With online rental sites like VRBO, more people are renting their homes, and most are not collecting and remitting the associated sales taxes. States are feeling the impact and starting to fight back, levying fines, interest, and tax burdens on owners who are not collecting and remitting these taxes, and Pitkin, Eagle, and Gunnison Counties have begun to crack down.
The Marble Crystal River Chamber recognizes this will affect a number of home owners on this side of the mountain, and feels there is a responsibility to inform and educate the short-term rental community on their responsibilities in complying with state sales and lodging tax laws. Attached is general information about how to apply for a license and remit the taxes. Information can also be accessed online at www.TaxColorado.com. Keep in mind, it is the visitor, and not you, who actually pays these taxes, but you are liable for collecting and remitting these taxes to the state. If these amounts are not added to rents, the State will assume the rate includes these amounts, and will deduct them from your rental rate.
Anyone who has made a short-term vacation-rental (30 days or less) in this area has most likely benefitted from the lodging tax (referred to as the Local Marketing District Tax or LMDT). The Marble Crystal River Chamber (MCRC) and Gunnison County Tourism Association use these funds to promote the Upper Crystal River Valley as a destination, which, in turn, drives potential visitors to your short-term rental property listing.
In addition, we encourage you to join the Chamber. This will not only give you a voice, and address concerns and questions, but will make the Marble Crystal River Chamber a stronger advocate for your lodging endeavors moving forward. We want to hear from you, and what sort of renters you are looking for. Do you need help with managing or cleaning your rental? With enough interest from the private- rental sector, the Chamber might be able to help with such needs
Whether you decide to join the Chamber or not, we welcome your questions and offer our help in understanding the Local Marketing District Tax and your associated responsibility.
INFORMATION ON COLLECTING AND REMITTING STATE SALES TAX AND GUNNISON COUNTY’S LOCAL MARKETING DISTRICT TAX
Below is a general overview of Colorado State Sales Tax registration, collection, and remittance. We encourage you to consult the Colorado Department of Revenue’s Sales Tax Guidelines. These can be found on their web site, www.taxcolorado.com. The Department of Revenue also offers free sales tax classes online or in person. Visit www.TaxSeminars.state.co.us for updated listings of sales tax classes.
There are 2 separate Sales Tax forms that you are required to file for short term lodging (less than 30 days). Both are remitted to the Colorado Department of Revenue.
1. State and Local Sales Tax (Form DR0100)
2. Local Marketing District Tax (Form DR1490)
When filling in the ‘Local Marketing District Tax’ form. The Location / Juris Code is 400042 if you are in the town of Marble or 400206 if you are in Unincorporated Gunnison County [not in the town of Marble].
Who must collect and remit sales tax?
Any Person or business selling retail goods, meals, food, short term lodging (30 days or less), and other goods as detailed on the Colorado Department of Revenue web site, www.taxcolorado.com. Online listing services like VRBO and AIRBNB DO NOT pay this tax for you.
Who needs a sales tax license?
Any business or individual selling goods or short term lodging services (including camping) is required to have a State Sales Tax License. Some different reporting options exist for individuals collecting less than $1,000 annually, but these rules do not exempt anyone from paying the tax. Please consult the Department of Revenue web site for more information.
How do I get a sales tax license?
Apply for a state sales tax license online at www.Colorado.gov/cbe and receive your Colorado Account Number immediately. If you cannot apply online, you may complete and mail in the Sales Tax/Withholding Account Application (Form CR0100). You will receive your license and account number by mail in about four to six weeks. This form can be downloaded at www.taxcolorado.com, or ordered by phone at (303)238-7378.
If you are an individual, you can register using your social security number. If you are a business or an individual preferring to report the income under a business name, first register your business name with the Colorado Secretary of State at www.sos.state.us, and apply for a Federal ID number with the IRS at www.irs.gov (form SS-4).
What are the different types of Sales Tax Licenses (refer to www.taxcolorado.com for specific information)?
· STANDARD SALES TAX LICENSE (most common)
· SPECIAL EVENTS SALES TAX LICENSE
What are the Sales Tax rates in our area?
· 5.9% for non-lodging sales within the town limits of Marble.
· 3.9% for non-lodging sales within Gunnison County, but outside the town limits of Marble.
· 11.9% Tax (5.9% State Sales Tax plus a 4% Local Marketing District Tax) for short term lodging sales within the town limits of Marble.
· 7.9% Tax (3.9% Sales Tax plus a 4% Local Marketing District Tax) for short term lodging sales within Gunnison County, but outside the town limits of Marble.
When are Sales Tax returns filed and what form must be filed?
Filing frequency depends on sales volume. Typically if you anticipate sales of $10,000 or more in a month, you must file all returns monthly. If you anticipate sales of less than $10,000 per month, you may file quarterly. If you collect less than $15 a month on average, you may request to file annually.
Monthly returns are due by the 20th of the month following the reporting month. Quarterly returns are due the 20th of the month following the reporting quarter. Annual returns are due by January 20. If a due date falls on a Saturday, Sunday or holiday, the return is due on the next business day.
Sales are reported on Form DR 0100. Short term lodging sales require additional reporting on Local Marketing District Tax Form DR 1490. Required filing dates are the same for both returns.
Returns can be mailed in or processed online.
Even if no sales were made and no taxes were collected during a filing period, you must still file a Sales Tax Return(s).
What if I do not pay the tax?
The State assesses penalties and interest on all outstanding and late Sales and Marketing taxes.