Master Settlement Agreement (MSA) Reporting Requirements
Each licensed cigarette and tobacco products distributor is required to file monthly a Licensed Distributor Reporting Form for Cigarette Sales of Non-Participating Manufacturer Brands (DR 1285) if cigarette brands manufactured by non-participating manufacturers are stamped and distributed for sale in Colorado.
If a cigarette distributor exports or transfers cigarettes manufactured by non-participating manufacturers, the monthly Licensed Distributor Reporting Form for Tracking Transfers of Non-Participating Manufacturer Cigarette Brands for Escrow Purposes (DR 1284) must be submitted to the Office of the Colorado Attorney General.
A distributor may qualify for an exemption from monthly reporting using Tobacco Distributor’s Certificate for Exemption MSA/Non-Participating Manufacturer Brands (DR 1286). This form can be used if:
- Cigarette distributor stamps and distributes only cigarette brands manufactured by participating manufacturers in Colorado.
- Cigarette distributor purchases stamped cigarettes from another Colorado cigarette distributor to sell to Colorado retailers.
- Tobacco products distributor sells at wholesale or retail in Colorado only tobacco products not subject to the Master Settlement Agreement (i.e. cigars, pipe tobacco, chew, etc.).
The DR 1286 exemption is valid for a period of 12 calendar months and must be renewed annually. A DR 1286 exempts the distributor from monthly reporting beginning the month after form DR 1286 is received by the department. The signed original form must be submitted to the department and a copy should be retained by the distributor. The exemption becomes void when a distributor stamps and distributes cigarettes manufactured by a non-participating manufacturer (NPM) under the MSA. Form DR 1285 is required beginning with the first month the NPM brands are stamped for Colorado. If the distributor again becomes eligible from an exemption from monthly reporting, a new exemption period will begin when the distributor files another certification. The signed original must be submitted to the department and a copy should be retained by the distributor. Form DR 1286 is an exemption from monthly MSA reporting, not for remittance of tax.
NOTE: Failure to comply with these reporting requirements may result in the revocation of a distributor’s license for a period of two years.
For additional information regarding the Master Settlement Agreement, visit the National Association of Attorneys General Web site.