Colorado Payroll · 4.40% Flat Tax · DR 0004 Allowance · FAMLI · IRS Publication 15-T
Colorado Paycheck Calculator 2025
Estimate your Colorado take-home pay for hourly or salaried work in a single form. Covers federal income tax withholding, Social Security, Medicare, the flat 4.40% Colorado income tax with the DR 0004 annual withholding allowance, the employee-paid FAMLI paid-leave premium, and optional local Occupational Privilege Tax. Uses 2025 IRS Publication 15-T and the Colorado DR 1098 employer worksheet.
Pay Details
Colorado uses your IRS W-4 filing status to set the default withholding allowance.
Check this on Form W-4 if you hold two jobs or your spouse also works. It switches to the higher Step 2 federal withholding schedule.
W-4 Adjustments (Optional)
Annual federal dependent credit total (e.g. $2,000 per child under 17)
Step 4c additional federal withholding per paycheck
Colorado Form DR 0004
With no DR 0004, the employer default annual allowance is $10,000 (married filing jointly) or $5,000 (everyone else).
DR 0004 Line 3 additional Colorado withholding per paycheck (optional).
Flat monthly head tax on people who work in the city. Aurora repealed its OPT on Jan 1, 2025.
Enter your pay details and click Calculate to see your take-home pay breakdown.
Want the full Colorado payroll picture, including how the DR 0004 allowance is calculated, the FAMLI premium split, local Occupational Privilege Taxes, and employer unemployment premiums? Read the Colorado Payroll Taxes guide.
Colorado Payroll Taxes Guide →Short Answer
This Colorado paycheck calculator estimates net take-home pay after federal income tax withholding, Social Security (6.2%), Medicare (1.45%), the flat 4.40% Colorado income tax, and the employee-paid FAMLI paid-leave premium (0.45%). Colorado withholding is not just 4.40% of gross: the DR 1098 worksheet first subtracts an annual withholding allowance. For a single Colorado worker earning $65,000 per year paid biweekly with no DR 0004 on file (so the $5,000 default allowance applies), gross pay is about $2,500 per period, and net take-home is roughly $1,969 after about $227 of federal withholding, $155 Social Security, $36 Medicare, about $102 of Colorado income tax, and about $11 of FAMLI. Colorado has no percentage-based local income tax, though a few cities charge a small flat monthly Occupational Privilege Tax.
Key Takeaways
- Colorado has a flat 4.40% income tax on all taxable income for 2025. There are no brackets: your employer subtracts an annual withholding allowance and multiplies the rest by 4.40%.
- Withholding is not simply 4.40% of your pay. The DR 1098 worksheet first subtracts your annual withholding allowance, which defaults to $10,000 for married filing jointly or $5,000 for everyone else if you have not filed a DR 0004.
- Form DR 0004 is optional, but filing it lets you claim the larger Table 1 allowance (for example $12,500 for a single filer with one job, or $27,500 for a married couple with one job), which lowers withholding and raises your take-home pay.
- The FAMLI paid-leave premium is a genuine Colorado paycheck line: 0.45% of wages up to the $176,100 Social Security cap for 2025, capping the employee contribution at about $792 for the year. It drops to 0.44% for 2026.
- Colorado has no percentage local income tax, but Denver ($5.75/mo), Greenwood Village ($2/mo), Glendale ($5/mo), and Sheridan ($3/mo) charge a flat Occupational Privilege Tax. Aurora repealed its OPT on January 1, 2025. Unemployment tax is employer-paid, and Colorado has no reciprocity with other states.
- Federal income tax uses the IRS Publication 15-T percentage method on annualized wages. Social Security is 6.2% up to $176,100; Medicare is 1.45% with no cap plus a 0.9% surtax over $200,000. For bonuses and RSUs, use the Bonus Tax Calculator and RSU Tax Calculator.
2025 Colorado Payroll Tax Quick Reference
| Tax | Rate | Wage Base / Threshold | Notes |
|---|---|---|---|
| Federal Income Tax | 10%–37% | No cap | Graduated brackets. Based on W-4 filing status and Publication 15-T percentage method tables. |
| Social Security (OASDI) | 6.2% employee | $176,100 (2025) | Withholding stops at wage base. Employer matches 6.2%. |
| Medicare (HI) | 1.45% employee | No limit | Employer matches 1.45%. |
| Additional Medicare Tax | 0.9% | $200,000 single/HOH; $250,000 MFJ; $125,000 MFS | Employee only. Employer withholds once individual wages exceed $200,000 in the calendar year. |
| CO State Income Tax | 4.40% flat | Annual withholding allowance | DR 1098 worksheet. 4.40% of wages after the DR 0004 allowance (default $10,000 MFJ or $5,000 otherwise). |
| CO FAMLI (employee) | 0.45% (2025) | $176,100 (2025) | Half of the 0.9% total premium. Max about $792 for the year. Employer pays the other half (employers with 10+ workers). |
| Unemployment (SUI) | Employer-paid | $27,200 (2025) | Funded by employers through the Colorado Department of Labor and Employment. Nothing withheld from employees. |
| Local Occupational Privilege Tax | Flat $/month | Denver, Greenwood Village, Glendale, Sheridan | Head tax on people working in the city (e.g. Denver $5.75/mo). Not a percentage of wages. Aurora repealed its OPT Jan 1, 2025. |
How This Calculator Works
Hourly Mode: Gross Pay Per Period
Gross pay per period equals the hourly rate multiplied by hours worked per week, then scaled to the pay period. For biweekly pay: hourly rate × hours per week × 2. For weekly: hourly rate × hours per week. For semi-monthly and monthly: hourly rate × hours per week × (52 ÷ periods per year).
Salary Mode: Gross Pay Per Period
Gross pay per period equals annual salary divided by the number of pay periods per year. Weekly: ÷ 52. Biweekly: ÷ 26. Semi-monthly: ÷ 24. Monthly: ÷ 12.
Federal Income Tax: IRS Publication 15-T Worksheet 1A
The calculator annualizes your per-period gross wages and applies the IRS Publication 15-T percentage method (Worksheet 1A for automated payroll systems):
- Annualize gross wages and add Step 4a other income, then subtract Step 4b deductions.
- Subtract the line 1g allowance: $12,900 for married filing jointly or $8,600 otherwise. If the W-4 Step 2 box is checked, subtract $0 instead. The result is the Adjusted Annual Wage Amount (line 1i).
- Apply the Annual Percentage Method table for the W-4 filing status - the STANDARD schedule, or the Step 2 Checkbox schedule when the Step 2 box is checked - to get the tentative annual withholding (line 2g), then divide by pay periods (line 2h).
- Subtract Step 3 dependent credits (divided per period), then add Step 4c extra withholding. The result is federal income tax withheld per paycheck.
FICA: Social Security and Medicare
Social Security is 6.2% of gross wages up to the 2025 wage base of $176,100. Medicare is 1.45% of all wages with no cap. When annual wages exceed $200,000, the calculator adds the 0.9% Additional Medicare surtax that employers must withhold, regardless of filing status.
Colorado Income Tax: The DR 1098 Worksheet
Colorado applies a flat 4.40% rate, but not to your full pay. Following the Department of Revenue DR 1098 Colorado Withholding Worksheet for Employers, the calculator annualizes wages and then:
- Subtracts your annual withholding allowance. If you filed Form DR 0004, that is the amount you entered on Line 2. If you did not, the employer default is $10,000 for married filing jointly or qualifying surviving spouse, and $5,000 for everyone else.
- Multiplies the remainder (floored at zero) by 4.40%. This is the annual Colorado withholding.
- Divides the annual Colorado tax by your pay periods, then adds any additional Colorado withholding you requested on DR 0004 Line 3.
Because the DR 1098 default allowance ($5,000 or $10,000) is much smaller than the DR 0004 Table 1 allowance ($12,500 or more), an employee with no DR 0004 on file has more withheld and typically receives a refund at filing.
Colorado FAMLI: The Employee Premium
Colorado Family and Medical Leave Insurance is funded by a shared premium. For 2025 the total premium is 0.9% of wages, split evenly, so the employee share is 0.45% of gross wages, collected up to the Social Security cap of $176,100. That caps the 2025 employee premium at about $792 for the year. Every employee pays the 0.45% employee share; only employers with fewer than 10 workers are excused from paying the matching employer half. For 2026 the total premium falls to 0.88%, so the employee share becomes 0.44%.
Local Occupational Privilege Tax (OPT)
A handful of Colorado cities charge a flat monthly Occupational Privilege Tax on people who work in the city and earn above a monthly threshold: Denver $5.75 (earning more than $499/month), Greenwood Village $2, Glendale $5, and Sheridan $3. This is a fixed dollar amount, not a percentage. The calculator spreads the selected monthly OPT across your pay periods; in practice an employer withholds it once each qualifying month.
Worked Example: $65,000 Salary, Single, Biweekly
A single Colorado employee earns $65,000 per year, paid biweekly (26 periods), with the W-4 Step 2 box not checked and no DR 0004 on file (so the $5,000 default allowance applies). Gross pay per period is $65,000 ÷ 26 = $2,500.00.
Federal withholding detail: Annualized gross $65,000 minus the $8,600 line 1g allowance (W-4 Step 2 box not checked) = $56,400 Adjusted Annual Wage Amount. The STANDARD single schedule applies $5,578.50 plus 22% of the amount over $54,875 ($1,525 × 22% = $335.50), for a tentative annual withholding of $5,914.00 ÷ 26 = $227.46. Colorado detail: $65,000 minus the $5,000 default allowance leaves $60,000 of Colorado taxable wages; 4.40% × $60,000 = $2,640.00 for the year ÷ 26 = $101.54. FAMLI is 0.45% × $65,000 = $292.50 for the year ÷ 26 = $11.25. Net take-home is about $1,968.50 per paycheck, roughly $51,181 for the year. Effective federal withholding rate on gross: about 9.1%.
More Colorado Paycheck Scenarios (2025)
The two $65,000 single rows show why the DR 0004 is worth filing: raising the annual allowance from the $5,000 default to the $12,500 single one-job amount subtracts an extra $7,500 before the 4.40% applies, worth 4.40% × $7,500 = $330 of Colorado tax kept in your paychecks for the year rather than refunded. The married example uses the $10,000 default; a married couple with one income could file a DR 0004 for the $27,500 allowance and keep even more.
Practitioner Insight
The Colorado question we hear most is "why do I always get a big state refund?" People treat a refund as free money, but in Colorado it usually means one thing: they never filed a DR 0004. When there is no DR 0004 on file, the employer uses the DR 1098 default allowance of just $5,000 (or $10,000 for a married couple), which is far below a typical filer's real deductions and credits. So the 4.40% is applied to almost the whole paycheck, too much is withheld, and it comes back the next spring.
The fix is the DR 0004, and most people have never heard of it because it is optional and Colorado does not require it at hire. Filing it with the Table 1 standard allowance ($12,500 single one-job, $20,000 head of household, $27,500 married one-job) lowers withholding immediately. For a single filer that is roughly $330 a year moved from an April refund into every paycheck. Families with young children can go further with Worksheet 1, which folds in the Colorado child tax credit and can cut withholding to near zero for lower earners.
The other line that surprises new Colorado workers is FAMLI. It is only 0.45% of wages, but it is a real deduction that started in 2023 and shows up on the stub as its own line. And if you work in Denver, do not be alarmed by the $5.75 Occupational Privilege Tax; it is a flat monthly head tax, not a sign your payroll is broken.
When This Calculator Gives a Less Accurate Estimate
- Pre-tax deductions not entered: A 401(k) contribution reduces wages subject to both federal and Colorado income tax, but not Social Security, Medicare, or FAMLI, which ride on gross wages. This calculator does not model pre-tax deductions, so actual federal and state withholding is typically a little lower than the estimate.
- The DR 0004 Worksheet 1 with credits: If you complete Worksheet 1 to include the Colorado child tax credit or other credits, your allowance can be much larger than the Table 1 amount, sometimes reducing Colorado withholding to zero. Enter your actual DR 0004 Line 2 amount to model that.
- Occupational Privilege Tax timing: OPT is a flat monthly tax withheld once per qualifying month, not evenly per paycheck. This calculator spreads it across pay periods for an annualized estimate; a single paycheck in a month may show the full monthly OPT instead.
- Dual-income households: Each employer withholds federal tax independently based only on the wages it pays. If both spouses work and each W-4 uses single-job elections, combined federal withholding is often insufficient. Complete the Multiple Jobs Worksheet on Form W-4 or use the IRS withholding estimator at irs.gov.
- Bonuses and supplemental wages: Colorado withholds 4.40% on supplemental wages, and federal supplemental withholding is usually 22% below $1 million. This calculator covers regular wages only; use the Bonus Tax Calculator for a bonus.
Frequently Asked Questions
What is the Colorado income tax rate for 2025?
Colorado has a flat 4.40% income tax on all taxable income for 2025. Employers withhold Colorado tax using the DR 1098 worksheet: they take your annual wages, subtract an annual withholding allowance, and multiply the remainder by 4.40%. There are no tax brackets and no separate rate for higher earners. The 2024 rate was temporarily reduced to 4.25% by a TABOR surplus mechanism, but the 2025 withholding rate is 4.40%.
How does the Colorado DR 0004 form change my withholding?
Form DR 0004 is Colorado's optional employee withholding certificate. If you do not file one, your employer uses a small default annual allowance of $10,000 for married filing jointly or $5,000 for everyone else, which is designed to withhold enough that you usually get a refund. Filing a DR 0004 lets you claim a larger standard allowance from Table 1 (for example $12,500 for a single filer with one job, or $27,500 for a married couple with one job), which lowers your Colorado withholding and raises your take-home pay.
What is the FAMLI deduction on my Colorado paycheck?
FAMLI is Colorado's Family and Medical Leave Insurance program. For 2025 the total premium is 0.9% of wages, split evenly, so the employee share is 0.45% of wages up to the Social Security cap of $176,100. That caps the 2025 employee contribution at about $792 for the year. Every employee pays the 0.45% employee share; only employers with fewer than 10 workers are exempt from paying the matching employer half. For 2026 the total premium drops to 0.88%, so the employee share becomes 0.44%.
Does Colorado have local city income taxes?
Colorado has no percentage-based local income tax, but a few cities charge a flat-dollar Occupational Privilege Tax (OPT), also called a head tax, on people who work in the city. Denver charges employees $5.75 per month (when they earn more than $499 in the city that month), Greenwood Village $2, Glendale $5, and Sheridan $3. Aurora repealed its OPT effective January 1, 2025. The OPT is a fixed monthly dollar amount, not a percentage of your wages.
Why is my Colorado refund so large if withholding is just 4.4%?
If you never filed a DR 0004, your employer uses the small default allowance ($5,000 single, $10,000 joint), which is far below your actual Colorado deductions and credits. That means more tax is withheld during the year than you owe, producing a refund. Filing a DR 0004 with the correct Table 1 allowance (or the Worksheet 1 amount including the Colorado child tax credit) reduces over-withholding, so you keep more of each paycheck and get a smaller refund.
Does Colorado deduct unemployment tax from employees?
No. Colorado unemployment insurance premiums are paid entirely by employers through the Colorado Department of Labor and Employment. Nothing is withheld from employee wages for unemployment. The employee-paid items on a Colorado pay stub are federal income tax, Social Security, Medicare, the 4.40% state income tax, the 0.45% FAMLI premium, and any local Occupational Privilege Tax.
Does Colorado have tax reciprocity with other states?
No. Colorado has no reciprocal withholding agreements with any other state. If you live in another state but work in Colorado, your Colorado wages are subject to Colorado withholding, and you generally file a Colorado nonresident return and claim a credit on your home-state return for the tax paid to Colorado.
How does my W-4 affect my paycheck withholding?
Your federal W-4 filing status determines which Publication 15-T withholding table applies and, in Colorado, which default allowance the employer uses. Checking the Step 2 box (multiple jobs or a working spouse) switches to the higher Step 2 Checkbox schedule and removes the $8,600 or $12,900 line 1g allowance. Step 3 dependent credits reduce annual tentative federal withholding before it is divided by pay periods. Step 4a additional income increases the annualized base, Step 4b deductions reduce it, and Step 4c requests extra federal withholding per period. Colorado withholding follows the separate DR 0004, and FICA and FAMLI are not affected by either form.
What To Do Next
If your Colorado state tax line does not look like a clean 4.40% of your gross, that is expected: the DR 1098 method subtracts your annual withholding allowance first. If you get a large Colorado refund every year, file a DR 0004 with the Table 1 allowance for your filing status to move that money into your paychecks. For the full state picture, including FAMLI and employer taxes, read the Colorado Payroll Taxes guide.
For hourly workers who also receive overtime, the Hourly Paycheck Calculator lets you model specific hours and frequencies. To understand how federal withholding connects to your year-end return, see How Payroll Taxes Work, and to decode each line on your stub, see How to Read a Pay Stub.
If you have self-employment income in addition to wages, the 1099 Tax Calculator estimates your full federal tax burden including self-employment tax, and the Quarterly Tax Calculator helps you size estimated payments.
Sources & Editorial Disclosure
- IRS Publication 15-T (2025), Employer's Tax Guide to Federal Income Tax Withholding
- IRS Topic 751, Social Security and Medicare Withholding Rates
- IRS Topic 560, Additional Medicare Tax
- Colorado DR 1098, Colorado Withholding Worksheet for Employers: 4.40% rate, default annual allowance $10,000 (MFJ/QSS) or $5,000 (otherwise)
- Colorado DR 0004, 2025 Colorado Employee Withholding Certificate: Table 1 standard allowance ($12,500 single, $20,000 head of household, $27,500 married one-job)
- Colorado FAMLI, Family and Medical Leave Insurance: 2025 total premium 0.9%, employee share 0.45%, wage cap $176,100
- Denver Tax Guide Topic 61, Occupational Privilege Taxes: employee $5.75/month over $499
- Authored by Munib Ur Rehman · Reviewed by Nausheen Shahid, LMN Tax Inc. Not affiliated with the IRS or the Colorado Department of Revenue. For informational purposes only.