Colorado registration and tax info

• Colorado Department of Revenue – income tax withholding
• Colorado Department of Labor and Employment 
  • Unemployment tax
  • Family and Medical Leave (starting in 2023)
• Local Colorado tax agencies – various

If you're starting a new business in Colorado, you'll need to register with the Colorado Secretary of State before registering with other agencies. Before you get started make sure you have the below:

• Federal Employer Identification Number (FEIN).
• A designated registered agent.

For companies formed outside of the state of Colorado, you'll want to double-check whether or not you need to register with, or provide documentation to, the Secretary of State. For more information about foreign business entities, check out the agency's FAQs here. 

Register for income tax and unemployment tax

1. Apply for both tax types online using MyBizColorado. 
   • Before you get started, check out the overview of the registration process from the agency.
2. Click Start when you're ready to begin the registration. 
   • This will get you registered with:
     • The Department of Revenue (DOR)
     • The Department of Labor and Employment (CDLE)
       • If your company is not yet liable for unemployment tax, your CDLE account won’t be activated just yet. Learn more below about what's required when you become liable. 

Once online registration is complete, you'll receive instant confirmation on MyBizColorado and they'll also send a letter in the mail. 

Enter the tax account information in Gusto

Once a valid Colorado work address has been added in Gusto for one or more employee(s), you can add your tax account information:

1. Go to the Taxes & compliance section and select Tax setup.
2. Scroll to the "Colorado Tax Setup" headline and select Manage taxes.
3. Enter your CO DOR withholding account number—this is typically an 8-digit number.
   • Gusto uses the withholding account number entered in Gusto to obtain your "Withholding Credit ID" from the agency—we need that ID, in addition to your account number, to electronically make payments on your behalf.
     • If we're unable to obtain the Withholding Credit ID for any reason, you'll need to call the agency at (303) 238-7378 to troubleshoot. Some common reasons we cannot obtain your number include:
       • An incorrect withholding account number was entered in Gusto
       • You haven't opened a withholding account under the number provided,
       • The legal name provided does not match what is registered with the state.
   • If you need to update your account number: Contact us from the Help or Priority support section of your account—there may be tax implications if taxes have already been paid or filed to an incorrect account number.
4. Enter your CO DLE unemployment account number—this is typically a 9-digit number, usually formatted "123456.00-9"
   • The 7th and 8th numbers are often both zeros.
   • If your company is not yet liable for unemployment tax, read below for what to do in the meantime, and what to do when you become liable.

Running payroll in Gusto before you're liable for SUI

Your company becomes liable for state unemployment insurance tax once the company has:

• Paid $1500 in wages during a calendar quarter or;
• Had at least one Colorado-employee working for any part of the week, for 20 or more different weeks during a calendar year.

If you need to run payroll and do not yet meet the above requirements, Gusto allows it—we just suggest you add the "New employer SUI tax rate" specific to Colorado in the meantime.

• You can find the new employer rates for each state in this article, along with instructions on how to update the rate once you become liable and receive your company-specific agency assigned rate.

Action required once the company becomes liable

Once you exceed $1,500 in wages, you’ll need to email [email protected]. The email should include:

• Account number
• Business name
• FEIN
• The first check date of Colorado-payroll
• The actual date that the $1,500 gross wage threshold was met or exceeded

Once the agency has assigned a company-specific unemployment rate, they'll send you a Notice of Employer's Tax Rate (Form UITR-7) in the mail. Enter that rate in Gusto from the Taxes & compliance section of an admin account.

If you have employees working in one of the following locations, you or your employees may be liable for an Occupational Privilege Tax (OPT):

• Aurora
• Denver
• Glendale
• Greenwood Village
• Sheridan

Scroll below to get registration information.

What is an Occupational Privilege Tax (OPT)?

This is a uniform tax that includes both an employee and employer tax.

• Employees who make over a certain threshold amount per month are taxed per month—wage thresholds vary by agency.
• Employers are taxed a flat amount per month for each employee—the employer tax per employee applies even if you do not run payroll.

Some Colorado cities also require employers to pay OPT for business owners and officers who are not included on payroll. In your Gusto account, we'll ask you to include how many business owners/officers are not considered employees but are subject to OPT taxes—do not include owners or officers that you are paying taxable wages.

Denver OPT registration and tax info

Who is subject to the tax?

The following are subject to the Denver OPT:

• Employees who earn equal or greater to $500/per month, and;
• Owners and officers (even if they aren't on payroll), and;
  • You'll need to let Gusto know about your owners and officers—find instructions below. 
• Partners or managers of businesses who perform business in Denver.

Certain employers, governmental or charitable entities whose employees are performing duties consistent with the organization's exempt status, may be exempt from the employer-portion of the tax (employees are never exempt). If you've confirmed an employer-exemption, let us know by contacting us from your account.

Let Gusto know how many business owners you have that are not considered employees, but are responsible for paying Denver OPT:

1. Head to the Taxes & compliance section and select Tax Setup.
2. Scroll to "Colorado Tax Setup" headline and click Manage taxes.
3. Edit the applicable field to tell us how many owners are subject to the tax. 

How is the tax calculated, and when does it get withheld?

We'll usually withhold the tax on the first payroll of each month—while we calculate and withhold the tax monthly, it'll be deposited to the agency based on your company's agency-assigned deposit schedule. 

• The employee portion of the tax is $5.75
• The employer portion of the tax is $4.00—aka the “business operations” portion.
• The total monthly assessment is $9.75/per employee (or owner/partner)

For months when there are no subject employees, employers still owe a $4 minimum for the “business operations” portion of the tax. 

Because the tax liability, in part, is based on employees' earned income, it's processed in arrears—this way we know how much they earned the prior month.

• Example: If you join Gusto in January, the Denver OPT liability for the month of January will get withheld at the beginning of February, once all January-wages have been processed.

How do I register for the Denver OPT?

1. Register a new business here. 
2. Scroll to the "Access & Registration" section and click Register a New Business.
3. If the agency required the company to file quarterly or annually, contact them at [email protected] to request that your filing frequency be changed to monthly.
   • Gusto defaults to the monthly deposit schedule which is recommended to avoid late payments and filings—we'll attempt to file monthly and if the filing fails, we'll update the schedule to the one assigned by the agency.

You can learn more about how taxation for Denver OPT works here.

Aurora OPT registration and tax info

The city of Aurora imposes an Occupational Privilege Tax (OPT) on individuals who work within the city limits.

Employees and employers are subject to the Aurora OPT of $2 per month if:

• Gross earnings are $250 or more per calendar month
• Employee works within the city of Aurora for any period of time during such month
  • An “employee” is any person who is subject to federal income tax.

Religious/charitable organizations may be exempt from paying the employer-portion of tax—however, the employer is still required to withhold and pay the employee-portion for employees of such organizations. If you've confirmed an employer-exemption, let us know by contacting us from your account.

Learn more about Aurora OPT.

How do I register for the Aurora OPT?

1. Register online here—registration time can take 10-14 days.
2. Request that your deposit frequency be set to monthly by calling the agency at (303) 739-7000.
   • Gusto pays Aurora OPT taxes monthly, the most frequent schedule, in an effort to minimize potential penalty or interest.
3. For Gusto to file and pay Aurora OPT taxes, you must give Gusto third-party access to your Aurora Tax & Licensing portal—to do so, follow the instructions in the How to authorize Gusto with CO agencies dropdown below.

Gusto accepts either the Aurora OPT Business License Account Number or the Aurora account ID. 

Sheridan OPT registration and tax info

The Sheridan OPT is withheld on payroll each month and has an employee-portion and employer-match—both are $3.

All employers engaged in business (as an owner, operator, or agent) within the city must pay this tax for each employee who:

• Performs all or part of his/her services within the city for any period of time in a calendar month and;
• Receives gross compensation of at least $500 for the month.

How do I register for the Sheridan OPT?

1. Register your business with the city.
2. Contact the city directly to request that your deposit frequency be set to monthly by calling (303) 762-2200.
   • Gusto pays Sheridan OPT taxes monthly, the most frequent schedule, in an effort to minimize potential penalty or interest.

Glendale OPT registration and tax info

Glendale OPT is withheld monthly for all employees who work within the city and earn more than $750 per month. The $5 monthly fee for these employees is matched by the employer, for a total tax of $10.

• Self-employed individuals, owners, partners, and officers, who are not paid a salary or commission (and may therefore not be on payroll), are subject to only the employer-portion of the tax—learn how to let Gusto know about them below.

How do I register for the Glendale OPT?

1. Register your business with the city.
2. Contact the city directly to request that your deposit frequency be set to monthly by calling (303) 759-1513.
   • Gusto pays Glendale OPT taxes monthly, the most frequent schedule, in an effort to minimize potential penalty or interest.

Let Gusto know how many business owners you have that are not considered employees, but are responsible for paying Glendale OPT:

1. Head to the Taxes & compliance section and select Tax Setup.
2. Scroll to "Colorado Tax Setup" headline and click Manage taxes.
3. Edit the applicable field to tell us how many owners are subject to the tax. 

Greenwood Village OPT registration

The Greenwood Village tax consists of a $2 employee-portion and $2 employer-portion per month (total of $4)—both apply when $250 or more is earned in a calendar month. Owners, partners, and officers who do not earn a minimum of $250 a month (and may not be on payroll) are only subject to the employer portion—learn how to let Gusto know about them below.

How do I register for Greenwood Village OPT?

1. Register your business online with the city.  
2. Contact the city directly to request that your deposit frequency be set to monthly by calling (303) 486-8299.
   • Gusto pays Greenwood Village OPT taxes monthly, the most frequent schedule, in an effort to minimize potential penalty or interest.

Let Gusto know how many business owners you have that are not considered employees, but are responsible for paying Greenwood Village OPT:

1. Head to the Taxes & compliance section and select Tax Setup.
2. Scroll to "Colorado Tax Setup" headline and click Manage taxes.
3. Edit the applicable field to tell us how many owners are subject to the tax. 

Enter the tax account information in Gusto

Once a valid local address has been added in Gusto for one or more employee(s), you can add your tax account information:

1. Click the Taxes & compliance section and select Tax setup.
2. Scroll to the "Colorado Tax Setup" headline and select Manage taxes.
3. Enter the applicable account number.

All Colorado employers with 1 or more qualifying employees must register for a FAMLI account, regardless of whether they are required to pay the employer portion of this tax. 

This is because all CO employers must remit payments on behalf of their employees.

If you offer your employees an equivalent private plan, you must apply for the private plan approval with the FAMLI Division. In the case your plan is approved, contact Gusto to let us know you’ve received approval from FAMLI to use your equivalent plan. 

Note that Colorado is not expecting to approve exemptions until Q3 2023. Gusto will continue withholding until these exemptions can be placed.

To get an overview of the process, see the step-by-step instructions in this video. Then:

1. Register for a FAMLI account with My FAMLI+ Employer.
2. Click Log into My FAMLI+ Employer.
   • You'll be redirected to this website. 
3. Next to "Are you a new user?", click Create account. 
4. On the new page you're taken to, scroll down and click the Create an account button.
   • Add your details, and we always recommend opting in to 2-factor authentication.
   • Once you've created the account, you'll be brought to the CO My+ FAMLI page.
5. From the My+ FAMLI page, click Add or link an organization.
   • Answer No when asked "Are you a third party administer registering on behalf of this organization?"
     • When asked "What organization type best describes the business you are registering", do not select "Third-Party Administer" or "Transmitter".
   • Search your company's FEIN—if you aren't already registered, proceed to the next step.
6. Fill out your company details to create a My FAMLI+ account—use your company's FEIN to register the business and link the two accounts.
7. After you've registered for both accounts, you'll need to authorize Gusto as your third-party agent for CO FAMLI so we can file and pay this tax.

When you register, you'll receive your new 10-digit FAMLI account ID number directly in the MyFAMLI+ portal.

Colorado employers are only required to pay the employer portion of FAMLI if they have 10 or more employees nationwide in the previous calendar year. You must determine your employee headcount each year by looking at the previous calendar year.

Here’s a summary of the requirements:

Self-employed people or owner-only companies with no employees:

• You're not required to participate in FAMLI, but you may choose to do so in the future. Learn more about self-employed participation in FAMLI. 
• The agency has shared that they will not be accepting payments for this subset of companies in 2023. Therefore, let us know if you fall into this group so we can mark you as exempt. 
  • On the Help page of your account, search for “Help with exemptions” to see your options to contact us.

Businesses with 2- 9 employees nationwide:

• You do not have to pay the employer portion.  
• You must still register with FAMLI in order to remit employee contributions. 
• Your Colorado employees must pay the employee portion: 0.45% of their wages, until they meet the Social Security wage base amount. 

Businesses with 10 or more employees nationwide:

• You must pay the employer portion: 0.45% of each Colorado employee’s wages.
• Your Colorado employees must pay the employee portion: 0.45% of their wages, until they meet the Social Security wage base amount.
  • For example: If you have 100 employees nationwide, and 9 working completely in Colorado, you pay the 0.45% employer's share and withhold and remit the 0.45% employee's share for each of those 9 employees.

Employers only need to pay premiums for employees who are localized in Colorado. A Colorado employee is someone who performs their work entirely in Colorado and whose work is subject to Colorado State Unemployment tax. More information regarding localization can be found in the FAMLI Division's Premium Rules at 7 CCR 1107-1, Section 1.5.6.C.

More questions? Learn more in this FAMLI resource, where you can access the FAMLI toolkit for employers. You can also contact the agency by email at [email protected].

Employer and employee contributions are calculated as a percentage of wages.

• Employers contribute 0.45% of employee wages—see the participation requirements above to determine if you’re required to pay the employer portion. 
• Employees contribute 0.45% of their wages, until the social security wage base amount is surpassed.

For example: if an employee made $1,000 in wages, the employee would pay $4.50 and the employer would pay $4.50.

Let us know if you're liable for the employer portion of CO FAMLI

Once you’ve determined whether you're required to pay the employer portion of FAMLI (see above), let us know so we can pay and file your taxes accurately: 

1. Sign in to your Gusto account.
2. Head to the Taxes and compliance section and select Tax setup.
3. Scroll to the "Colorado Tax Setup" headline and click Manage taxes. 
4. Let us know if you're "Required to pay employer portion of FAMLI?".

Enter your CO FAMLI account number in Gusto

Click to enter your 10-digit account number.

Withholding tax account number

If you've run payroll in Colorado in the past, you can find your withholding tax account number on:

• Online agency portal
• Form DR 1094—quarterly returns

The number is an 8-digit number—some documentation includes trailing digits (e.g.,12345678-003-WTH). In Gusto, enter only the first 8 digits (12345678) and not the trailing digits (003-WTH).

If you're unsure of your account number, call the Colorado Department of Revenue at (303) 238-7378.

Withholding credit ID

In order for Gusto to electronically make payments on your behalf, Colorado requires a Withholding Credit ID number in addition to your withholding account number—Gusto uses the withholding account number entered in Gusto to obtain the Withholding Credit ID directly from the agency.

If we're unable to obtain the Withholding Credit ID for any reason, you'll need to call the agency at (303) 238-7378 to troubleshoot. Some common reasons we cannot obtain your number include:

• An incorrect withholding account number was entered in Gusto
• You haven't opened a withholding account under the number provided,
• The legal name provided does not match what is registered with the state.

You can find your unemployment account number and current tax rate in the MyUI Employer website.

The tax rate on the agency website will be displayed as a decimal, not as a percentage. When you enter it in Gusto, enter it as a percentage.

• Example: If the agency website says 0.0644, the rate should be entered as 6.44% in Gusto.

If you're unsure what your account number or rate is, call the agency at (800) 480-8299.

Once you’ve created a MyFAMLI+ account, can find your FAMLI account ID in two ways. 

Check your email for your account ID

After you create your MyFAMLI+ account, the agency will send you a confirmation email. This message should also contain your account ID. 

Sign into your MyFAMLI+ account to find your ID

1. Sign into your MyFAMLI+ account.
2. Click Manage accounts.
3. Your account ID will be listed under the “Account ID” column.

If you have employees working in one of the below locations, you or your employees may be liable for an Occupational Privilege Tax (OPT).

You can find your existing OPT account number(s) and deposit schedule(s) on notices you've received from the local agencies. You can also contact the agency directly:

• Aurora
  • (303) 739-7000
• Denver
  • [email protected]
• Glendale
  • (303) 759-1513
• Greenwood Village
  • (303) 486-8299
• Sheridan
  • (303) 762-2200

If you need to register for an OPT tax, click the Register a company with state and local agencies dropdown above in this article.

Troubleshoot local tax issues

The most common issue is usually related to the tax deposit schedule. Gusto pays OPT taxes monthly, the most frequent schedule, in an effort to minimize potential penalty or interest. If we've let you know of a tax deposit schedule difference, contact the applicable agency directly and request that your deposit frequency be set to monthly.

Some Colorado cities also require employers to pay OPT for business owners and officers who are not included on payroll. In your Gusto account, we'll ask you to include how many business owners/officers are not considered employees but are subject to OPT taxes—do not include owners or officers that you are paying wages.

Once a valid local address has been added in Gusto for one or more employee(s), you can add your tax account information:

1. Click the Taxes & compliance section and select Tax setup.
2. Scroll to the "Colorado Tax Setup" headline and select Manage taxes.
3. Enter the applicable account number(s) and rate(s).

1. Sign in to your MyFAMLI+ Employer account.
2. In the “Manage my account” section, select Manage Accounts.
3. In the “Account name” column of the table, select your company’s tax account (if you can’t find your account, use the “Search” box).
4. In the “Third Party Administrator” section (you’ll need to scroll down to find this section), select Add.
5. In the “TPA Account” section, enter the following info:
   • Select Account: Gusto, Inc. (FEIN ending 2850)
   • Start date: The first day of the quarter you’re authorizing Gusto to file and pay on your behalf in Colorado.
6. Select Save.
7. Confirm your info is correct and select Yes, add TPA.
8. Next, sign in to Gusto to let us know you've granted us access:
   • On your Home page under "Things to do," click Give Gusto access to your Colorado Family and Medical Leave Insurance account.
   • Click the checkbox to indicate you've completed the task in your tax account.
   • Click Submit. 

This agency requires you to make Gusto your third-party agent (TPA) before we can file and pay taxes on your behalf.

1. Sign in to your account through the Revenue Online portal.
2. In the top-right section of the page, click Manage my profile.
3. Click the More... tab.
4. Click Grant Third Party Access in the access tile.
5. You'll need the following info:
   • Gusto's login = [email protected]
   • Access level = ALL ACCESS
   • Access start date = enter the first day of the first quarter you have a check date in Gusto for.
     • Example: if your first check date in Gusto was on February 14, 2022, you'd enter the Q1 start date of 1/1/2022.

Having trouble making Gusto your third-party agent?

• Verify that you've added the withholding’ tax type to your account
• Make sure the following information entered into Gusto matches exactly what's on file with the CO DOR:
  • Official company name
  • Company address
  • FEIN - Federal Employment Identification Number
  • Withholding account number

If Gusto has trouble gaining the access we need, you'll need to call the CO DOR at (303) 238-7378 to troubleshoot and fix the issue.

The CO DOL requires that you make Gusto your third-party agent (TPA) before we can file and pay taxes on your behalf. Gusto is not able to add access on your behalf.

If you need help adding Gusto as a TPA to your account, check out the agency's instructions.

1. Sign in to your MyUI Employer+.
2. On the homepage, from the left-hand menu, click the Account Maintenance dropdown.
3. Click the Third Party Administrator (TPA) authorization link.
   • Note: On this screen, you can view any TPAs currently associated with your account, maintain/modify the existing TPAs, and add new TPAs. 
4. Scroll to the bottom of the page, and click New. 
5. On the “Assign Third Party Administrator (TPA)” page, enter Gusto's TPA ID: 500003429. 
6. Click Next. 
7. Under the “TPA Details” section, enter the “TPA Services Begin date”.
   • Note: The start dates must be at the beginning of a calendar quarter (January, April, July, or October).
   • The “TPA Services end date” is not required. 
8. Under the “Un-Assigned Roles” section, select the Assign all Edit/Submit roles option. 
9. Click save. 

Gusto should now have access the account. If you need to modify the TPA for any reason, you can click “Modify” under the “Third Party Administrator (TPA)" Information. 

This agency requires you to make Gusto your third-party agent (TPA) before we can file and pay taxes on your behalf.

1. Sign in to your account through the Aurora Tax Portal.
2. From the home screen, select the Settings button. 
3. Under the “I Want To” menu, click Third party access and select Grant Access to a Third Party to continue.
4. This will open an "Add Third-Party Login" screen—use this to enter "zenpayroll'' as the username.
5. Select Yes on the "Include" column for tax type "Occupational Privilege Tax"—this allows us to file and pay on your behalf.
6. Click Next, and then Submit when finished.