2026 tax year · Colorado
Marketplace seller taxes in Colorado
Etsy, eBay, Shopify and the rest report your gross and withhold nothing. The gap between that and what you are actually taxed on is your costs, in Colorado that gap is worth $6,933 in tax.
Take a driver who grossed $45,000 over 18,000 business miles. After mileage at 74.3 cents and the rest of the stack, worked through on the marketplace seller page $26,775 comes off and $18,225 is left as taxable profit. That profit is what Colorado and the IRS charge against.
What that leaves you owing in Colorado
Colorado taxes income at a flat 4% for 2026, applied on top of federal income tax and self-employment tax.
| Self-employment tax | $2,575 |
| Federal income tax | $67 |
| Colorado income tax | $677 |
| Total tax | $3,320 |
| Effective rate on gross | 7.4% |
Earning more in Colorado
A single filer taking the standard deduction, this work as the only income, the calculator above handles the other filing statuses. Miles rise with earnings, so the deduction rises too, and the effective rate on gross climbs more slowly than it would for someone whose income grew without expenses attached:
| Volume | Gross | Mileage off | Taxable profit | Colorado tax | Total tax | Rate on gross |
|---|---|---|---|---|---|---|
| Part-time | $15,000 | $0 | $15,000 | $558 | $2,677 | 17.8% |
| Steady side income | $45,000 | $0 | $45,000 | $1,673 | $10,252 | 22.8% |
| Full-time | $72,000 | $0 | $72,000 | $2,677 | $17,480 | 24.3% |
Switching state opens that state's page.
Enter your numbers and press Calculate to see your 2026 estimate.
Colorado specifics that change the number
Colorado is one of the twelve states that still taxes Social Security benefits, which matters if you are drawing benefits alongside self-employment income.
Selling into and out of Colorado
Income tax follows you: Colorado taxes your profit wherever the buyer was. Sales tax does not. Marketplace facilitator laws make the platform collect and remit sales tax on your behalf in most states, which is why a seller can have customers in all fifty and still file only one income tax return. Selling off-platform is where that stops being true.
On $18,225 of profit, what the states around Colorado would charge:
| State | Its tax | vs Colorado |
|---|---|---|
| Wyoming | No income tax | −$729 |
| Nebraska | $596 | −$133 |
| New Mexico | $603 | −$126 |
| Kansas | $649 | −$80 |
| Oklahoma | $785 | +$56 |
| Utah | $820 | +$91 |
- Wyoming has no income tax at all, so the same work done there costs $729 less in state tax than it does in Colorado.
- Nebraska would take $133 less, $596 against Colorado's $729.
- New Mexico would take $126 less, $603 against Colorado's $729.
- Kansas would take $80 less, $649 against Colorado's $729.
- Oklahoma would take $56 more, $785 against Colorado's $729.
- Utah would take $91 more, $820 against Colorado's $729.
Marketplace seller tax questions in Colorado
How much should a Colorado seller set aside?
About 7.4% of gross on the $45,000 example, $3,320 across self-employment tax, federal income tax and $677 to Colorado. Set aside from each payout rather than finding it in April.
Does the $45,000 on my 1099-NEC match what Colorado taxes?
No. Colorado taxes profit, not gross. After $26,775 of deductions the taxable figure is $18,225, so the Colorado bill is $677 rather than what gross alone would suggest.