Colo. Code Regs. 39-21-103(1)
Current through Register Vol. 47, No. 23, December 10, 2024
Rule 39-21-103(1) - Priority of Payments(1) Payments received by the Department shall be applied to a taxpayer's liabilities in accordance with the following rules: (a) A taxpayer can designate how a payment is to be applied to a liability owed to the Department only by remitting payment with the appropriate Departmental form (e.g., tax return, voucher, coupon, or, if an electronic payment, in conformity with paragraph (4) of this rule). Such payment shall be applied to the type of tax, fee, or charge for which the form is filed and for the period covered by the form in the order set forth below. A designation in a cover letter or a notation on a check will not designate the liability that will be paid and such payment will be applied as set forth in paragraph (1)(b). (i) Tax, fee, or charge owed to the state or a local jurisdiction (in proportion to the share of the debt owed to each).(ii) Related interest owed to the state or a local jurisdiction (in proportion to the share of the debt owed to each).(iii) Related penalty owed to the state or a local jurisdiction (in proportion to the share of the debt owed to each).(iv) Any excess payment shall be applied in accordance with paragraph (1)(b) of this rule.(b) A payment remitted without an accompanying Departmental form shall be applied to the liability for the earliest debt recorded on the Department's systems in the order set forth below:(i) With respect to any account for which a Statement of Account has been issued, oldest debt to newest debt and applicable interest and penalty owed to the state or a local jurisdiction (in proportion to the share of the debt owed to each). (ii) With respect to any account for which a Statement of Account has not been issued: (It will only be very rare circumstances in which a debt from multiple taxes and periods exist without a Statement of Account);(A) Any International Registration Plan and applicable interest and penalty owed to the state.(B) Any sales tax and applicable interest and penalty owed to the state or a local jurisdiction (in proportion to the share of the debt owed to each).(C) Any other tax, oldest to newest, that is owed to the Department and applicable interest and penalty owed to the state or local jurisdiction (in proportion to the share of the debt owed to each).(iii) In any event after all other liabilities have been satisfied, any existing payment plan.(c) This rule applies to taxes on income, sales/use, liquor, cigarette, other tobacco products, gas and special fuels, and severance, as well as periodic wage and severance tax withholding statements, estimated tax statements, annual reconciliation statements, and any other tax, fee, or and charge administered by the Division of Taxation of the Department of Revenue.(d) The Department rejects any provision on a check, cover letter accompanying a check, or any other document submitted to the Department by or on behalf of the taxpayer, except as specifically agreed to by the Department, that purports to be an accord and satisfaction of any liabilities owed by the taxpayer to the Department upon the presentment of the check to a bank for payment. Notwithstanding this rejection, the Department is authorized to and will present for payment any form of payment remitted.(2) Payments made by the Department for liabilities owed to a taxpayer, including tax refunds, shall be applied in the following order: (a) Offset of liabilities owed to the Department, paid in the order set forth in paragraph (1) of this rule pursuant to § 39-21-108(3), C.R.S.(b) Offset of other liabilities owed by taxpayer pursuant § 39-21-108(3), C.R.S.(c) Offset of federal Internal Revenue Service liens and levies.(d) Payment of garnishments and other court orders for debt collection duly served on the Department.(e) Refund of any tax, fee or charge due to taxpayer.(f) Related interest on refund due.(g) Related penalty due to taxpayer pursuant to § 39-22-622(3), C.R.S.(3) Any payment received, or a refund made, by the Department shall be applied, as described in paragraphs (1) and (2) above, only to a taxpayer's obligation, if any, on which a final determination has been made.(4) Accepted electronic payments include Automated Clearing House (ACH) or Electronic Funds Transfer (EFT). Payments made by ACH may designate to what liability and period the payment shall be applied by making such payment when filing a return, by including a TXP addenda record, or by including a TPP addenda record with such payment. Payments made by EFT are required to designate to what liability and period the payment shall be applied by submitting the required information when making such payment.(5) The Department does not accept a wire transfer of funds unless such wire transfer is pre-approved by the Department. A wire transfer does not include a transfer by ACH or EFT.(6) "Tax, fee, or charge" means any tax, fee or charge administered by the Department pursuant to § 39-21-102, C.R.S.(7) A taxpayer includes both the primary and secondary individual listed on a joint return. In the case of a secondary taxpayer that has filed a request pursuant to § 39-21-108(3)(a)(I)(A), C.R.S., any refund paid to the taxpayer shall be divided pursuant to § 39-21-108(3)(a)(I)(A), C.R.S.38 CR 03, February 10, 2015, effective 3/2/201540 CR 22, November 25, 2017, effective 1/1/201841 CR 14, July 25, 2018, effective 8/14/201841 CR 20, October 25, 2018, effective 11/14/201842 CR 05, March 10, 2019, effective 3/30/201944 CR 05, March 10, 2021, effective 3/30/202146 CR 03, February 10, 2022, effective 3/2/202346 CR 06, March 25, 2023, effective 4/14/2023