Failure-to-File Penalty Notification
As a result of the passage and signing of House Bill 09-1101 in March 2009, a failure-to-file penalty and interest assessment has been enacted for all sales tax and retailer’s use tax returns that are not filed timely or not filed completely and correctly.
If a sales/use tax return is postmarked after the due date of the return, the taxpayer will receive an assessment of 10% late penalty plus 1/2% for each additional month up to a maximum of 18% on the total tax amount plus interest and penalty-interest that has accrued up to the receipt date of the return (filing).
This late filing penalty assessment is valid and must be paid regardless of when the payment [submitted by mail, Electronic Funds Transfer (EFT) or Online] was received by the department.
If payment of a sales or retailer’s use tax liability is also late (not paid on time), based on the postmark date on the envelope of a mailed payment or an EFT submitted date, taxpayers will also receive a billing for failure to pay timely. This billing will be an additional 10% late penalty plus 1/2% for each additional month up to a maximum of 18% plus interest and penalty-interest. EFT payments are to be submitted by 4 p.m. Mountain Time on the due date of the return.
If you have received a billing from the Colorado Department of Revenue, you must include in your return submission:
1. A copy of the explanation letter.
2. The bottom coupon portion of the billing.
3. Full payment of the failure-to-file billing by check (this payment is not eligible for EFT payment) by the due date on the bill.