Colorado Tax Audits

Colorado is a “piggy-back” state for income tax purposes, meaning that Colorado tax is determined by a taxpayer’s federal taxable income. Consequently, Colorado Department of Revenue (CDOR) income tax return audits of individuals are pretty rare. Much more frequently, CDOR will assert that a non-resident is really a resident for tax purposes, though, which forces the taxpayer to prove the negative: “No, I was neither a resident, nor was I domiciled, in Colorado that year.”

In this situation, the taxpayer will have to gather as much documentation as possible to show that he or she had minimal, if any, ties to Colorado, and therefore is not subject to Colorado income tax. The taxpayer will have to prove that he or she was not “domiciled” in Colorado for the year under audit. It is a very fact-intensive analysis, and frequently leads to litigation in Colorado District Court.

Detailed examinations or audits can take weeks or months to complete, and front-line Revenue Agents are not inclined to accept excuses or the lack of substantiation. They are inclined and instructed to go by the book.

Regardless, David A. Sprecace, P.C. can provide peace of mind that you will not have to endure an examination alone, but with a tax attorney of more than 23 years’ experience. Call 303-454-8260 or email Dave at to set up a phone consultation.


Colorado Office
600 17th St #2800s

Denver, CO 80202

Client Reviews

Dave has ridden to our rescue on many occasions. It’s not that I try to get in trouble but Dave is always there to bail me out. Dave went toe-to-toe with the IRS over a several year legal battle. Nothing like having a...

- Russell and Lisa P.

My business partner and I hired Dave to represent us with an IRS tax audit of our company and individual tax returns. There were other family members and other businesses involved, and the IRS initially wanted more than...

- Mark M.

I called Dave to help me file several years of income tax returns. After the returns were filed, Dave filed an Offer in Compromise to get rid of the old taxes. The IRS accepted a small fraction of the original amount...

- Mike W.

When I needed to buy out my business partner, Dave told me of the possible pitfalls with the Operating Agreement, walked me through the entire process, helped me value the company, and make an offer. I was able to keep...

- Yvonne A.

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