Colorado State Tax Rulings
Free plain-English summaries of state tax letter rulings and advisory opinions issued in Colorado, with full citations and the original source on every page.
No Colorado rulings match these filters
Try a different search term or clear the filters.
Can a Colorado wholesaler without a state-issued sales tax license use the Multistate Tax Commission's Uniform Sales & Use Tax Resale Certificate to buy tax-free?
No. A wholesaler without a state-issued Colorado sales tax license cannot use the Multistate Tax Commission's Uniform Sales & Use Tax Resale Certificate, because that form requires attesting to a vali…
When a customer makes a large up-front payment to sign a car lease in Colorado, which local sales taxes apply to that payment and how does the dealer report them?
The up-front payment a customer makes when signing a Colorado motor-vehicle lease is sourced the same way as the monthly payments — to the lease's 'primary property location,' not the dealer's locatio…
Is a company that processes card payments for online merchants — and briefly takes 'flash title' to the goods — a retailer that must collect Colorado sales tax?
No. A company whose real role is processing card payments for international e-commerce merchants is not a Colorado retailer, marketplace facilitator, consignee, auctioneer, or seller — even under its …
Does a Colorado bakery have to charge state sales tax on packaged baked goods sold individually, in multi-packs, or as catering and bulk orders?
No. Cold, packaged baked goods sold by a bakery with no eating facilities are exempt from Colorado state sales tax as food for home consumption, including multi-packs and catering or bulk orders, as l…
When I buy something at a shopping center that charges a Public Improvement Fee (PIF), is that PIF part of the price that gets sales-taxed?
Yes. A Public Improvement Fee (PIF) — a private fee a developer or landlord adds to purchases at certain shopping centers to fund parking, landscaping, and other on-site improvements — is part of the …
Are factory-built (prefabricated/modular) home modules exempt from Colorado sales tax, and who owes tax — the manufacturer's suppliers, the builder, or the home buyer?
Mostly exempt. A Colorado maker of prefabricated/modular housing modules buys its materials tax-free under a wholesale/manufacturing exemption, and its sales of the finished modules are partially exem…
When a construction subcontractor fabricates and installs a staircase into a building, is its labor taxed, or only the materials it buys?
A construction subcontractor who buys materials to fabricate and install a staircase into a building is the consumer of those materials and owes Colorado sales or use tax on the materials it purchases…
If an event organizer charges a cancellation fee for a canceled event that would have included a hotel banquet hall and catered food, is that fee subject to Colorado sales or use tax?
No. A cancellation fee charged when an event — one that would have included a hotel banquet hall and catered food and drink — is canceled is not subject to Colorado state or state-administered local s…
Does a company that runs electric-vehicle charging stations (and isn't a utility) have to charge Colorado sales tax on the fees customers pay to charge?
Generally no. Fees a non-utility operator charges customers to use electric-vehicle charging stations are not subject to Colorado state sales tax, because EV charging is a discrete, one-time sale rath…
If my customer hires their own shipping company to pick up goods at my Colorado dock and deliver them out of state, is the sale sourced to my location or to the customer's?
The sale is sourced to where the customer actually receives the goods — not the seller's dock. When a buyer hires its own third-party carrier to pick up goods at the seller's Colorado location (an 'Ex…
If my utility passes through a municipal franchise fee on my gas or electric bill, is that fee subject to Colorado sales tax?
Yes. A municipal franchise fee — the charge a city imposes on a utility for using its streets and rights-of-way, often passed through to customers — is part of the taxable purchase price of commercial…
Does a company have to charge Colorado sales tax on DNA-based ancestry and health reports and the saliva kits it sends customers — and does the company owe use tax on those kits itself?
Two answers. The DNA ancestry and health-history reports — and the saliva collection kits sold to customers to produce them — are NOT subject to Colorado sales tax, because the customer's 'true object…
Does Colorado charge sales tax on non-alcoholic beer, kombucha, sweetened bottled coffee, and insulin sold without a prescription?
Mostly taxable, with a nuance on insulin. Colorado charges sales and use tax on non-alcoholic beer and kombucha (any trace of alcohol disqualifies them from the food exemption) and on sweetened bottle…
If a contractor shows me a valid Colorado sales tax license, is that enough to sell them building materials tax-free for resale — and does it matter whether the goods go to their warehouse or a job site?
Yes. Verifying that a retailer-contractor holds a valid Colorado sales tax license is enough to treat their purchases of building and construction materials as tax-exempt resale purchases — whether de…
Is the industrial equipment a retailer buys to mass-produce baked goods in its in-store bakeries exempt from Colorado sales and use tax under the manufacturing machinery exemption — and does that exemption reach local taxes?
Yes. Industrial bakery equipment — mixers, dough dividers, ovens, oven racks, depositors, labeling machines, and the like — bought new for over $500 each and used directly and predominantly to mass-pr…
Is a subscription or membership fee whose main benefit is free delivery on future orders subject to Colorado sales or use tax?
No. An optional subscription whose primary benefit is unlimited free delivery on future orders is not subject to Colorado state sales or use tax. The membership is essentially prepayment for a deliver…
Is the delivery fee a retailer charges to bring a product to the customer subject to Colorado sales tax, if the customer could instead choose to pick the item up?
No. A delivery fee is not subject to Colorado state sales or use tax when it is both optional — the customer can waive it and pick the item up instead — and separately stated on the written sales agre…
Is an all-inclusive, bundled multi-day train 'travel experience package' — which lumps interstate train travel, on-board sightseeing/guides, catered meals, and a Colorado hotel night into one price — subject to Colorado sales tax?
No. Where a multi-day travel experience is sold as one inseparable, all-inclusive bundle, Colorado taxes it by the transaction's 'true object.' Here the true object is the nontaxable train travel expe…
Is propane (liquefied petroleum gas) sold to heat or cook in RVs, cabins, or tents at a campground subject to Colorado sales tax — and when does the special fuel tax or the residential-use exemption apply?
It's taxable. Propane (LPG) sold to heat or cook in RVs, cabins, or tents at a campground is subject to Colorado sales tax — these are temporary accommodations like hotels, so this is commercial consu…
At a restaurant, which tips are subject to Colorado sales tax — pooled tips, a mandatory gratuity the customer can't remove, and prepopulated tips the customer can remove at checkout?
It depends on whether the customer can decline the tip and whether all of it reaches the staff. Voluntary tips — including pooled and prepopulated tips a customer can remove at checkout — are NOT subj…
Are pre-cooked, packaged meals that a remote seller ships to Colorado customers — meals that need further cooking and aren't sold hot or with utensils — exempt from Colorado sales and use tax as food for home consumption?
Yes. A remote seller's pre-cooked, air-chilled, packaged meal products — shipped with FDA nutrition labels, not sold hot or with utensils, and requiring further cooking by the customer — are food for …
When a retailer sells grass seed, erosion-control blankets, and fertilizer to a construction contractor holding a DR 0163 exempt certificate, which of those are exempt from Colorado sales tax as construction and building materials?
It depends on the item. Grass seed and erosion-control blankets ARE exempt as construction and building materials when sold to a contractor who presents a current Contractor's Exempt Certificate (DR 0…
When a vendor or caterer sells alcoholic beverages to a Colorado state university for an official function, is that sale exempt from sales tax under the government-purchase exemption?
Yes, if the government-purchase exemption applies. Sales of alcoholic beverages to a Colorado state institution of higher education for official functions are exempt from sales tax, because alcohol is…
Are 'platform credits' that viewers buy on a live-streaming site and send to streamers — the kind that emphasize a chat message or unlock badges and overlays — subject to Colorado sales tax when bought or when redeemed?
No, on both counts. Selling 'platform credits' (viewer-purchased tokens on a streaming site) is NOT subject to Colorado sales tax — the credits work like gift cards, an intangible right with no intrin…
If a Colorado retailer adds a credit-card surcharge to a sale, is that surcharge part of the taxable purchase price — meaning the customer pays sales tax on it too?
No, if it's done by the book. A credit-card surcharge that complies with the conditions in § 5-2-212, C.R.S. — charged only when the customer chooses a credit or charge card, shown as a separate line …
Can a Colorado retailer advertise or post total 'out-the-door' prices that already include the sales tax, as long as the receipt breaks out the price and the tax separately?
Yes, but only if you meet two separate rules. A Colorado retailer may post total 'out-the-door' prices that include sales tax — but it must STILL (1) separately state the tax as a distinct item on eac…
Is the sale of bulk non-potable water — withdrawn from ditches and reservoirs and delivered through surface hoses to oil and gas wells — subject to Colorado sales tax?
No. Bulk water withdrawn from ditches and reservoirs and delivered to customers through conduits (surface lay-flat hoses) is not 'tangible personal property,' because Colorado's rules exclude water in…
Are shredded tires and railroad ties that a cement plant burns as an alternative fuel exempt from Colorado sales tax under the manufacturing-energy exemption?
No, they're taxable. Shredded tires and railroad ties that a cement plant burns as an alternative fuel to reduce its coal use are NOT exempt from Colorado sales tax. The manufacturing-energy exemption…
Are guided walking tours subject to Colorado sales tax, and what happens when food or drinks at a tour stop are included in the price?
It depends on whether food and drink are included. A guided walking tour by itself is a nontaxable service — it's not on Colorado's list of taxed services. But if the price includes food or beverages …
Does a Colorado seller charge sales tax on an implantable, single-use diagnostic heart monitor sold to healthcare providers, or is it an exempt medical device?
Yes, it's taxable. A single-use heart monitor implanted to diagnose irregular heartbeats is taxable tangible personal property when sold to healthcare providers. It does NOT qualify for Colorado's med…
Are subscriptions to an online learning platform — streaming video courses bundled with tutoring and advising — subject to Colorado sales tax, and is the platform's internet advertising revenue taxable?
Two answers. (1) Yes — the online learning subscriptions (all six plan tiers) ARE subject to Colorado sales tax. Even though they're delivered by streaming and bundle in tutoring and advising, the tru…
Does a Colorado crane rental company charge sales tax on cranes and hoists, and does it owe tax when it buys or moves the equipment into the state?
It depends on whether an operator is included. A crane or hoist rented with the company's own operator is a nontaxable service, so no sales tax is collected; instead the company owes sales or use tax …
Does an out-of-state seller with no Colorado location have to collect Colorado sales tax on prefabricated homes, and how much of the price is taxable?
It depends, with two answers. First, Colorado exempts 48% of the purchase price of prefabricated housing from state sales tax, and any later resale is fully exempt from state use tax; these exemptions…
Does Colorado charge sales or use tax on an aircraft that was bought out of state but is then based in or flown into Colorado?
No sales tax, but yes use tax. An aircraft bought outside Colorado is not subject to Colorado sales tax, but once it is based in or used in Colorado it owes Colorado use tax, and the expired aircraft …
Does a charity owe sales or use tax when it pulls resale inventory it bought tax-free and gives the items away to donors, customers, or performers?
It depends. Giving a gift is not a sale, so no sales tax is due on the act of giving — but the giver becomes the user and consumer of the item. When a charity buys goods tax-free for resale and then w…
Does a cable TV company owe Colorado sales tax on its basic and premium channel packages, sports packages, pay-per-view events, and video-on-demand?
No. A cable company's sales of basic and premium channel packages, sports packages, pay-per-view events, and video-on-demand are not subject to Colorado state or state-administered local sales tax, be…
Does electricity used in an apartment complex's common areas — pools, gyms, yoga rooms, clubhouses — qualify for Colorado's residential-energy sales-tax exemption?
No. Electricity used in an apartment complex's common areas — swimming pools, fitness centers, yoga rooms, clubhouses — does NOT qualify for Colorado's residential-energy sales-tax exemption and is ta…
Is a third-party company's charge for ERP-software maintenance and support — including tax, legal, and regulatory updates delivered electronically — subject to Colorado sales or use tax?
No. The company isn't selling taxable computer software — it's selling maintenance and support services. Even if some tangible personal property changes hands while providing those services, it is de …
Does a charity owe sales tax on its catering sales and on renting out its facility?
It depends. Catering — food and drink served by a caterer — is taxable in Colorado, but a charitable organization's sales can be exempt if they are for fundraising, number 12 or fewer in the calendar …
Does a restaurant owe sales tax on the trays, platters, and lids it buys and gives customers with food?
It depends on whether the item is essential to handing the food to the customer — and this GIL sets out the test without deciding it. A free article, bag, or container a food vendor gives a customer i…
When a buyer pays a separately stated fee for a program that pays a credit toward a replacement vehicle if their car is totaled or stolen, is that fee taxable — and does the credit count in the sales tax on the replacement vehicle?
The separately stated, optional program fee is NOT subject to sales or use tax — it buys an intangible right to future compensation, like an insurance premium, not tangible personal property. The comp…
For a company selling EV charging stations, must it collect sales tax on (1) the station, (2) an annual network fee, and (3) maintenance contracts?
A general overview, no binding determination. (1) Selling the charging station is a taxable retail sale of tangible personal property (and use tax can apply to its use). (2) The annual network fee is …
Does a billing-services company owe Colorado sales tax on the printed bills it produces, or on the separately stated postage it charges to mail them?
No to both. A company that turns clients' raw financial data into printed bills and statements is selling a nontaxable service, not taxable goods — the paper the bills are printed on is incidental to …
Is water and ice dispensed from a vending machine — into containers the customer brings — subject to Colorado sales tax, and does it matter that the machine sits just outside a bar?
No, they're exempt. Water dispensed in discrete quantities is tangible personal property (not a utility service), but it's still exempt as 'food': SNAP-eligible non-carbonated water sold from a vendin…
Can a pharmacy buy prescription bottles and labels tax-free — under the medical-materials exemption, or the container/label exemption?
Yes — but through the container exemption, not the medical-materials exemption. A pharmacy CANNOT use the medical-materials exemption, because that requires a 'licensed provider' with authority to pre…
When a restaurant buys dressing mix, compounds it into a condiment, and sells it to customers, is the purchase of the mix taxable and the sale of the condiment taxable?
It turns on whether the condiment is separately priced. If a restaurant just makes a condiment available (no separate charge), the restaurant is the user/consumer — like napkins or utensils — and pays…
When a company sells and installs a commercial sign, are its separately stated charges for surveying, engineering stamps, and permits included in the sales tax on the sign?
It depends on what the charge is really for. A sign is taxable tangible personal property, and a retailer's costs of bringing goods to market — government permits, engineering drawings, manufacturing …
Are the parts and the machinery a company buys to build an experimental aircraft prototype for its own research and development exempt from Colorado sales and use tax?
Mostly exempt. The parts a company buys and builds into an experimental aircraft prototype for its own R&D are exempt from Colorado sales and use tax — not under the 'components for resale' exemption …
When a company rents scaffolding and bills extras like sheeting, planks, lighting, delivery, on-site equipment, consumables, and erection labor, which of those charges are included in the Colorado sales tax on the rental?
It depends on the rental's length and how each charge relates to the rental — and this GIL lays out the framework without deciding the specific items. Key points: (1) for rentals of three years or les…
Is Colorado's paint stewardship fee on architectural paint part of the taxable purchase price — so that sales tax applies to the fee — and what if the paint sale itself is exempt?
Yes — and an amended clarification. Colorado's paint stewardship fee on architectural paint is included in the purchase price, so sales tax is calculated on the fee too. Sales tax is figured on the 'p…
Does a church have to collect Colorado sales tax on prepared meals and prepackaged food it sells to members, or can those sales be exempt as occasional sales?
Generally taxable, unless they qualify as 'occasional sales.' Sales by a church or other charitable organization are subject to Colorado sales tax, but are exempt as occasional sales if ALL three cond…
Are aircraft parts that are permanently affixed to an aircraft exempt from Colorado sales and use tax even when the aircraft is NOT used in interstate commerce by a commercial airline?
Yes. Tangible personal property permanently affixed as a component part of an aircraft is exempt from Colorado sales and use tax, and — unlike the exemption for the sale of the aircraft itself — there…
Is prescription pet food exempt from Colorado sales tax — and does it matter whether you buy it from your veterinarian or from a pet store?
It depends on where you buy it. Pet food is NOT a 'prescription drug' (food is excluded from the drug definition), so it can't be exempt on that basis. But prescription pet food can qualify for the ex…
When a customer gets a rebate from a manufacturer, utility, or government, is Colorado sales tax calculated on the full price or the price after the rebate?
On the full price, before the rebate. Manufacturer rebates are included in the Colorado sales tax base because a third party reimburses the retailer for that portion of the price, so tax is figured on…
When a company sells custom signage to Colorado customers, are its separately stated charges for delivery and installation subject to Colorado sales or use tax?
Generally no, for the delivery and installation. Colorado taxes the sale of the signage (tangible personal property) but not services. Delivery and installation are typically services, so those charge…
Is a company's monthly 'subscription' charge for energy-saving technology it owns and installs at the customer's site a nontaxable service, or a taxable rental of tangible personal property?
It depends — and this GIL does NOT decide it. The question is whether a monthly charge for company-owned energy-saving technology installed at the customer's site is a nontaxable service or a taxable …
For a subscription-box seller that doesn't collect Colorado tax: does each automatic monthly shipment need its own Transactional Notice, and what notices are owed when an out-of-state buyer ships the box to a Colorado resident?
Two answers. (1) No — for an auto-renewing subscription, a Transactional Notice is required only when the customer subscribes, enrolls, or renews; separate notices are NOT required for the repeated au…
Are the materials and components of orthodontic braces subject to Colorado sales tax?
It depends on where the material ends up. Orthodontic materials a licensed provider furnishes to the patient — that leave with the patient or are consumed by the patient at the office (like the braces…
Does a retailer owe sales or use tax on cooperative direct-mail advertising materials produced and mailed by a third-party advertiser?
No. A retailer that hires a cooperative direct-mail advertiser — one that bundles ads for several businesses into a single mailer — does not owe sales or use tax on the materials produced and mailed. …
Is a lessee's payment to a rental company for lost or damaged rental equipment subject to Colorado sales or use tax?
No. When a customer pays a rental company for equipment that is lost or damaged beyond repair, that payment is not subject to Colorado sales or use tax. It's compensation for the lost value of the com…
Browse Colorado rulings by topic
These are official tax letter rulings and advisory opinions issued by Colorado's revenue authority in response to questions from specific taxpayers about how the tax law applies to their facts. A ruling is binding on the department only for the taxpayer who requested it and cannot be relied on by anyone else, but it is strong evidence of how the state reads the law. Every ruling above has a plain-English question and short answer, plus a link to the full original source.