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April 2018 Update
You can sign up for EFT through your Revenue Online account or by using the Authorization for Electronic Funds Transfer (EFT) For Tax Payments (DR 5785). By signing up in Revenue Online, you can use your EFT Number and PIN Code the next business day. For more information on how to register, please visit: Electronic Funds Transfer (EFT).
Colorado’s EFT program offers two methods of electronic payment, ACH Debit and ACH Credit. You may choose either or both. We offer an ACH debit service which is accessible through the Web or telephone, or you may choose to initiate ACH credit payments through the banking system using a standard format. Both options are free, but you must be registered with the department to use either service. You may incur fees or charges from your financial institution. Detailed information on ACH Debit and Credit is available at Electronic Funds Transfer (EFT).
One Exception: At the end of the year, weekly/frequent filers must make a final transmission that includes all taxes withheld for all payrolls through December 31. Therefore, December 31 will be the filing period ending date for this transmission, even if it is not a Friday. The payment transmission is due three business days after December 31.
Employers who withhold more than $50,000 of withholding tax annually must file all payments by Electronic Funds Transfer (EFT).
Each year the Department determines withholding filing requirements based on an annual review of your account during the 12-month period of July 1 through June 30. For example, for the 2012 calendar year, we will look at the period July 1, 2010 through June 30, 2011. This is called a “look back period”. If the amount of Wage Withholding Tax remitted requires a more frequent filing schedule, the department will notify the employer before January of the next calendar year. If the employer is eligible to file less frequently the department will not change the filing status, the employer must request this change. Once we receive the request, the department will analyze your account to see if you are eligible. You must continue to file at your current frequency until we notify you of this change.
A household worker is your employee therefore, as the employer you should apply for a Colorado wage withholding account by using the CR 0100 (withholding account application). Or, you may apply online through Colorado Business Express. The withholding is submitted on a quarterly basis and a W-2 should be provided to the employee for tax purposes.
Also check with the IRS for federal information (such as the federal W-4 which is also used for Colorado income withholding) and the Colorado Department of Labor and Employment for other guidelines.
If you have a wage withholding account and there is no tax to report and you have a filing status of frequent, monthly, quarterly or seasonal you can file the return online through our Revenue Online service. When filing a zero return through Revenue Online you will first need to request a Letter ID number to be mailed to the address we have on your account. If you are not able to file online, you can file by paper using the Income Withholding Tax Return (DR 1094).
Note: After 12 months of consecutive filing of zero returns, you will receive a letter notifying you that your account should be renewed or the sales tax account portion of your Department of Revenue account will be closed.
If the overpayment is discovered during the year, you will claim the overpayment when you file the withholding annual reconciliation after January 1.
Overpayment of Withholding Tax from Previous Year
An overpayment of withholding tax from a previous year must be requested by filing a Claim for Refund (DR 0137) form. An original or amended form DR 1093 must be included. The form must show the year of the overpayment.
The Department of Revenue updates its wage withholding tables every other year beginning with odd-numbered years. For example, the tables effective Jan. 1, 2017 are valid through Dec. 31, 2018. You may download the DR 1098 withholding booklet and other withholding forms from our Wage Withholding Forms page.
The Colorado tax surcharge is related to unemployment insurance premiums paid by employers and is not related to any tax collected or administered by the Department of Revenue. Questions regarding unemployment insurance and this "solvency surcharge" must be addressed to the Colorado Department of Labor and Employment
The W-4 form is an Internal Revenue Service form. Colorado does not have an equivalent state form to the federal W-4. This is because the state income tax is based on the taxpayer's federal taxable income. An employer should use the information from the federal W-4 form to calculate the state wage withholding amounts. For employer information regarding Colorado withholding tax, see the Colorado Income Tax Withholding Tables For Employers (DR 1098).
Individual Wage Withholding Information