§ 39-22-108 — Credit for tax paid other states

Colorado § 39-22-108

• Jurisdiction: Colorado
• Title 39: Taxation
• Art.: Income Tax

Text

(1) With respect to all taxable
years commencing on or after January 1, 1987, the amount of taxes on federal
taxable income accrued to another state, the District of Columbia, or a territory or
possession of the United States, on income derived by a resident individual, estate,
or trust from sources in another state, the District of Columbia, or a territory or
possession of the United States, shall be allowed as a credit against the tax
computed under provisions of this article.

(2) The amount of credit taken under this section shall be subject to each of
the following limitations:

(a) The amount of the credit for taxes on the federal taxable income taxed by
another state, the District of Columbia, or a territory or possession of the United
States shall not exceed the same proportion of the tax against which such credit is
taken which the taxpayer's federal taxable income from the sources within such
state, the District of Columbia, or a territory or possession of the United States
bears to his entire federal taxable income for the same period;

(b) The total amount of the credit shall not exceed the same proportion of
the tax against which such credit is taken which the taxpayer's federal taxable
income from sources outside of Colorado bears to his entire federal taxable income
for the same taxable year; and

(c) Federal taxable income shall be deemed to be from sources in another
state in the same ratio as the modified federal adjusted gross income is from
sources in such state.

(3) If accrued taxes when paid differ from the amounts claimed as credits by
the taxpayer or if any tax paid is refunded in whole or in part, the taxpayer shall
notify the executive director, who shall redetermine the amount of tax due for the
years affected; the amount of tax, if any, found to be due upon such
redetermination shall be paid by the taxpayer upon notice and demand or the
amount of tax overpaid, if any, shall be credited or refunded to the taxpayer in
accordance with the provisions of section 39-21-108. In the case of such a tax
accrued but not paid, the executive director, as a condition precedent to the
allowance of a credit, may require the taxpayer to deposit a surety bond or other
security acceptable to the executive director in such amount as he may require,
conditioned upon the payment by the taxpayer of any amount of tax found to be
due upon any such redetermination.

(4) The credits provided for in this section, irrespective of the method of
accounting employed by the taxpayer in keeping his books, shall be taken in the
year in which the taxes of another state, the District of Columbia, or a territory or
possession of the United States accrue, subject to the conditions prescribed in
subsection (3) of this section.

(5) The credits provided by this section shall be allowed only if the taxpayer
furnishes to the executive director all information necessary for the verification and
computation of such credits as the executive director, by regulation, may prescribe.

Legislative History

Source: L. 87: Entire part R&RE, p. 1430, � 2, effective June 22. L. 88: (2)(a) and (2)(b) amended and (2)(c) added, p. 1313, � 4, effective May 29.