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DR 0106EP (10/19/22)
COLORADO DEPARTMENT OF REVENUE
Denver CO 80261-0008
=DO=NOT=SEND= Tax.Colorado.gov
Colorado Pass-Through Entity Estimated Income Tax
Instructions
Taxpayers are required to make estimated payments being billed, see form DR 0204, Underpayment of
during the tax year if their Colorado income tax due will Individual Estimated Tax (composite filers) or form DR
exceed certain thresholds. This form is used for 0205, Underpayment of Corporate Estimated Tax (entities
partnerships and S corporations to make estimated making an election under the SALT Parity Act).
payments. Refunds
General Rule Estimated tax payments can only be claimed as
In most cases, a partnership or S corporation must pay prepayment credit on the 2023 Colorado income tax return.
estimated tax if it will file a composite return on behalf Therefore, estimated payments cannot be refunded until
of nonresident partners, and the Colorado income tax the 2023 Colorado income tax return is filed.
liability for any individual partner or shareholder per the
composite return will be more than $1,000 for 2023 SALT Parity Act Election
A partnership or S corporation may, on an annual basis,
A partnership or S corporation that elects to be subject elect to be subject to tax at the entity level under the SALT
to tax at the entity level under section 39-22-343, Parity Act (section 39-22-343, C.R.S.). This is a binding
C.R.S. is subject to the same requirement to remit election on the pass-through entity and all owners, and
quarterly estimated tax payments as C corporations. the election is irrevocable for the tax year. The election
In general, an electing entity will pay estimated tax if can be made during the tax year on this form DR 0106EP,
its Colorado income tax liability will exceed $5,000 for or on the Colorado income tax return (DR 0106) when it
2023. is filed after the close of the tax year. Mark this box only
Required Payments if the partnership or S corporation is making the election
In general, payments are required quarterly, and the under the SALT Parity Act for this tax year. This election
amount due is 25% of the required annual payment. The cannot be revoked for this tax year once it is made. A
required annual payment is generally 70% of the actual partnership or S corporation may make required estimated
net Colorado tax liability for the current year, or 100% of payments before making an election under the SALT
the actual net Colorado tax liability for the preceding year Parity Act.
(whichever is less). For more information on calculating
estimated payment for nonresident partners and Go Green with Revenue Online
shareholders included in a composite return, please see Colorado.gov/RevenueOnline allows taxpayers to file
the Individual Income Tax Guide. taxes, remit payments and monitor their tax accounts.
Please see the Corporate Income Tax guide if the DR 0106EP is not required to be sent if electronic
payment is remitted through this site. Please be advised
partnership or S corporation intends to make an
that a nominal processing fee may apply to electronic
election under the SALT Parity Act. payments.
Calculating the Payment
Pay by Electronic Funds Transfer (EFT)
Estimated tax payments must be made on a quarterly
EFT payments can be made safely, for free, and can be
basis. scheduled up to 12 months ahead of time to avoid
Payments and forms should be submitted using the same forgetting to make a quarterly payment. This requires
account number as will be used on the Colorado pre-registration before payments can be made.
Partnership and S Corporation and Composite Nonresident Visit Tax.Colorado.gov/electronic-funds-transfer for
Income Tax Return (DR 0106). If, for any reason, the registration information.
account numbers are inconsistent, the Department must be
notified in writing prior to filing the DR 0106. Mail this
notification to: Additional information, guidance publications and forms are
available at Tax.Colorado.gov, or you can call
Colorado Department of Revenue
303-238-SERV (7378) for assistance.
Denver, CO 80261-0008
Penalties
Failure to timely remit estimated tax will result in an
estimated tax penalty. An estimated tax penalty will also be
calculated for each missed or underpaid payment.
For calculation specifics, or to remit this penalty before
