online retailers in 2010, but a federal judge suspended enforcement of the HB10-1193, and a challenge now sits in state District Court in Denver.
When making a purchase on Amazon, the following note is located at the bottom of the checkout page: Colorado, Oklahoma, South Dakota and Vermont Purchasers: Important information regarding sales tax you may owe in your state.
The note links to information about HB10-1193 for Colorado residents.
The federal injunction of the law could be lifted before the end of January 2014 if a state judge does not continue the suspension.