State of Colorado

Colorado Utility Sales Tax Exemption

Colorado exempts the sale and use of utility used for the following purposes: processing, manufacturing, mining (including oil and gas exploration and production), refining, irrigation, construction, telegraph, telephone and radio communication, street and railroad transportation services, and all industrial uses. Residential utility usage is also exempt from sales tax.

Colorado Sales Tax Exemption Certificate

The DR-1666, DR-1465, and DR-1260 Exemption Certificates are the documents that must be filed in Colorado in order for a business to claim the Utility Sales Tax Exemption.

Energy Study Requirement

In Colorado, a detailed energy study must be performed to identify the exact percentage of utility that is exempt from sales tax. This includes calculating the annual consumption for each device that is consuming the utility and then distinguishing between production devices and non-production devices.

Our Process
01. Discovery

SmartSave investigates client’s current utility situation, and quickly identifies if the company is eligible to save on its utility sales tax through the exemption.

02. Energy Study

A SmartSave energy specialist performs an in-depth study at the business location to determine the exact proportion of energy use that is exempt from taxation.

03. Request

All necessary information is compiled into a report and submitted to the required utility companies and state agencies. SmartSave works hand-in-hand with these entities to ensure that all reports are accurate and compliant with statute.

04. Certification

Once the exemption request is approved, your company receives a refund on the past 2-4 years of overpaid utility sales tax, and stops paying sales tax on all certified production items, generating significant savings for the business each month moving forward.

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