Colorado’s new law

Colorado HB 1193 (which we wrote about a few weeks ago) is now the law in the State of Colorado.

Basic details are provided in Emergency Regulation 39-21-112.3.5. Complete details are in the bill which became law on February 24 (less than one week before it became effective).

If your company sells to any Colorado purchaser as of yesterday, your company must either voluntarily collect Colorado Sales Tax, or you must:

  1. Include the following notice on each invoice and receipt (failure to do so will subject your business to a $5 penalty, per invoice) :

    Although we, as the seller, are not obligated to collect Colorado sales tax, this purchase is subject to Colorado sales tax unless it is specifically exempt from taxation. This purchase is not exempt merely because it is made over the Internet or by other remote means. The State of Colorado requires that you file a sales/use tax return at the end of the year reporting all of your purchases that were not taxed and pay tax on those purchases. Retailers that do not collect Colorado sales tax, including ourselves, will provide you an end-of-year summary of your purchases to assist you in filing that report. Details of how to file this return may be found at the Colorado Department of Revenue’s website, http://www.taxcolorado.com. Please note that we are required by law to provide the Colorado Department of Revenue with a report of the total amount of all of your purchases from us at the end of the year.

  2. Your business must also send an end-of-year statement to all Colorado purchasers detailing that purchaser’s transactions over the past year, and reminding the purchaser of their obligation to report and remit all sales and/or use taxes to the Colorado Department of Revenue.
  3. Your business must also file an annual statement with the Colorado Department of Revenue detailing all the transactions of each Colorado purchaser.

Note: There is a time allowance for implementation to occur – so long as your business has made the changes to your invoices by April 30, 2010, any accrued per-invoice penalties (from 3/1/2010 through 4/30/2010) will be waived.

One Response to Colorado’s new law

  1. […] requirement bill, very similar to Colorado’s legally embroiled reporting requirement law, HB 1193. Fortunately AB 155 was amended several times since then to eliminate the more troublesome […]

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