Colorado Income
Tax Rates & Rules

Colorado has a flat 4.4% individual income tax rate for tax year 2026. The tax is applied to Colorado taxable income, which generally begins with federal taxable income then applies additions and subtractions required by Colorado law.

Colorado's official 2026 estimated income tax form, DR 0104EP, calculates estimated state income tax as 4.4% of estimated Colorado taxable income. A flat rate makes the basic calculation simpler than a graduated-bracket state, but Colorado-specific modifications, credits and alternative minimum tax can still change the final liability.

Source: Colorado 2026 Estimated Income Tax Form DR 0104EP

What Is the Colorado Income Tax Rate for 2026?

The Colorado individual income tax rate for 2026 is 4.4% of Colorado taxable income before applicable credits and other adjustments to final liability.

Colorado Taxable Income × 4.4% = Basic Colorado Income Tax

For example, $60,000 of Colorado taxable income produces $2,640 of basic Colorado income tax before credits, alternative minimum tax or other return-level adjustments.

Colorado has had temporary rate changes in some earlier years, so the tax-year-specific form matters. The 2026 DR 0104EP expressly uses 4.4%.

Source: Colorado Individual Income Tax FAQ

How Is Colorado Taxable Income Calculated?

Colorado generally starts with federal taxable income then modifies that figure with additions and subtractions required by state law.

• Complete the federal income tax calculation first.
• Start Colorado calculations with federal taxable income.
• Add amounts that Colorado requires to be added back.
• Subtract amounts Colorado specifically allows.
• Multiply Colorado taxable income by the 2026 rate of 4.4%.
• Add Colorado alternative minimum tax or recapture items when applicable.
• Subtract allowable Colorado income tax credits.

This federal starting point is why Colorado taxpayers normally need information from their federal return before completing the state return.

Important Colorado Income Addbacks for 2026

Colorado requires several additions that can make Colorado taxable income higher than federal taxable income. Two 2026 changes are especially important.

Federal Overtime Deduction Addback

For tax years 2026 and later, Colorado requires taxpayers who claim the new federal deduction for overtime compensation to add the full federal deduction back to Colorado taxable income.

Federal Standard or Itemized Deduction Addback for Certain High-Income Taxpayers

For tax years 2026 and later, certain taxpayers with federal adjusted gross income above $300,000 must add back the portion of their federal standard or itemized deduction that exceeds the Colorado limit. The guide lists a $1,000 limit for single filers and $2,000 for joint filers for 2026 and later.

Colorado also requires an addback for state income taxes deducted on the federal return, subject to the state's rules.

Source: Colorado Individual Income Tax Guide

Source: Colorado 2026 Tax Policy Updates

Colorado Income Tax Subtractions

Colorado permits specific subtractions from federal taxable income, so some income included federally may be reduced for Colorado purposes when the taxpayer meets the state requirements.

Available subtractions vary by tax year and taxpayer. The Colorado Department of Revenue publishes separate guidance for items such as qualifying pension and annuity income, certain Social Security benefits, military retirement, qualifying education awards and other statutory subtractions.

Taxpayers claiming Colorado subtractions generally report them on the applicable Colorado subtraction schedule. Eligibility should be checked against the current tax-year instructions.

Colorado Tax Credits for 2026

Colorado offers refundable and nonrefundable income tax credits that can reduce final state tax. Some credits changed for 2026.

Colorado Earned Income Tax Credit

For tax year 2026 and later, the Colorado Earned Income Tax Credit is generally 25% of the federal EITC the taxpayer claimed and was allowed, with special Colorado rules for some taxpayers who cannot claim the federal credit.

Child and Dependent Care Expenses Credit

Beginning in 2026, Colorado changed its child and dependent care expenses credit so the state credit can be based on the full federal credit for which the taxpayer was eligible even when federal tax liability prevented the taxpayer from using the entire federal credit. The federal AGI limit for the Colorado credit remains part of the eligibility test.

Disability Assistance Credit

Colorado introduced a Disability Assistance Credit beginning in 2026. The state describes the refundable credit as ranging from $400 to $1,200 based on income and filing status for eligible individuals with disabilities.

Source: Colorado Earned Income Tax Credit

Source: Colorado 2026 Tax Policy Updates

Source: Colorado Disability Assistance Credit

Does Colorado Have Alternative Minimum Tax?

Yes. Colorado has an individual alternative minimum tax that can apply in addition to regular Colorado income tax.

The Colorado Individual Income Tax Guide states that tentative Colorado minimum tax is generally calculated at 3.47% of Colorado alternative minimum taxable income after the required calculation. Colorado AMT applies only when tentative minimum tax exceeds regular Colorado income tax.

Source: Colorado Individual Income Tax Guide

Who Must File a Colorado Income Tax Return?

Colorado residents, part-year residents and nonresidents with Colorado-source income can have Colorado filing obligations.

Colorado generally requires an individual return when the taxpayer is required to file a federal income tax return or incurs Colorado income tax liability. Full-year residents are taxed on their Colorado taxable income while part-year residents and nonresidents use Colorado apportionment rules for the income subject to state tax.

Source: Colorado Individual Income Tax Guide

How Colorado Taxes Part-Year Residents and Nonresidents

Colorado part-year residents and nonresidents calculate tax using the Colorado rate then apply an apportionment percentage based on Colorado-source income under the state's rules.

Part-year residents and nonresidents generally use Form 104PN with Form DR 0104. The apportionment step is important because the 4.4% rate alone does not determine how much of a nonresident's total income is taxable by Colorado.

Colorado Withholding vs. Final Income Tax

Colorado wage withholding is a prepayment toward state income tax rather than the final annual tax liability.

An employee can receive a refund when withholding exceeds final tax after credits or owe additional tax when withholding is too low. Colorado Form DR 0004 can be used to fine-tune state withholding in certain situations.

To estimate the effect of state withholding on a paycheck, use the Colorado Paycheck Calculator.

When Are Colorado Estimated Tax Payments Required?

Colorado estimated payments may be required when income is not fully covered by withholding and the remaining net Colorado tax liability is significant.

The Colorado guide states that a taxpayer generally owes no estimated-tax payment requirement or estimated-tax penalty when net Colorado tax liability after credits, withholding and any applicable sales tax refund is less than $1,000.

Colorado's general required annual payment rules use the lesser of 70% of current-year net tax liability or 100% of the preceding year's net tax liability. For certain high-income taxpayers, the prior-year percentage is 110%.

Source: Colorado Individual Income Tax Guide