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Official Publication of the State Administrative Rules (24-4-103(11) C.R.S.)

Details of Tracking Number  2017-00144

CCR details

Tracking Number 2017-00144
Type of Filing Permanent Rule
Department 200 Department of Revenue
Agency 201 Taxpayer Service Division - Tax Group
CCR Number 1 CCR 201-2

Proposed rule

Notice Filed with SOS 04/12/2017
Rule ProposedRuleAttach2017-00144.doc
Additional Information AddInfoAttach2017-00144.doc
Statutory Authority The statutory basis for this rule is § 39-21-112(1), § 39-22-301, § 39-22-303, and § 39-22-305, C.R.S.
Description of Subjects/Issues The purpose of this amendment is to clarify how an affiliated group required to file a combined report or choosing to file a consolidated return shall apportion and allocate their income if the commercial activities of the affiliated group require the use of more than one apportionment methodology. There was no previous guidance in the rule as to how to combine two apportionment methodologies. The Department also included a conclusive presumption in the rule. This presumption states that a commercial activity is conclusively de minimis if the sum of the gross sales of that commercial activity that requires the use of a different apportionment methodology amounts to less than one percent of the taxpayer’s total gross sales. In such cases, the taxpayer must apportion the income from the de minimis activity in the same ratio that it apportions its gross sales pursuant to the sales factor for the remainder of the commercial activity. The Department also states that a commercial activity that requires the use of a different apportionment methodology may be de minimis if the gross sales of the commercial activity amounts to less than five percent of the taxpayer’s total gross sales.
Purpose/Objective of Rule see attachment
Basis And Purpose BasisAndPurposeAttachment2017-00144.doc
Submitted in response to issues raised by COLS/OLLS? No
Is this rule adopted in response to recent legislation? No
Hearing Date 05/17/2017
Hearing Time 09:00 AM
Hearing Location 1375 Sherman Rm 127
Contact Name Phil Horwitz
Contact Title Director, Tax Policy Analysis
Contact Telephone 303.205.8422
Contact email phillip.horwitz@state.co.us

Adopted rule

Adopted Rules AdoptedRules02017-00144.doc
Adopted Date 07/26/2017
AGO requested date 08/01/2017
Attorney General Opinion 08/14/2017
Colorado Register publication date 08/25/2017
Effective Date 09/14/2017
Inserted into CCR 09/13/2017