|To All Interested Parties, The Colorado Department of Revenue has updated the following wage withholding tax forms to account for changes to federal income tax deductions and the Colorado income tax rate.
DR 0004. Colorado Employee Withholding Certificate – This form gives employees the option to adjust their Colorado wage withholding according to their specific tax situation. If an employee does not submit this form, the employer will calculate their withholding based on their federal withholding certificate, form W-4. Employees may update their withholding certificate for 2023, but they are not required to.
DR 1098. Colorado Withholding Worksheet for Employers – This worksheet prescribes the method for employers to calculate Colorado wage withholding, based on the employee’s Colorado form DR 0004 or federal form W-4. Employers must begin using the updated calculation for pay periods beginning on or after January 1, 2023.
For a general overview of Colorado’s wage withholding requirements, the Department is offering a Wage Withholding Webinar on December 8, 2022 at 1:00 p.m. MST. To register for a webinar, go to Tax.Colorado.gov/Business-Tax-Class.
For additional information and resources regarding Colorado withholding, go to Tax.Colorado.gov/Withholding-Tax.