Get CO DoR DR0021 Booklet 2020-2023

Booklet Includes Book 07/02/18 DR 0021 Colorado Severance Tax Booklet This book includes Oil and Gas Severance Tax Return Oil and Gas Severance Tax Computation Schedule Application for Extension of Time to File Colorado Severance Tax Return MAIL COLORADO SEVERANCE TAX RETURNS AND TAX PAYMENTS TO COLORADO DEPARTMENT OF REVENUE Denver CO 80261-0006 Page 2 General Information natural resources that are removed from the earth in Colorado. The tax is calculated on the gross income from oil and gas and carbon dioxide production* Who Must File Return DR 0021 Anyone who receives taxable income from oil or gas produced in Colorado. If you are a producer or own a working interest or a royalty interest in any oil or gas including carbon dioxide produced in Colorado or if you receive royalties on Colorado oil shale you must pay severance tax to the State of Colorado. Severance tax might be due even though you do not realize a net profit on your investment. A limited partnership LLC or S Corporation must file at the entity level* Partners members or shareholders do not file a severance tax return to report oil and gas income received by the pass-through entity. A General Partnership will not file at the entity level* Each partner and not the general partnership is required to file a return* Oil and gas production from stripper wells is exempt from severance tax. This includes oil from a well that produces 15 barrels or less of crude oil per day or gas from a well that produces 90 000 cubic feet or less of gas per day for the average of all producing days during the taxable year. Each commodity must be tested for each well to determine that commodity s stripper well status. More information about stripper well withholding and filing requirements can be found at Colorado. gov/Tax by reading FYI Withholding 4 and FYI General 4. Exception It is not necessary to file a severance tax return if you meet both of the following conditions 1. the total gross oil and gas withholding on form s DR 0021W for the calendar year is less than 250 and 2. the producer has withheld sufficiently from royalty or production payments to cover the severance tax liability. Severance Withholding Producers or first purchasers who disburse funds must withhold 1 of the gross income for each interest owner. This can include royalty working interest or any other interest owner. The producer or first purchaser is required to send the DR 0021W Oil and Gas Withholding Statement to interest owners by March 1 of each year. This form lists the gross income and the amount of severance tax the producer has withheld and paid to the state from your royalty or production payments. If you own an interest in more than one well or field you should receive a separate withholding statement from each producer or first purchaser. A copy of each withholding statement must be attached to your severance tax return DR 0021. ad valorem taxes if any on the withholding statement. Ad valorem taxes are paid by the producer to local governments cities and counties. You are allowed a credit against severance tax of 87.