The place to find business sales tax information

— as well as solutions, services and jobs!

Colorado Statute of Limitations: Watch Dates in Home Rule Cities

author photo of Keith Crichton

Article XX, Section 6 of the Colorado Constitution grants a great deal of authority to the state’s Home Rule cities. However the legislature determined “that the enforcement of sales and use taxes can affect persons and entities across the jurisdictional boundaries of taxing jurisdictions and that dispute resolution is a matter of statewide concern…” C.R.S. 29-2-106.1(1)

Generally the Statute of Limitations for sales and use taxes is three years from the date on which the tax was due. C.R.S. 39-26-125 and 39-26-210 However, the letters sent out by many Colorado Home Rule cities which notify a taxpayer of a sales and use tax audit will specify a 36 month audit period that begins more than three years before the date when the audit is scheduled to begin. (For example, a letter dated July 15, 2014 notifying “Taxpayer X” of an audit which will begin on October 1, 2014, will say that it will cover the 36 month period from August 1, 2011 through August 31, 2014.) The cities take the position that the mailing of their notice suspends the Statute. Most taxpayers don’t know the difference, but there is nothing in the state statutes which provides for the suspension claimed by the cities. So by the time the audit starts, the first two months of the audit period in my example are already closed. Watch the dates carefully when dealing with Colorado cities!

In addition, some attorneys argue that a taxpayer should never agree to sign an extension of the Statute of Limitations. But that’s a subject for another time.

Keith Crichton, CPA is President of Crichton Consulting Services, LLC a specialty CPA firm located in Centennial, Colorado, a suburb of Denver. For the last 30 years he has been responsible for the corporate income/franchise, sales and use, property and other tax filings for all 50 states. He has been the tax manager of several multistate companies, including several equipment leasing companies and an international accounting and tax consulting company.

Comments or questions may be submitted by using the on-page "Comment" feature, subject to disclaimer at bottom of page. Additional contact options (and Consultation Requests) are also available on Keith's associated Firm Profile page.

Other recent “Local Sales Tax / Home Rule Issues” posts by Keith Crichton, CPA:

NOTE: All blog content, comments, and participation subject to disclaimer at bottom of page.


Note: Keith Crichton is no longer accepting new comments nor questions. While a new blogger will be taking over this category in the near future, please use the Site's SEARCH bar in the interim to locate other helpful information.

2 Responses to Colorado Statute of Limitations: Watch Dates in Home Rule Cities

  • Posted by Jeff on January 21, 2016 1:16pm:

    It appears the City of Aurora has found a way around this issue by including in their code a rule that mailing a notice extends the statute of limitations until they are done with the audit. Code Section 130-90(c). Do you know if this has been challenged in court?

    • Posted by Author photo of Keith Crichtonkeithcrichton on February 2, 2016 2:36pm:

      To the best of my knowledge it has not been challenged, but it remains contrary to the state statute. I rather doubt that it would be upheld. but I'm not an attorney.


Access to any portion of is contingent upon your acceptance of our Terms of Use. This Web Site and content provided by STS Publishing, LLC and its third party content providers, including, but not limited to information, documents, forms, comments, advice and opinions, is for informational purposes only, and is not a substitute for professional advice, nor does the use of this Web Site constitute a professional-client relationship. The Web-Site also includes advertisements, directory listings, job postings and links to third party web sites, all of which are provided for your convenience only and in no way constitute a referral, endorsement, or warranty by of any product or service provided by such third parties. All content is provided “as is” with no guarantee regarding accuracy, suitability, or timeliness. Your reliance on any content accessed on or through the Web Site, or on any product or service provider is strictly at your own risk.