Colorado tax payment plan through Revenue Online

How do I request a payment plan from Colorado?

Colorado handles this process in a separate portal. The Revenue Online homepage says you can pay on a return or bill and can ask for a payment plan. The guidance How to Request a Payment Plan tells you to log in and pick Additional Actions to set up a plan.

Businesses follow a different path. That screen gives business owners a Business Payment Plan option, which opens the department’s guidance on business income tax installment agreements.

• If you have no Revenue Online username yet, create one.
• Log in, then choose Additional Actions.
• Pick the payment plan option and follow the prompts.
• As long as the plan is active, each new return needs to be filed and paid on time.

Why the payment form matters when a plan is active

Colorado applies a strict rule when it applies payments. Following the Colorado procedure and administration rules, 1 CCR 201-1, any payment that arrives with no department form or voucher goes to your oldest recorded debt first. Only after every other liability is paid does your current payment plan receive credit.

Make each plan payment the way your agreement directs. This applies if your debt involves more than one tax or covers more than one year. Your loose check might pay off some other bill, which could put the plan behind.

Interest charged on a Colorado balance

Interest begins on the date the tax was originally due and keeps running until you pay. Every year, the rate is three points above the Wall Street Journal prime rate. Section 39-21-110.5 of the Colorado Revised Statutes, title 39 says so. That rate is rounded to the nearest full percent. The banking commissioner picks the rate each July for the coming calendar year.

What happens when Colorado taxes stay unpaid

Section 39-21-114 and later sections set out collection tools. When a final deficiency goes unpaid for 30 days or another bill goes unpaid for 10 days after a demand, the department may issue a distraint warrant, an order to seize and sell property. Once a copy of that warrant is filed with a district court, it becomes a judgment. Recording it with a county puts a lien lasting six years on real property there.

Your bank and your paycheck can both be reached by a levy. Within 21 days, your bank must hand over your deposits. A wage levy keeps going with every pay period until it is released. It cannot take more than 25% of disposable earnings.

Colorado residents who fall more than 12 months behind on taxes may have their accounts handled by private debt collectors or attorneys. The fees they charge may not go beyond 20% of the amount they collect. Three or more warrants in a row trigger a 15% penalty. Six of them raise it to 30%.

Covered taxes and the IRS side

Income, liquor, cigarette and tobacco taxes, along with sales and use, fuel and severance taxes, are covered by these procedures under Colorado tax rules. Withholding and estimated payments are covered as well. You can read every statute cited here on the General Assembly’s statutes page.

A Colorado plan does nothing to a federal balance. The IRS requires an agreement of its own, so you make two payments on two schedules. Keep current on both, because each agency enforces the rules of its own plan.

Nearby states

• Wyoming
• Nebraska
• Kansas
• New Mexico
• Utah
• All states