All about taxes in Colorado Springs! Colorado Springs is considered a very low tax area of the country to live, especially compared to other major cities. Our taxes are paid in several pieces:
- State Income Taxes – The state income tax rate is 4.63% for 2018. It is primarily based on your Federal taxable income, so the state tax form is very simple to complete. Pretty much anything that is deductible for Federal taxes is also deductible for state purposes. For more information see the Colorado Deparment of Revenue web site.
- Sales Taxes – In the Colorado Springs area, sales tax is 8.25%.
- Property Taxes – Property taxes vary a lot based on where you live. Property taxes are the main source of revenue for schools in Colorado. GENERALLY, we plan for property taxes to be roughly 0.75% of the market value of the home. This is higher in certain areas where Special Improvement districts exist (such as Flying Horse Ranch, where the planning figure is closer to 1.25%) and lower in some of the older sections of the city (particularly in school district 11), where the figure is often closer to 0.5%. Because valuation is not precise and tax rates vary significantly, the only way to know for sure what taxes will look like is to check the assessors office information for a specific property.
Colorado enacted something called the Taxpayers Bill of Rights (TABOR) in 1992 that severely limits the ability of government at any level to raise taxes without taxpayers voting on it. TABOR has forced a significant level of discipline into local government spending, although it has also forced some very difficult decisions during hard economic times. Essentially, voters must approve all tax increases and the bill provides a cap on the amount of revenue that can be retained and spent.