HB 24-1041

House Bill 24-1041, which has been approved by the Governor and will take effect on August 7, 2024, simplifies tax filing for small businesses in Colorado. It allows businesses that collect less than $600 in sales and use taxes per month to file their returns quarterly instead of monthly, reducing their administrative burden. Additionally, it restricts local governments from collecting state-level sales and use taxes from out-of-state retailers unless those retailers choose to do so voluntarily or through a special agreement. The bill also allocates funding for the Department of Revenue to implement these changes.

Official Summary

The executive director of the department of revenue (executive director) has been authorized to permit taxpayers that remit sales and use tax to the department of revenue and whose monthly tax collected is less than $300 to make returns and pay taxes at quarterly intervals. The act increases this threshold amount from $300 to $600 for returns that must be filed on or after January 1, 2025, and allows the executive director to further increase the threshold amount by rule for returns that must be filed on or after January 1, 2026. The act prohibits home rule cities, towns, and city and counties that collect their own sales and use taxes and do not use the electronic sales and use tax simplification system administered by the department of revenue from collecting sales and use tax from a retailer that does not have physical presence in the state unless the retailer elects to collect and remit sales and use tax or enters into a voluntary collection agreement with a home rule city, town, or city and county. For the 2024-25 state fiscal year, $17,200 is appropriated from the general fund to the department of revenue for the implementation of the act. APPROVED by Governor April 4, 2024 EFFECTIVE August 7, 2024(Note: This summary applies to this bill as enacted.)

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