Colorado residents are reminded about use tax requirements

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— The Colorado Department of Revenue is reminding residents they are required to pay use tax on purchases for which state sales tax was not charged.

The reminder comes ahead of Cyber Monday sales from Internet retailers, which might not collect state sales tax, but use tax isn’t limited to online sales. Any purchase — whether online, from a catalog or an out-of-state seller — that doesn’t charge Colorado sales tax is subject to the use tax, which is 2.9 percent.

Individuals are expected to keep track of their purchases for which sales tax wasn’t charged and pay the use tax online at www.colorado.gov/revenueonline by April 15, 2014, for purchases made in 2013.

For now, Kathy Pugliese, of the Division of Taxation, said compliance is voluntary.

Pugliese said Tuesday that the voluntary aspect might change in the future. She declined to say if a Colorado resident would face penalties if audited today.

Some other special districts in Colorado also have a use tax, and home rule cities can charge certain use taxes.

Steamboat Springs charges a construction and vehicle use tax but does not have a general use tax, according to Director of Financial Services Kim Weber.

Sales tax paid in another state can be credited toward Colorado use tax, according to the state’s sales and use tax reference guide.

Colorado passed even more stringent requirements for online retailers in 2010, but a federal judge suspended enforcement of the HB10-1193, and a challenge now sits in state District Court in Denver.

When making a purchase on Amazon, the following note is located at the bottom of the checkout page: Colorado, Oklahoma, South Dakota and Vermont Purchasers: Important information regarding sales tax you may owe in your state.

The note links to information about HB10-1193 for Colorado residents.

The federal injunction of the law could be lifted before the end of January 2014 if a state judge does not continue the suspension.

To reach Michael Schrantz, call 970-871-4206, email mschrantz@SteamboatToday.com or follow him on Twitter @MLSchrantz

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Comments

Scott Ford 1 year, 1 month ago

The lessons of history still live on today.

Prohibition of alcohol failed because it was unenforceable. Prohibition resulted in many otherwise law abiding citizens who became wholesale law breakers. Prohibition created a culture where folks knew they were breaking the law but did not care or felt that the law did not apply to them or their situation.

This would be an interesting Reader Poll – Who plans on paying Colorado State sales tax of 2.9% on their on-line purchases made in 2013 where the state sales tax was not collected?

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rhys jones 1 year, 1 month ago

And after Jan 1, make sure you only get your weed through a legal outlet, what few of those there are and whenever they damn well please, so at least a quarter of what you spend goes not toward what you seek, but (ostensibly) the kiddies, who will hopefully grow up smarter than you are. Save your receipts; it's deductible.

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Harvey Lyon 1 year, 1 month ago

Scott,

But it is enforceable. The NSA already admits to collecting every transaction/communication over the Internet. Its a pretty easy leap from there to have the Government just send you a bill every year for Internet Sales Tax. Hey...it creates jobs for good Democratic voting patriots. :)

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Scott Wedel 1 year, 1 month ago

Cases like this are occasionally pursued when the amount of tax is substantial. I recall a case I think in NYC of an art dealer avoiding sales tax by routinely claiming it was being shipped out of state. When the sales are for hundreds of thousands of dollars then the enforcement action is worthwhile.

But for the Colorado Dept of Revenue to give that advisement days before gift purchases is simply stupid and reminds people of why to hate government.

The lack of sales tax reporting for online purchases is the same as holding a garage sale without a sales tax license. There are times that following the letter of the law just adds cost and isn't even cost effective to collect. I bought a printer cartridge online. How much staff time would it take to determine I owe a couple of dollars?

One of the great lessons of civil disobedience efforts is that a very effective way to make an unenforceable law to become unenforceable in practice is for lots of people to demand the law be applied. The Freedom Riders kept coming and violating the local segregation laws and the refused bail and upon a trial. That overwhelmed the local jails and local courts. Local governments couldn't bear the costs of keeping so many people in jail.

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Thomss Steele 1 year ago

I knew I forgot to do something this week. I promise to get right on it... Ha

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mark hartless 1 year ago

Maybe this wouldn't be a problem if the percentage of the population that lives by the motto "pay their fair share" just obeyed the "law of the land".

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