Before you start

An SSN or ITIN
Form W-4 with your employer for federal withholding
Colorado Form DR 0004, only if you want to adjust state withholding
Records of foreign income and foreign financial accounts

Step-by-step

1
Complete the W-4 on day one
Colorado withholding derives from your federal W-4 unless you file a DR 0004 to adjust it, so there is only one form to get right. Getting the federal one wrong is still the commonest cause of an April surprise.
Via employerWho: YouFirst week of employment
2
Determine your US tax residency
The substantial presence test counts weighted days over three years to decide whether the US taxes your worldwide income or only US-source income. Your visa category does not decide this.
OnlineWho: You
3
Check for an applicable tax treaty
The US has treaties with around 70 countries that can reduce or exempt tax on particular income. Colorado starts from federal taxable income, so a federal treaty exclusion generally flows through to the state return — unlike California, which ignores treaties entirely.
OnlineWho: You
4
File federal and Colorado returns by 15 April
The tax year is the calendar year. Colorado grants an automatic six-month extension to file — no form to submit — but interest still runs on tax paid after 15 April, and you must pay 90% of the liability by then to avoid late-payment penalties.
OnlineWho: YouBy 15 April annually
5
Claim your TABOR refund by filing
When state revenue exceeds the constitutional cap, Colorado returns the surplus — as a sales tax refund claimed on the state return, and in some years as a temporary income tax rate reduction. You must file to receive it, which catches people who owe nothing and therefore skip the return.
OnlineWho: You
6
File an FBAR if foreign accounts exceed $10,000
Aggregate foreign account balances over $10,000 at any point in the year trigger a FinCEN filing, separate from and additional to your tax return.
OnlineWho: You

Documents you’ll need

Form W-2 from each employer, issued by 31 January
Form 1099s for freelance, interest and investment income
Passport and travel history for the substantial presence day count
Foreign account statements for FBAR reporting

Things most newcomers don’t know

Colorado Springs has no head tax, and Denver does.

Denver, Aurora, Glendale, Greenwood Village and Sheridan charge an occupational privilege tax — a small fixed monthly amount on employees earning above a threshold, matched by the employer, and payable by the self-employed on both halves. Colorado Springs levies nothing of the kind. It is a few dollars a month, but it is also one more registration a self-employed newcomer in Denver has to remember and one you do not.

Source: City of Colorado Springs — sales tax

You must file to receive a TABOR refund.

The Taxpayer's Bill of Rights caps state revenue growth and requires the surplus to be returned. Depending on the year that arrives as a sales tax refund on the state return, a temporary income tax rate reduction, or both. People who owe no Colorado tax sometimes skip filing entirely and forfeit money they were owed.

Source: Colorado Department of Revenue — TABOR

Colorado taxes 6.8% of your home's value, not 100% of it.

The assessment rate is set by the legislature and applied to actual market value before the mill levy; for 2026 the El Paso County Assessor puts residential at 6.8%, commercial at 25% and vacant land at 26%. That gearing is why Colorado's effective property tax rate is among the lowest in the United States, and why comparing a headline mill levy against another state's is meaningless.

Source: El Paso County Assessor — assessment rates

Colorado's treaty treatment is friendlier than California's.

Colorado computes state tax from federal taxable income, so income excluded federally under a treaty generally does not reappear on the state return. California explicitly does not follow federal treaties. For a researcher or engineer choosing between western states, that is a real difference in take-home pay.

Source: Colorado Department of Revenue — individual income tax

Common mistakes to avoid

Not filing a Colorado return in a year you owe nothing, and forfeiting a TABOR refund.
Assuming your visa type settles your tax residency.
Treating the automatic six-month extension as an extension to pay — it is not.
Missing the FBAR because a home-country account did not feel 'foreign'.
Comparing property tax mill levies across states without accounting for Colorado's 6.8% assessment rate.

Some of this may be out of date. Spotted something inaccurate? Help us keep it right for the next newcomer.

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