Colorado starts from your federal taxable income rather than building its own, which means the full federal standard deduction carries straight through — worth more than most states' own allowances.
| Gross pay | — |
| Federal income tax | — |
| Social Security6.2% up to $184,500 | — |
| Medicare1.45%, no cap | — |
| State income tax | — |
| 401(k) contribution | — |
| Health and HSA | — |
Useful if you are comparing a job that pays monthly against one that pays every two weeks, or working out what a raise is worth per paycheck.
| Pay schedule | Gross | Take-home |
|---|
Most states begin from federal adjusted gross income and then apply their own deduction. Colorado begins from federal taxable income — after the federal standard deduction has already been taken.
The practical effect is that a single filer gets the full $16,100 and a couple $32,200 removed before Colorado's 4.4% applies. Among flat-tax states only Iowa, Montana and a handful of others are as generous, and it makes Colorado's effective rate noticeably lower than the headline for modest incomes. At $60,000 a single filer is taxed on $43,900, giving an effective state rate near 3.2%.
Colorado's Taxpayer's Bill of Rights is a constitutional amendment limiting how much revenue the state can keep. Any increase in tax rates requires direct voter approval, and revenue collected above the TABOR cap must be refunded to taxpayers.
Those refunds are sometimes delivered as a temporary reduction in the income tax rate for a given year, which is why Colorado's rate has appeared as 4.4%, 4.25% and 4.55% in different sources covering different years. None of those are errors; they reflect TABOR mechanics rather than legislative changes.
For planning purposes, treat 4.4% as the statutory rate and any dip as a one-year refund you may or may not receive. Check the current year's rate before filing rather than assuming last year's figure carries over.
Colorado has no local income tax in the ordinary sense — no city takes a percentage of your wages. But several, including Denver, Aurora, Glendale, Greenwood Village and Sheridan, levy an occupational privilege tax, often called a head tax.
It is a small flat dollar amount per month rather than a percentage, charged to employees who earn above a low monthly threshold in that city, with a matching employer portion. Denver's is a few dollars a month.
It is trivial in amount but it will appear on your stub as a line you did not expect, and it is why your Denver paycheck may be a few dollars under the figure shown here.
Colorado allows a substantial subtraction for pension and annuity income, with a larger amount available from age 65. Social Security benefits are included within that subtraction rather than exempted separately, and taxpayers 65 and over can generally subtract the full amount of their Social Security income.
TABOR. Surplus revenue above the constitutional cap is refunded, sometimes as a temporary rate reduction for a single year. The statutory rate is 4.4%; dips below it are refunds, not permanent changes.
Yes. Colorado starts from federal taxable income, so the full federal standard deduction — $16,100 single, $32,200 joint — carries through before the 4.4% applies.
An occupational privilege tax of a few dollars a month charged to employees earning above a low threshold in the city, with a matching employer share. It is a flat amount, not a percentage of wages.
Taxpayers 65 and over can generally subtract their Social Security income in full. Younger recipients fall under the broader pension and annuity subtraction, which is capped.