Author: 
Chris Walton
Subtitle: 
Make sure your new business complies with Colorado's recently updated process for opening an unemployment insurance tax account.
Important Tip In addition to paying unemployment insurance tax, don't forget to obtain workers' compensation insurance.

If you start a new business in Colorado and hire employees, then you are required to register with the state by completing Form CR 0100, which can be found at http://www.colorado.gov/cs/Satellite/Revenue/REVX/1177017542056.  The form is used by multiple Colorado agencies for various purposes, such as applying for a Colorado sales tax license and establishing wage withholding taxes.  Until recently, Form CR 0100 was also used to establish an unemployment insurance tax account.  However, as of August 2009, Colorado has introduced a second form, UITL-100, that is to be used for applying for an unemployment insurance account. 
 
Colorado provides unemployment benefits to employees who lose their job through no fault of their own.  Those benefits are funded through unemployment insurance (“UI”) taxes paid by employers based on the number of their employees.  For example, a business that pays at least one employee at least $1,500 in a calendar quarter must provide unemployment insurance coverage.  However, there are exceptions to this requirement and not all employees subject a business to the UI tax.  For instance, unemployment insurance taxes are not paid for partners in a general partnership or members of a limited liability company.  

In order to determine how much unemployment tax to pay, you must complete and submit UITL-100 to Colorado.  The state will then issue your business an unemployment tax account number, and tell you what your unemployment tax rate is.  Employers are required to pay unemployment tax on the first $10,000 of each employee’s wages.  Unemployment tax payments are submitted to the state, along with a report, on a quarterly basis.

Additional Information
Important Tip: 
In addition to paying unemployment insurance tax, don't forget to obtain workers' compensation insurance.
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registering your business and setting up your unemployment insurance tax account