Colorado – Sales Tax Requirements for Short Term Rentals

SALT Report 2516 – The Colorado Department of Revenue issued an update regarding the taxability of short-term lodging units, which consists of any unit rented for 30 consecutive days or less. These rentals are subject to the state sales tax and in some cases they may be subject to a county lodging tax or a local marketing district tax.

Property Management Companies

If the rental unit is managed by a property management company, the company will be required to obtain a sales tax license for each combination of county, municipal, and special district taxes imposed in each jurisdiction that the managed properties are located.

For example, a property management company manages several properties in Eagle County which imposes a metropolitan district tax in an unincorporated portion of the County. The property management company would be required to obtain a license for the property that is within the metropolitan district area located in unincorporated Eagle County and another license for any 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. If there are two properties located 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. Also, the sales tax license fee must be included with each application or it will be rejected.

If a rental property is located in a home-rule city that collects its own taxes and makes its own regulations, that home-rule city must be contacted directly for its taxing policies and rates.

Required Returns

Owners of short-term lodging and rental units, or their property management companies, are required to file a DR 0100 Retail Sales Tax Return and, if applicable, a DR 1485 County Lodging Tax Return and/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 at the specific intervals.

For Further Information

Colorado Department of Revenue – COTaxInfo Blog

FYI Sales 11 – Sales Taxes Due on Unit Rentals of Hotels, Motels, Bed-and-Breakfasts, Condominiums, & Time-Shares