1 CCR 201-10
DEPARTMENT OF REVENUE SEVERANCE TAX 1 CCR 201-10 [Editor’s Notes follow the text of the rules at the end of this CCR Document.] _________________________________________________________________________ Rule 39-29-101. Materials Upon Which Severance Tax is Levied. Tax is levied on the severance from land in Colorado, regardless of whether or not a profit is derived, on the following materials:
(1) Metallic Minerals (2) Molybdenum (3) Oil and Gas (4) Coal (5) Oil Shale Rule 39-29-102(3)(a). Definition of “Gross Income” for Severance Tax on Oil and Gas. Basis and Purpose. The basis for this rule is §§ 39-21-112(1), 39-29-102(3)(a), and 39-29-102(7), C.R.S. The purpose of this rule is to provide, consistent with the Colorado Supreme Court’s ruling in BP Am. v. Colo. Dep’t of Revenue, clarification regarding gross lease revenues and the costs deductible therefrom in the calculation of gross income subject to severance tax on oil and gas.
(1) General Rule. For the purpose of severance tax imposed on oil and gas under article 29 of title 39, C.R.S., “Gross Income” is determined by deducting from Gross Lease Revenues any costs incurred by the Taxpayer for the Transportation, manufacturing, and Processing of Product between the Point of Taxable Valuation and the Point of Sale. Pursuant to § 39-29-114(1), C.R.S., persons who are members of the same controlled group of corporations shall be treated as one Taxpayer and the Gross Income therefor will be determined collectively. Use of the term “Taxpayer” in this rule refers collectively to all members of the same controlled group.
(2) Definitions. As used in this rule, unless context otherwise requires:
(a) “Department” means the Department of Revenue (b) “Entity” includes, but is not limited to, any corporation, limited liability company, partnership, estate, or trust.
(c) “Gross Lease Revenues” means all revenues from an oil and gas leasehold or freehold from the sale of any Product produced. “Gross Lease Revenues” includes the fair market value of any property acquired in exchange for Product. “Gross Lease Revenues” also includes the fair market value of any hydrocarbon gases used by the Taxpayer and includible in Gross Lease Revenues pursuant to paragraph (6)(a)(I) or (6)(b) of this rule.
(d) “Party” means any entity or individual.
(e) “Point of Sale” means the sales point or other point where the fair market value is established.
(f) “Point of Taxable Valuation” means the point at which the process to separate a bulk production stream into identifiable and measurable oil, gas, or free water begins or, in the case of gas that is not in need of initial separation, the point at which the gas is first identifiable and measurable. Oil, gas, or free water are identifiable and measurable if their respective volumes can be actually and separately identified and measured, whether or not the oil, gas, or free water, at such point, undergo actual identification and measurement. Oil, gas, and free water within a bulk production stream with respect to which separation has not yet begun are not identifiable and measurable, any estimation of their respective volumes notwithstanding.
(g) “Processing” means subjecting to a particular method, system, or treatment designed to effect a particular result. “Processing” includes, but is not limited to, mechanical separation, heating and treating, cooling, compression, dehydration, absorption, adsorption, refrigeration, flashing, sweetening, contaminant removal, cryogenic processing, and fractionation. “Processing” includes the separation of water from Product in a bulk production stream and the disposal thereof.
(h) “Product” means crude oil, condensate, coalbed methane, carbon dioxide, and natural gas, including hydrocarbon and nonhydrocarbon gases; except that Product does not include any oil, gas, or other commodity exempt from taxation under § 39-29-105(1)(b), C.R.S.
(i) “Related Parties” include:
(I) individuals related to one another as a spouse, parent, child, sibling, grandparent, grandchild, aunt, uncle, niece, nephew, or cousin, regardless of whether the relationship is by blood, marriage, adoption, or other means;
(II) two Parties, one holding an ownership interest in the other, either directly or indirectly, or an ownership interest of at least five percent in each being held by a third Party;
(III) in the case of a trust, the trust, its trustee, and its beneficiaries’;
(IV) in the case of an estate, the estate, its personal representative (or equivalent), its beneficiary/heir, and its executor/administrator.
(j) “Transportation” has the same meaning as in § 39-29-102(7), C.R.S.
(k) “Unrelated Party” is a Party that is not a Related Party.
(3) Determination of Gross Lease Revenues.
(a) Except as provided in paragraph (3)(b) of this rule, in the case of Product sold, the revenue from the sale is included in Gross Lease Revenues.
(b) If the Parties to a sale are Related Parties and the sales price is lower than the price for which the Product could have otherwise been sold to a ready, willing, and able buyer and where the Taxpayer was legally able to sell the Product to such a buyer, Gross Lease Revenues shall include the fair market value of the Product as determined by reference to comparable arm’s-length sales of like kind, quality, and quantity in the same field or area. The Department bears the burden of proof for demonstrating that the sales price for any sale of Product is lower than the price for which the Product could have otherwise been sold to a ready, willing, and able buyer and where the Taxpayer was legally able to sell the Product to such a buyer.
(c) In the case of hydrocarbon gases used by the Taxpayer pursuant to paragraphs (6)(a)(I) or (6)(b) of this rule, Gross Lease Revenues shall include the fair market value of the hydrocarbon gases as determined by reference to comparable arm’s-length sales of like kind, quality, and quantity in the same field or area.
(4) Deductions for Transportation, Manufacturing, and Processing Costs. In determining Gross Income, deduction from Gross Lease Revenues is allowed, as prescribed in this paragraph (4), for costs borne by the Taxpayer for Transportation, manufacturing, and Processing of Product between the Point of Taxable Valuation and the Point of Sale.
(a) Direct Operating Costs. Deduction is allowed, as prescribed in this paragraph (4)(a), for direct operating costs borne by the Taxpayer for the Transportation, manufacturing, or (I) Equipment, Machinery, and Real Property Improvements. Deduction is allowed for the cost of equipment, machinery, and real property improvements used for Transportation, manufacturing, or Processing of Product. Deductible costs include, but are not limited to, the following costs to the extent that such costs are incurred for Transportation, manufacturing, or Processing:
(II) Materials and Supplies Costs. Deduction is allowed for the cost of materials and supplies used for Transportation, manufacturing, or Processing of Product. Deductible costs include, but are not limited to, the following costs to the extent that such costs are incurred for Transportation, manufacturing, or Processing:
(III) Labor Costs. Deduction is allowed for the cost of labor performed in the Transportation, manufacturing, or Processing of Product, including, but not limited to, salaries, wages, payroll taxes, worker’s compensation insurance, and benefits. Labor costs eligible for deduction include operating, monitoring, servicing, or repairing facilities, equipment, and machinery used for the Transportation, manufacturing, or Processing of Product. If an employee’s duties include both work in the Transportation, Manufacturing, or Processing of Product and in non-deductible activities such as those enumerated in paragraph (4)(d) of this rule, deduction is allowed only for that part of the employee’s labor that is in the Transportation, manufacturing, or Processing of Product.
(IV) General and Administrative Overhead Costs. Deduction is allowed for general and administrative overhead costs that are directly and unambiguously attributable to Transportation, manufacturing, or Processing of Product.
(V) General and Public Liability Insurance. Deduction is allowed for the cost of general and public liability insurance for Transportation, manufacturing, or (b) Depreciation and Cost of Capital. Deduction is allowed, as prescribed in this paragraph (4)(b), for depreciation and cost of capital for any investment the Taxpayer makes in capital assets used for Transportation, manufacturing, or Processing of Product. The depreciation and cost of capital deductions shall be calculated in the same manner as prescribed for Return of Investment (RofI) and Return on Investment (ROI), respectively, by the Property Tax Administrator for the valuation of lands and leaseholds producing oil and gas; except that no depreciation or cost of capital deduction is allowed for an investment in a capital asset not used in Transportation, manufacturing, or Processing as those terms are defined in this rule. The prescription by the Property Tax Administrator referenced in this paragraph (4)(b) is made in Assessor’s Reference Library, Volume 3, Chapter 6 (July 2017 revision).
(I) If a Taxpayer makes a capital investment eligible for deduction under paragraph (4)(b) of this rule and also uses such capital asset to transport, manufacture, or process oil and gas for other Parties in exchange for compensation, the deduction allowed under paragraph (4)(b) of this rule shall be reduced in proportion to the amount of oil and gas transported, manufactured, or processed using the capital asset for which the Taxpayer receives compensation divided by the total amount of oil and gas transported, manufactured, or processed using the capital asset.
(II) Assets partially depreciated as of the effective date of this rule shall be subject to the provisions of this rule and this paragraph (4)(b)(II).
(III) If a Taxpayer sells, transfers, or otherwise disposes of any asset for which the Taxpayer claimed a depreciation deduction in any prior tax year, the Taxpayer must make a depreciation adjustment as prescribed in this paragraph (4)(b)(III).
(IV) The Assessor’s Reference Library (ARL) materials incorporated by reference in this paragraph (4)(b) include only those versions that were in effect as of October 2017, and not later amendments to the incorporated material. These materials incorporated by reference are available for public inspection during regular business hours at the Colorado Department of Revenue, Office of Tax Policy Analysis, 1881 Pierce Street, Lakewood, CO 80214. Copies of these materials are also available for a reasonable charge from the source agency: Division of Property Taxation, 1313 Sherman St., Room 419, Denver, CO 80203, (303) 864- 7777, and are available online at https://drive.google.com/drive/folders/0B- vz6H4k4SESaU4zb0NzVksxWVE (c) Fees and Charges – Related and Unrelated Parties. Except as provided in paragraphs (4)(c)(I) and (II) of this rule, deduction is allowed for any fee, charge, or other amount the Taxpayer pays to a Related or Unrelated Party for the Transportation, manufacturing, or (I) If a Party pays any fee, charge, or other amount to a Related Party and the two Parties are treated as one Taxpayer pursuant to § 39-29-114(1), C.R.S., the fee, charge, or other amount shall be considered an intra-company transfer and, as a result, no deduction shall be allowed therefor. The Taxpayer may instead claim any deductions allowable under paragraphs (4)(a) and (4)(b) of this rule for costs incurred in the Transportation, manufacturing, and Processing of the Taxpayer’s Product.
(II) If the Taxpayer pays any fee, charge, or other amount to a Related Party that is not treated as one with the Taxpayer under § 39-29-114(1), C.R.S., for Transportation, manufacturing, or Processing, and the fee, charge, or other amount exceeds the fair market value for the Transportation, manufacturing, or Processing performed, the deduction allowed to the Taxpayer is the fair market value of the Transportation, manufacturing, or Processing performed as determined by reference to comparable, arm’s length transactions. In determining the fair market value of the Transportation, manufacturing, or Processing performed, the quantity and quality of the Product, the field or area in which the service was performed, and the terms and conditions of the contractual agreement must be considered in determining the comparability of transactions. The Department bears the burden of proof for demonstrating that the fee, charge, or other amount paid exceeds the fair market value of the Transportation, manufacturing, or Processing performed.
(d) Non-Deductible Costs. No deduction is allowed for costs that are not for the Transportation, manufacturing, or Processing of Product. No deduction is allowed for any cost incurred in relation to any oil, gas, or other commodity exempt from taxation under § 39-29-105(1)(b), C.R.S. Non-deductible costs include, but are not limited to:
(I) down-hole production and operating costs incurred to extract or move Product from the reservoir to the Point of Taxable Valuation, including:
(II) costs for any activities performed in relation to a bulk production stream prior to the Point of Taxable Valuation;
(III) legal costs, title opinions, and any other pre-drilling or pre-production costs;
(IV) work over, well-pulling, or well re-completion costs;
(V) theoretical or actual line losses or “shrinkage”;
(VI) property taxes on oil and gas leaseholds and lands;
(VII) oil and gas depletion allowances;
(VIII) general and administrative overhead costs that are not directly and unambiguously attributable to Transportation, manufacturing, or Processing of Product, such as headquarters personnel, telephone service, vehicle expenses, and office supplies;
(IX) marketing costs and costs incurred to sell Product;
(X) environmental compliance costs, including the cost of any environmental impact statement, related to oil and gas production prior to the Point of Taxable Valuation; and (XI) any costs for Transportation, manufacturing, or Processing Product not included in Gross Lease Revenues.
(XII) any costs incurred by the Taxpayer to perform Transportation, manufacturing, or Processing of Product for another Party that compensates the Taxpayer for such Transportation, manufacturing, or Processing.
(5) Limitation on Deductions.
(a) Transportation, manufacturing, and Processing costs must be determined and deducted on a well-by-well basis. If Product from multiple wells is collectively transported, manufactured, and processed, the costs of Transportation, manufacturing, and Processing must be allocated based upon pro rata sales from each well.
(I) If a Taxpayer performs Transportation, manufacturing, or Processing for another Party, no deduction is allowed for the cost of any Transportation, manufacturing, or Processing for which the Taxpayer receives compensation from the other Party.
(b) Deductions for Transportation, manufacturing, and Processing costs allocated and attributed to a well cannot exceed the Gross Lease Revenues derived from the well. No deduction is allowed for any cost incurred in relation to any oil, gas, or other commodity exempt from taxation under § 39-29-105(1)(b), C.R.S.
(c) Deduction is only allowed for costs substantiated by appropriate documentation. A Taxpayer must maintain records, made at the time any deductible cost was incurred, to demonstrate that the cost was for Transportation, manufacturing, or Processing of Product.
(6) Used Product.
(a) If a Taxpayer uses hydrocarbon gases it produces for Transportation, manufacturing, or Processing, the Taxpayer may elect to either:
(I) include in Gross Lease Revenues the fair market value of such hydrocarbon gases, as determined under paragraph (3)(c) of this rule, and claim deduction for such Product under paragraph (4) of this rule; or (II) exclude from Gross Lease Revenues the fair market value of such hydrocarbon gases, as determined under paragraph (3)(c) of this rule, and claim no deduction for such Product under paragraph (4) of this rule.
(b) If a Taxpayer uses hydrocarbon gases it produces for any purpose other than reinjection, Transportation, manufacturing, or Processing the Taxpayer shall include in Gross Lease Revenues the fair market value of such hydrocarbon gases, as determined under paragraph (3)(c) of this rule, and claim no deduction for such Product.
(I) If the Taxpayer does not, within the Taxpayer’s regular course of business, measure the volume of hydrocarbon gases used for nondeductible purposes and includible in Gross Lease Revenues pursuant to paragraph (3)(c) of this rule, the Taxpayer may use a reasonable method to estimate such volume. The Taxpayer must document the basis for such estimate and make such documentation available to the Department upon request.
Regulation 29-102(3)(b). [Repealed eff. 08/30/2014] Regulation 29-102(4). [Repealed eff. 08/30/2014] Regulation 29-102(5). [Repealed eff. 08/30/2014] Regulation 29-102(6). [Repealed eff. 08/30/2014] Rule 39-29-103.
(1) Tax levied. In addition to all other taxes, there is levied a tax upon the severance of all metallic minerals from the earth within this state. The tax is levied against every mining operation engaged in severance of metallic minerals. The owners and/or operators of the mining operation so engaged shall be deemed liable for the maintenance of records, filing required forms and payment of the tax.
(2) Taxation.
(a) For each taxable year, the tax is imposed at the rate of 2.25% of gross income. Such tax on gross income from the severance of metallic minerals is subject to an exemption of the first $19,000,000 of gross income, which need not be prorated for a taxable period of less than twelve months. This exemption is allowed for each mining operation, which shall consist of an area of land in which the recoverable metallic mineral reserves can be developed in an efficient, economical, and orderly manner as a unit with due regard to conservation of recoverable metallic mineral reserves and other resources. All lands in a mining operation shall be under the effective control of a single operator/lessee and be able to be developed and operated as a single operation. A single mining operation may include, but is not limited to, surface mining, underground and in situ mining, on-site concentrating, milling, evaporation, and other primary processing and transportation at or near the mine site.
(b) Ores severed prior to January 1, 1978 shall not be subject to these provisions. Where ores are processed and abandoned and subsequently reclaimed by an unrelated economic interest they shall be generally considered as waste or residue.
(c) The following case is cited to exemplify what is not considered to be waste or residue from previously processed ores:
Taxpayer's predecessor in interest dredge mined property for gold, aggregates were picked up by dredge, washed but not treated chemically or crushed, then dumped back unchanged on same land. Gold was in free state, not actually extracted from aggregates. Aggregates were natural deposits of minerals in place - not dumps or tailings. Commissioner of Internal Revenue v. Claude C. Wood Company, 321 F.2d 207, (9th Cir. 1963).
(3) Tax credit. All ad valorem tax determined on the basis of gross proceeds or net proceeds under Section 39-6-106, C.R.S. 1973, is allowed as a credit against the tax imposed in subsection (1) of this section. The ad valorem tax credit allowed may not exceed fifty percent of the metallic minerals severance tax imposed. The amount of ad valorem tax used to determine the credit shall be the amount assessed in the case of an accrual basis taxpayer during the taxable year or the amount paid by a cash basis taxpayer during a taxable year. In the case of a short period return including the return for the first taxable period the credit will be limited to an amount equal to the ad valorem tax assessed to an accrual basis taxpayer or paid by a cash basis taxpayer during the short period.
Rule 39-29-104–2. [Emergency rule expired 08/07/2020].
Regulation 29-105(1)(a). [Repealed eff. 08/30/2014] Regulation 29-105(1)(b). [Repealed eff. 08/30/2014] Rule 39-29-105-1. Liability for Severance Tax on Oil and Gas. Basis and Purpose. The statutory bases for this rule are sections 39-21-101(3), 39-21-112(1), 39-29- 101(1), 39-29-102(3), 39-29-105, 39-29-111, and 39-29-112, C.R.S. The purpose of this rule is to clarify the imposition of, and liability for, Colorado severance tax on oil and gas.
(1) Except as provided in paragraph (2) of this rule, the severance tax levied on oil and gas pursuant to section 39-29-105, C.R.S., shall be imposed on any person owning a working interest, royalty interest, a production payment, or any other interest in any oil or gas produced in Colorado. In the case of any interest owned by any partnership, S corporation, limited liability company, joint venture, or any other entity treated as a pass-through entity for federal income tax purposes, the severance tax on oil and gas is imposed on such entity and not on the partners, shareholders, or members of such entity.
(2) No severance tax shall be imposed pursuant to section 39-29-105, C.R.S., with respect to:
(a) any interest in oil and gas held by the United States of America;
(b) any interest in oil and gas held by the State of Colorado or any political subdivisions of the State of Colorado;
(c) any interest in oil and gas held by the Southern Ute Indian Tribe or the Mountain Ute Indian Tribe; or, (d) any production deemed exempt pursuant to section 39-29-105(1), C.R.S. Rule 39-29-105-2. Ad Valorem Tax Credit.
(1) The ad valorem tax credit is apportionable among related parties in proportion to each party's share of gross income. If such credit exceeds the tax on the severance of oil and gas, the excess amount does not create a right to a refund of severance tax or a credit against past or future severance tax liability.
(a) In the case of a short taxable period, the credit shall apply only if the ad valorem tax is assessed to an accrual basis taxpayer or paid by a cash basis taxpayer during such period. The credit applicable for one period may not be used in another period.
(2) The ad valorem tax paid on buildings, equipment and facilities shall not be used to compute the ad valorem tax credit.
(3) The ad valorem credit is allowed only if the well production is subject to severance tax in the year the ad valorem tax is paid or assessed.
(4) Taxpayers on a cash basis for oil or gas revenue and expense reporting for federal income tax purposes must claim ad valorem credits based on the date ad valorem taxes are paid to the county treasurer.
(5) Taxpayers on an accrual basis for oil and gas revenue and expense reporting for federal income tax purposes must claim ad valorem credits in the tax year that contains the accrual date for the ad valorem tax in the State of Colorado. The accrual date is the levy date of the ad valorem tax, which is January 1 of the calendar year following the year of production that is reported to the county assessor.
Regulation 29-105(2)(b). [Repealed eff. 08/30/2014] Regulation 29-105(2)(c). [Repealed eff. 08/30/2014] Rule 39-29-106. Coal.
Basis and Purpose. The bases for this rule are sections 39-21-112(1) and 39-29-106, C.R.S. The purpose of this rule is to clarify the imposition of the severance tax on coal, as well as exemptions, credits, and the tax rate therefor.
(1) Tax and Exemptions. In addition to all other taxes, there is levied a tax upon the severance of coal from the earth within this state. On and after July 1, 1999, but before January 1, 2026, the tax on coal is subject to an exemption provided in section 39-29-106(2), C.R.S. The exemption need not be prorated for taxable periods of less than a calendar quarter.
(2) Credits.
(a) For taxable years commencing prior to January 1, 2026, section 39-29-106(3.5) and (4), C.R.S., allows a credit for the production of lignitic coal.
(b) For taxable years commencing prior to January 1, 2026, section 39-29-106(3) and (3.5), C.R.S., allows a credit for coal produced from underground mines.
(3) Tax Rate. The rate of tax on coal shall be determined as follows:
(a) The basic rate shall be 36 cents per ton of coal.
(b) The rate shall be adjusted each quarter based upon changes in the Producer’s Price Index - All Commodities, (not seasonally adjusted) prepared by the U.S. Department of Labor, Bureau of Labor Statistics. Revisions to the Producer’s Price Index shall not result in a further adjustment to the coal tax rate for a given quarter.
(c) The adjustment shall be one percent of the basic rate for every full one and one-half percent change in the Producer’s Price Index over the base period of January 1978. Regulation 29-106(5). [Repealed effective 12/30/2007] Rule 39-29-107. [Repealed eff. 10/30/2025] Regulation 29-110(1)(d). [Repealed eff. 08/30/2014] Rule 39-29-111. Oil and Gas Severance Tax Withholding.
Basis and Purpose. The statutory bases for this rule are sections 39-21-101(3), 39-21-112(1), 39-29- 101(1), 39-29-111, 39-29-112, and 39-29-115(1.5), C.R.S. The purpose of this rule is to clarify requirements for withholding severance tax from gross income from oil and gas, to establish reporting requirements, and to clarify which taxpayer may claim credit for taxes withheld.
(1) Every producer or purchaser who disburses funds owed to any person owning a working interest, a royalty interest, a production payment, or any other interest in any oil or gas produced in Colorado shall withhold one percent (1%) of the gross income from such payments; except, no withholding shall be taken from payments for:
(a) Interests held by the United States of America;
(b) Interests held by the State of Colorado or any political subdivisions of the state of Colorado;
(c) Interests held by the Southern Ute Indian Tribe or the Mountain Ute Indian Tribe; or, (d) On or after January 1, 2000, any production exempt from the tax imposed by section 39- 29-105(1)(a) or (b), C.R.S.
(2) Producers and purchasers do not have to register wells with production exempt under section 39 29 105(1)(b), C.R.S. where the well American Petroleum Institute (API) number shows exempt levels of monthly production on the conservation levy records of the Colorado Oil and Gas Conservation Commission.
(3) Annual Report.
(a) Every producer or first purchaser required to provide a statement pursuant to section 39- 29-111(4), C.R.S., shall issue such statement using form DR 0021W, Oil and Gas Withholding Statement, and report on such form the amount of tax deducted and withheld pursuant to section 39-29-111, C.R.S., and the following amounts determined for the calendar year on both an accrual basis and a cash basis:
(i) Gross income;
(ii) Gross income attributable to production that is exempt from taxation pursuant to section 39-29-105(1), C.R.S.;
(iii) Ad valorem tax assessed or paid in accordance with section 39-29-105(2), C.R.S.; and (iv) Ad valorem tax assessed or paid in accordance with section 39-29-105(2), C.R.S., on oil and gas production that is exempt from taxation pursuant to section 39-29-105(1), C.R.S.
(b) On or before April 15 of each year, every producer or first purchaser shall file with the Department:
(i) a copy of each form DR 0021W, Oil and Gas Withholding Statement, required pursuant to section 39-29-111(4), C.R.S., and paragraph (3)(a) of this rule; and (ii) a form DR 0456, Annual Reconciliation of Oil and Gas Severance Withholding (c) A producer or first purchaser who fails to comply with the annual reporting requirements prescribed by paragraph (3)(b) of this rule shall be subject to the penalty imposed pursuant to section 39-29-115(1.5), C.R.S.
(4) Returns and Liability. The tax is imposed on the interest owner who shall file the severance tax return and pay the severance tax. The return shall reflect the amount listed on form DR 0021W, Oil and Gas Withholding Statement, received from the producer or first purchaser; the tax liability shall not be shifted onto another party. For example, a limited partnership, limited liability company, S Corporation, or joint venture must file at the entity level. Partners, members, or shareholders shall not file a severance tax return to report oil and gas income received by the pass-through entity. The interest owner is the person who receives income from the producer or first purchaser regardless of the person’s form of organization, including individual partnerships, limited liability companies, corporations, or joint ventures.
(5) The amount withheld pursuant to section 39-29-111, C.R.S., by the producer or first purchaser may be claimed as a credit by the interest owner of oil and gas or oil shale production when such party files a return as required under section 39-29-112, C.R.S.
(a) If the credit for the amount withheld exceeds the tax shown on the return, the excess credit shall be refunded to the royalty interest owner. Regulation 29-111(2). [Repealed eff. 08/30/2014] Rule 39-29-112–2. [Emergency rule expired 08/07/2020].
Rule 39-29-115. Penalty and Interest.
(1) Except as specified in paragraph (2) of this rule, the penalties for failure to file or to pay penalty described in §39-29-115(1), C.R.S. will not be due if a taxpayer files and pays the severance tax return within the extension period.
(2) Unless specifically waived by the Department for good cause, the failure to file or pay penalty described in §39-29-115(1), C.R.S. will be due if:
(a) the taxpayer has not paid at least ninety percent of the net tax liability into the Department of Revenue as of the original due date of the return, (b) the taxpayer does not file by the extension due date, or (c) the taxpayer does not pay all of the net tax due with the taxpayer's filed return.
(3) Interest will be assessed on any unpaid net tax liability, including a return filed under extension, for the period from the original due date until payment is made.
(4) Net tax liability means the total Colorado severance tax liability for the tax year reduced by all credits other than prepayment credits.
(5) Prepayment credits are credits for severance tax paid by the taxpayer (severance tax withheld and estimated tax) on or before the original due date of the return. _________________________________________________________________________ Editor’s Notes History Regulations 39-29-104, 39-29-106 eff. 4/30/2007.
Regulation 39-29-106 eff. 12/30/2007. Regulation 29-106(5) repealed eff. 12/30/2007. Regulations 39-29-101, 39-29-105, 39-29-106, 39-29-111 eff. 08/30/2014. Regulations 29-102(3)(b), 29- 102(4), 29-102(5), 29-102(6), 39-29-104, 29-105(1)(a), 29-105(1)(b), 29-105(2)(b), 29-105(2)(c), 29-110(1)(d), 29-111(2) repealed eff. 08/30/2014.
Rule 39-29-102(3)(a) emer. rule eff. 01/23/2017; expired 05/23/2017. Rule 39-29-102(3)(a) eff. 11/01/2017.
Rules 39-29-104-2, 39-29-112-2 emer. rules eff. 04/09/2020; expired 08/07/2020. Rules 39-29-105-1, 39-29-105-2, 39-29-111 eff. 12/30/2020. Rule 39-29-106 eff. 08/30/2023.
Rule 39-29-107 repealed eff. 10/30/2025.