Coronavirus Disease 2019 (COVID-19) in Colorado: State & National Resources

Severance Tax | Pay

Individuals & Corporations

Corporations that expect their Colorado severance tax liability for the year to exceed their Colorado severance credits by $5,000 or more are required to make estimated tax payments. Estimated tax payments are due each month by the 15th day of that month and must be submitted by Electronic Funds Transfer (EFT). To make payments through EFT use the Authorization For Electronic Funds Transfer for Tax Payments (DR 5785).  A paper voucher for these tax payments is not required. Individuals are not required to make estimated payments for severance tax.

Owners

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 by Electronic Funds Transfer (EFT). If you currently do not send EFT payments, set up an EFT account first using the Authorization For Electronic Funds Transfer for Tax Payments (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 Estimated Colorado Severance Tax (DR 0021P) for estimated tax payments  until authorization is received. Paper returns must still be filed on a monthly basis.  Continuing 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.
 
For more information, please see publication FYI Withholding 4, Colorado Oil and Gas Severance Withholding Requirements. Printable versions of the forms listed above can be found on the Forms in Number Order web page.