Colorado – Sales Tax Due for Home or Vacation Rentals

2/21/2013

SALT Report 2174 – The Colorado Department of Revenue updated a sales and use tax publication regarding home and vacation rentals such as hotels, motels, bed-and-breakfast inns, condominiums, campsites, and time shares. The publication states any rental of a unit for less than 30 consecutive days is taxable and as an owner you are required to collect and remit sales tax as well as any county lodging tax or a local district tax.

Property Management Companies

Companies that manage property that is owned by another party or entity are required to obtain a sales tax license for each taxing jurisdiction in which they manage rental properties. A license is required for each combination of county, municipal and special district taxes. For example, a property management company is managing several properties in Eagle County.There is a metropolitan district in a portion of unincorporated Eagle County. The property management company must obtain a license for property located within the metropolitan district in unincorporated Eagle County and another license for any property located within unincorporated Eagle County, but outside the metropolitan district.

However, if the property management company has two properties in unincorporated Eagle County that are located within the metropolitan district, those two properties will be on one sales tax license. The other sales tax license is for one property located within unincorporated Eagle County, but outside the metropolitan district.

Application

A CR 0100 Sales Tax/Withholding Account Application must be completed for each taxing jurisdiction. In the example above where there are two properties in one taxing jurisdiction, one property address within the jurisdiction is entered as the location address and the property management company address is entered as the mailing address. The sales tax license fee must be included with each application.

Home-rule cities that collect their own taxes may make their own regulations regarding the taxability of items. The home-rule city must be contacted directly for its own policies. Lists of local sales tax rates, along with tax office phone numbers for self-collected areas and home-rule jurisdictions, can be found in Colorado Sales/Use Tax Rates DR 1002.

Taxes Due

If you rent short term lodgings you will be required to file a DR 0100 Retail Sales Tax Return and, if applicable, a DR 1485 County Lodging Tax Return or DR 1490 Local Marketing District Tax Return. The DR 0100 Retail Sales Tax Return may be filed online. The DR 1485 County Lodging Tax Return or DR 1490 Local Marketing District Tax Return will be sent to you by the Department of Revenue as required.

For Further Information

Colorado Department of Revenue – FYI 11