Colorado Guide for Canadians

Quick Facts

State Income Tax	4.25% flat rate (2025), subject to temporary reductions based on excess revenue
Sales Tax	2.9% state + local (average 8% total, up to 11.2% in some areas)
Driver's License Grace Period	30 days for residents
Residency Requirement for Tax	90 consecutive days or employed/own business in Colorado
Vehicle Registration Deadline	30 days for residents
REAL ID Deadline	May 7, 2025 for domestic flights

First 90 Days Checklist

Week 1-2: Essential Documents

• Gather required documents for driver's license
• Open US bank account
• Set up temporary mailing address

Week 3-4: Official Registration

• Apply for Colorado driver's license (within 30 days)
• Register vehicle if brought from Canada (within 30 days)
• Register to vote

Month 2-3: Establishing Residency

• Update address with Canadian financial institutions
• Establish Colorado ties
• Consider Colorado vehicle insurance

Driver's License & Vehicle Requirements

For Canadian Citizens

Required Documents:

• Original valid Canadian passport
• Proof of Social Security Number or ITIN (if applicable)
• Two proofs of Colorado residential address

Testing Requirements:

• Written test required for Canadian citizens
• Road test required - Colorado has NO reciprocal agreement with Canada
• Vision screening required

Important Notes:

• 30-day limit to get Colorado license after residency
• REAL ID required by May 7, 2025 for air travel
• Both written and road tests required for Canadians

Vehicle Registration

• Register within 30 days of establishing residency
• VIN verification required for out-of-state vehicles
• Emissions testing required in certain counties
• Colorado insurance required for registration

Tax & Residency Considerations

Colorado State Tax Benefits

• **Low flat income tax** 4.25% with potential temporary reductions
• **No inheritance tax**
• **Variable property taxes** by county (average 0.52% effective rate)
• **Low state sales tax** 2.9% state rate

Establishing Colorado Tax Residency

Colorado residency is based on physical presence and intent:

• 90 consecutive days in Colorado, OR
• Employed in Colorado, OR
• Own/operate a business in Colorado

Documentation to Establish Residency

• Colorado driver's license and voter registration
• Bank accounts and utility bills in Colorado
• Employment or business activities in Colorado
• Professional licenses, club memberships

US Federal Tax Implications for Canadians

Important: Under the Substantial Presence Test, you may be considered a U.S. resident for tax purposes.
Recommendation: Consult a cross-border tax professional.

Healthcare Considerations

Insurance Options

• Colorado has no public health insurance for non-citizens
• Travel insurance strongly recommended
• Consider US health insurance if staying permanently
• Quality medical facilities in Denver, Boulder, Colorado Springs

Prescription Medications

• Bring adequate supply from Canada
• Understand prescription transfer requirements
• US prices often higher than Canadian prices
• Research pharmacy options and discount programs

Special Considerations for Snowbirds

Maintaining Canadian Ties

• Keep principal residence in Canada
• Monitor days in U.S. for tax reasons
• Maintain Canadian insurance & banking relationships
• Colorado's 90-day residency trigger requires careful planning

Property Considerations

• Higher property values, especially in ski areas
• Senior homestead exemption available (50% of first $200,000)
• Impact on Canada's principal residence exemption
• Consider altitude effects on health and home maintenance

Climate & Lifestyle Benefits

• Four distinct seasons with abundant sunshine
• World-class skiing and outdoor recreation
• Higher altitude may affect some individuals
• Active Canadian expat community in Denver/Boulder area

Travel Documentation

• Ensure passport validity (6+ months remaining)
• Consider Global Entry/NEXUS for easier border crossings
• Track 90-day residency trigger carefully
• No Enhanced Driver's License available in Colorado

Outdoor Paradise

Colorado offers unparalleled outdoor recreation opportunities with 58 peaks over 14,000 feet, world-class skiing, and 300+ days of sunshine annually. The flat tax rate provides additional appeal for retirees.

Key Contacts & Resources