How to File
The withholding agent shall withhold 1% of the gross income from oil and gas owed to every interest owner, including the withholding agent if such agent is an interest owner.
Oil and gas withholding and estimated severance tax payments are due monthly and payments must be submitted via Electronic Funds Transfer (EFT). If you currently do not send EFT payments, set up an EFT account first using form DR 5785 .
The aggregate amount withheld each month must be paid by the first day of the third month following the month the tax is withheld. For example, the April withholding will be due on or before July 1. When submitting the EFT payment, use the last day of the month as the EFT "Filing Period" in year, month, date format (e.g. 080430 for April 2008). The "Tax Type" code will be 01180.
The estimated tax payment for each month must be paid by the 15th day of that month. For example, the July payment will be due July 15. When submitting the EFT payment, use the last day of the tax year as the EFT "Filing Period" in year, month, date format (e.g. 081231 for all monthly payments for 2008). The "Tax Type" code will be 08402.
If you experience a delay in receiving your authorization to submit EFT payments, you may file on paper using the Monthly Return of Oil and Oil Shale Tax Withheld (DR 0461) for the 1% withholding and the Corporate Estiamted Colorado Severance Tax (DR 0021P) for estimated tax payments until authorization is received. Paper returns must still be filed on a monthly basis. C ontinuing to file paper returns after EFT authorization is received or not applying for EFT authorization may result in penalty and/or interest charges on your payments.
If the due date falls on a weekend or state holiday payment is due the next business day. EFT payments must be received by the Department on or before the due date to be considered timely.