Colorado has a flat 4.4% income tax that applies equally to all income levels — making it one of the simplest state tax systems in the country.
Colorado Tax Rate 2026
| Income Level | Tax Rate |
|---|---|
| All taxable income | 4.4% |
Unlike states with progressive brackets, Colorado taxes everyone at the same rate. Whether you earn $30,000 or $300,000, you pay 4.4%.
How Much Will I Pay in Colorado Tax?
| Taxable Income | Colorado Tax | Effective Rate |
|---|---|---|
| $30,000 | $1,320 | 4.4% |
| $50,000 | $2,200 | 4.4% |
| $75,000 | $3,300 | 4.4% |
| $100,000 | $4,400 | 4.4% |
| $150,000 | $6,600 | 4.4% |
| $200,000 | $8,800 | 4.4% |
| $300,000 | $13,200 | 4.4% |
| $500,000 | $22,000 | 4.4% |
Colorado Tax Calculation
Colorado starts with your federal taxable income (after federal standard deduction), then allows certain additions and subtractions. The result is multiplied by 4.4%.
Colorado Additions to Income
- State income tax refund (if previously deducted)
- Certain out-of-state municipal bond interest
- Lump-sum distributions not using 10-year averaging
Colorado Subtractions from Income
- Social Security benefits taxed federally
- Military retirement pay (up to $20,000 if under 55; $24,000 if 55-64; unlimited if 65+)
- Colorado pension/annuity exclusion (for ages 55+)
- Qualified state tuition program (529) contributions ($20,000 per beneficiary)
- ABLE account contributions
Colorado vs. Other States
| State | Top Rate | Type |
|---|---|---|
| Colorado | 4.4% | Flat |
| Utah | 4.55% | Flat |
| Illinois | 4.95% | Flat |
| Arizona | 2.5% | Flat |
| California | 13.3% | Progressive |
| Texas | 0% | No income tax |
Colorado’s flat rate is competitive compared to neighboring states.
Colorado Standard Deduction
Colorado doesn’t have its own standard deduction. Your federal taxable income serves as the starting point, which means you’ve already taken the federal standard deduction:
| Filing Status | Federal Standard Deduction (2026) |
|---|---|
| Single | $15,000 |
| Married Filing Jointly | $30,000 |
| Married Filing Separately | $15,000 |
| Head of Household | $22,500 |
Colorado Tax Credits
| Credit | Amount/Limit |
|---|---|
| Child Tax Credit | Up to 30% of federal credit |
| EITC (Earned Income Tax Credit) | 35% of federal EITC |
| Child Care Expenses Credit | Percentage of federal credit |
| Historic Property Preservation | 25% of qualified costs |
Colorado Family Affordability Tax Credit
For 2026, Colorado offers the Family Affordability Tax Credit (FATC) for lower-income families:
- For children under 6: up to $1,200 per child
- For children 6-16: up to $600 per child
- Income limits apply
Colorado TABOR Refund
Under TABOR (Taxpayer’s Bill of Rights), when state revenue exceeds limits, Colorado issues refunds to taxpayers. Recent refunds have ranged from $400-$800 per person depending on filing status.
Who Must File a Colorado Tax Return?
You must file if:
- You’re a Colorado resident with taxable income
- You’re a nonresident with Colorado-source income
- You’re eligible for a refund (even with no tax liability)
- You want to claim the EITC or Family Affordability Tax Credit
Filing Threshold
Because Colorado uses federal taxable income as the starting point, the effective threshold matches federal filing requirements. However, you should file to claim refundable credits.
Colorado Local Taxes
Several Colorado cities levy additional taxes:
- Denver: 0.55% occupational privilege tax (OPT) on employers and employees
- Aurora: 1.5% OPT (split between employer/employee)
- Greenwood Village: Local income tax
These are typically withheld by employers for employees working in those cities.
Colorado Sales Tax
| Tax Type | Rate |
|---|---|
| State sales tax | 2.9% |
| Average local sales tax | 4.8% |
| Combined average | 7.7% |
Colorado has one of the lower state sales tax rates, but local taxes can push combined rates above 10% in some areas.
Colorado Property Tax
| Metric | Amount |
|---|---|
| Average effective rate | 0.52% |
| Median home value | $515,000 |
| Median property tax | $2,678 |
Colorado’s property taxes are below the national average, partially offset by higher home values.
How to File Colorado Taxes
| Method | Cost | Best For |
|---|---|---|
| Colorado Free File | $0 | AGI < $79,000 |
| Revenue Online (DR) | $0 | All taxpayers |
| Commercial software | $0-$60 | Complex returns |
| Tax professional | $150-$400 | Business owners |
Filing deadline: April 15 (same as federal)
Extension: Automatic 6-month extension if you file federal extension
Colorado Tax Tips
1. Maximize 529 Contributions
Colorado allows a $20,000 deduction per beneficiary for 529 plan contributions — one of the most generous state benefits.
2. Check for TABOR Refunds
Don’t miss claiming your refund when eligible. Check your filing status and income level each year.
3. Claim the EITC
Colorado’s 35% match to the federal EITC can add hundreds to your refund.
4. Military Benefits
Colorado offers generous deductions for military retirement pay — up to full exclusion at age 65.
5. Senior Benefits
At age 55+, Colorado begins allowing pension exclusions that increase with age.
Colorado Part-Year and Nonresident Rules
| Status | What’s Taxed |
|---|---|
| Full-year resident | All income |
| Part-year resident | All income during residency + CO-source income |
| Nonresident | Only CO-source income |
Part-year residents calculate tax on total income, then prorate based on CO income percentage.
Key Takeaways
- Colorado’s flat 4.4% rate makes tax calculation simple
- Federal taxable income is the starting point — no separate state standard deduction
- 529 contributions can be deducted up to $20,000 per beneficiary
- TABOR refunds may provide additional cash back when state revenue exceeds limits
- Colorado EITC adds 35% to the federal credit for eligible filers
- Filing deadline is April 15 — same as federal