Colorado State Taxes
Quick Tax Facts
Income Tax: 4.4%
State Sales Tax: 2.9% 
Median Property Tax: $1,437
Overview
Colorado’s natural beauty and laid-back lifestyle are a draw for many prospective residents. It’s also one of many states where recreational marijuana is legal – though retail purchases are taxed at 15%. And while housing prices have soared across the state, its property tax rates are still fairly low compared to the rest of the county. Overall, Colorado is ranked among the top 10 states with the lowest tax burden.
Colorado Income Tax
Since 1987, Colorado has used a flat tax rate applied universally to all income brackets. It is one of only nine states that still has a flat tax. Of the states that do have a flat tax, rates range from 3.07% (Pennsylvania) to 5.25% (North Carolina). For the 2023 tax year, Colorado’s tax rate is 4.4% thanks to the passage of Proposition 121.
Who Must File?
According to the Colorado Department of Revenue, you must file a Colorado income tax return if any of the following are true:
- You are a full-year resident of the state, or
- A part-year resident who earned taxable income while residing in the state, or
- A non-resident with a Colorado income source,
AND
- You are required to file a federal income tax return, or
- You have Colorado income tax liability for the year.
Colorado taxpayers with higher taxable incomes may also be required to pay a state alternative minimum tax (AMT). The AMT is payable only to the extent that it exceeds the regular state income tax.
Colorado Sales Tax
Colorado has a state sales tax rate of 2.9%. Cities, counties, and special districts may also impose additional sales taxes of up to 8%. The average local sales tax is 4.87% and the combined average (state and local) is 7.78%. Grand County has the highest combined sales tax rate at 11.2%. Cheyenne and Kiowa counties have the lowest at 4.9%.
Other local government organizations may also collect local sales taxes, such as school districts. Additionally, certain purchases may be also subject to special sales taxes that can be as high as 11.25%. Groceries and prescription drugs are exempt from sales taxes.
Colorado Property Taxes
Colorado property taxes are levied at the local level and all revenue stays within the county. The amount you pay is based on your home’s assessed value (market value x residential assessment rate = assessed value) and the local total tax rate. For 2023, the assessment rate for a residential single-family or multi-family home is 6.765%.
For example, if your single-family home has a market value of $300,000, the assessed value is approximately $20,295 ($300,000 x .06765 = $20,295).
To determine your tax, multiply the assessed value by the local tax rate (assessed value x tax rate = taxes). Local tax rates are expressed in mills, which are equal to $1 for $1,000 of property value. If a county has a tax rate of 8.5%, your property tax bill would be approximately $1,725.08 ($20,295 x .085 = $1,725.075).
The median tax bill in Colorado is $1,437. Douglas County has the highest average tax bill at $2,590, while Costilla County has the lowest at $317.
| Highest | $2590 |
|---|---|
| Median | $1437 |
| Lowest | $317 |
Yearly Cost Per Resident
Colorado Tax Holidays
There are no tax holidays scheduled in Colorado at this time.
Colorado Tax Resources
If you need assistance preparing your Colorado state taxes, you can speak with a tax professional from Tax Defense Network by calling 855-476-6920.
You can also visit the Colorado Department of Revenue for additional resources.
- Colorado Income Tax Forms
- Payment Options
- Taxpayer Helpline: 303-238-7378 or DOR_TaxpayerService@state.co.us
- Where’s My Refund?
