Real and Personal
Colorado property taxes have three main components: the actual value of property, the assessment rate, and the mill levy. Local assessors establish the actual value of the property and the property's classification (residential, commercial, or personal). The Colorado Legislature determines assessment rates, and local taxing entities determine mill levies.
The assessment rate for commercial and industrial property is set at 29 percent of market value. The residential rate is adjusted every odd-numbered year in order to maintain a balance between the tax burden on residential and all other properties. The residential assessment rate is 7.96 percent for 2009 and 2010 assessments. The average mill levy in Metro Denver was 87.302 in 2009 per $1,000 of assessed value.
Property Tax Assessment Rates
| Property Class | Assessment Rate & Method |
| Residential |
7.96%* |
| Commercial |
29% |
| Industrial |
29% |
| Personal |
29% |
| Mixed-Use |
7.96% for residential proportion, 29% for commercial |
| Vacant Land |
29% |
| Agricultural |
29%, with actual value based on capitalizing the average net income for the preceding 10 years at the cap rate of 13% (statutory) |
| Producing Mines |
Previous year's production value, 25% of gross proceeds, or 100% of net proceeds, whichever is greater. |
Oil and Gas Leaseholds and Lands
(Primary Production) |
87.5% of oil or gas sold or transported from premises, with modifications |
Oil and Gas Leaseholds and Lands
(Secondary Production) |
75% of oil or gas sold or transported from premises, with modifications |
| State Assessed Property |
29% |
| Exempt Property |
Assessed at appropriate rate, but not taxed |
*Residential assessment rate fluctuates from year-to-year
Business Real Property
Legislation passed in 2008 increases Colorado's business personal property tax exemption to $7,000 over five years. From the tax year beginning Jan. 1, 2015 onward, the exemption will be increased biennially to account for inflation.
Business real property is taxed at a standard 29 percent assessment rate, with the exception of producing mines and oil and gas leaseholds and lands (as described in above table).
Personal property (machinery and equipment) used in commercial and industrial operations is also assessed at 29 percent of actual value, based on replacement cost, expected economic life of the asset and other factors. Business personal property with an economic life of one year or less, or with acquisition cost of $250 or less, is exempt from taxation.
Computer and telecommunications equipment have accelerated depreciation schedules and reduced residual values. Local governments, including municipalities, counties, and school districts, have the option to negotiate up to 50 percent rebate or credit on their portion of personal property tax as an economic development incentive.
Provided that state revenues produce a surplus, business taxpayers receive a credit against their state corporate income tax for business personal property taxes paid to Colorado municipalities.