Metallic Minerals Severance Tax
Colorado Severance Tax is a tax imposed upon nonrenewable natural resources that are removed from the earth. In addition to any other tax, there shall be levied, collected, and paid for each taxable year a tax upon the severance from the earth in this state of all metallic minerals as to all such severance occurring on and after January 1, 1978. Such tax shall be levied against every mining operation engaged in the severance of metallic minerals and shall be based upon the gross income of such mining operation.
The severance tax rate for taxable years commencing on or after July 1, 1999 is as follows:
- First $19,000,000 in gross income = no severance tax
- Gross income exceeding $19,000,000 = 2.25%
Every individual, corporation, business trust, partner in a partnership, association, estate, trust or any other legal entity liable for the payment of Colorado metallics severance tax must file a severance tax return (DR 0020A). This return must be made for the same tax year used for federal income tax purposes and is due on or before the 15th day of the fourth month following the end of the taxable year.
Every corporation subject to Colorado severance tax must file a declaration of estimated tax (DR 0021PA) if its severance tax liability for the current tax year can reasonably be expected to exceed its Colorado severance tax credits by $5,000 or more.