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Income tax withholding
Employers are required to have a Colorado withholding account and remit Colorado withholding taxes if:
1. The compensation is subject to federal withholding for income tax purposes; and
2. Employees are Colorado residents (working inside or outside Colorado), or employees are nonresidents of Colorado performing services in Colorado. Employees who are not residents of Colorado and perform services in connection with any phase of motion picture production or television production or television commercials for less than 120 days during any calendar year are exempt from Colorado income tax withholding.
Colorado does not have a state equivalent of the federal form W-4. Employees should complete the federal W-4 for both federal and Colorado wage withholding tax purposes. The W-4 form should only be submitted to the Internal Revenue Service unless the employee has requested more than 10 withholding allowances, or an Exempt withholding status for wages expected to exceed $200 per week. Any W-4 form meeting that criteria should be sent to the Colorado Department of Revenue. Additionally, these W-4 forms should accompany a cover letter listing the employer name, address, EIN, and the number of Withholding Allowance Certificates included.
Unemployment taxes
All states finance UC primarily through contributions from subject employers on the wages of their covered workers. In addition, three states (Alaska, New Jersey, and Pennsylvania) collect contributions from employees. These taxes are deposited by the state to its account in the UTF in the Federal Treasury, and are withdrawn as needed to pay benefits.
Many states have adopted a higher tax base than what is provided in FUTA. Hawaii's wage base is usually higher and changes periodically. In all states, an employer pays a tax on wages paid to each worker within a calendar year up to the amount specified in state law. In addition, most of the states provide an automatic adjustment of the wage base if federal law is amended to apply to a higher wage base than that specified under state law. As a result of the many variables in states taxable wage bases and rates, benefit formulas, and economic conditions, actual tax rates vary greatly among the states and among individual employers within a state.
Wages subject to unemployment tax in this state equal $10,000.
Minimum and maximum rates in this state are 0.0 and 5.4 %. Rates apply to experience rated employers only and do not include applicable surtaxes or penalties.
Contacts
Income tax withholding
Department of Revenue
Unemployment taxes
Department of Labor & Employment
Regulations
Income tax withholding
Withholding Tax: §39-22-604 C.R.S.
www.lexisnexis.com/hottopics/michie/
Unemployment taxes
Colorado Regulations Concerning Employment Security
Department of Labor & Employment