Your Colorado W-2 carries the state’s tax information in a specific cluster of boxes: Boxes 15, 16, and 17 report Colorado wages and the 4.0% state income tax withheld, Box 14 shows your FAMLI premium contribution, and Boxes 18 through 20 hold any local taxes like the Denver Occupational Privilege Tax. The numbers in these boxes are what the Colorado Department of Revenue (CDOR) uses to match your state return against what your employer reported.
What Boxes 15, 16, and 17 Show
Box 15 holds two things: the state abbreviation “CO” and your employer’s Colorado withholding account number. That account number is not the federal Employer Identification Number printed elsewhere on the form. The CDOR assigns it separately when an employer registers a Colorado wage withholding account, and it is how the state ties your W-2 to your employer’s tax payments.1Department of Revenue – Taxation. Withholding Tax Guide
Box 16 is your Colorado taxable wages. It often matches Box 1 (federal wages), but not always. Some items excluded from federal wages, such as contributions to a 457(b) deferred compensation plan or a 403(b) retirement plan, may still count as taxable income for Colorado. When that happens, Box 16 will be higher than Box 1. The reverse can happen too, if Colorado excludes something the federal return includes.
Box 17 is the total Colorado income tax your employer withheld from your paychecks for the year. This is the number you carry over to your state return to get credit for tax already paid. Withhold too much and you get a refund; too little and you owe.
FAMLI Premiums in Box 14
Box 14 is a catch-all for items that do not fit the other numbered boxes. For Colorado workers, the most common entry is FAMLI, the state’s Family and Medical Leave Insurance program. Employers report the employee’s share of FAMLI premiums here with the label “FAMLI.”2Family and Medical Leave Insurance. Employers This amount is not deducted on your Colorado return, but the W-2 shows it so you have a record of what was withheld.
Other things that sometimes land in Box 14 include union dues, educational assistance, and employer-specific codes. None of them affect how you report state withholding in Boxes 15 through 17. FAMLI is worth flagging because it is relatively new and employees occasionally mistake it for state income tax withholding.
Denver and Other Local Taxes in Boxes 18 Through 20
Boxes 18, 19, and 20 handle local income or occupational privilege taxes. Box 18 shows local taxable wages, Box 19 shows the local tax withheld, and Box 20 names the city or jurisdiction. For most Colorado employees these boxes are blank. If you work in Denver, they will not be.
Denver imposes an Occupational Privilege Tax (OPT) on anyone earning at least $500 in a calendar month within the city. The employee portion is $5.75 per month, withheld from your paycheck. Your employer also pays $4.00 per month on your behalf, though only the employee portion shows on your W-2.3denvergov.org. Tax Guide Topic 61 Occupational Privilege Taxes Box 20 should read “Denver” or a similar designation matching the jurisdiction where the tax was remitted.
Aurora repealed its occupational privilege tax effective January 1, 2025, so if you previously saw Aurora OPT on your W-2, it should no longer appear for tax year 2025 or later.4City of Aurora. Occupational Privilege Tax A handful of other Colorado municipalities still impose similar local taxes. Amounts withheld for any of them belong in Boxes 18 through 20 with the appropriate locality name.
Local taxes reported here generally do not transfer to Form DR 0104. You settle up with the local municipality directly, and the W-2 is your proof of what was withheld.
How the Numbers Flow Onto Form DR 0104
Colorado’s individual income tax return is Form DR 0104. The starting point is your federal taxable income from Form 1040, line 15, not your W-2 wages directly.5Colorado Department of Revenue. DR 0104 Colorado Individual Income Tax Return 2025 Colorado then applies its flat 4.0% rate to that figure after any state-specific additions or subtractions.
Box 17, your Colorado tax withheld, goes on the designated withholding credit line of the DR 0104. This is where the state credits you for tax already paid through payroll. If you have more than one W-2 with Colorado withholding, add up all the Box 17 amounts.
Box 16 helps you check whether your employer already accounted for Colorado-specific differences. If Box 16 differs from Box 1, look for a legitimate reason: a 403(b) or 457(b) contribution, for instance, that Colorado taxes but the federal government does not.
Subtractions That Can Reduce Your Colorado Tax
Some income that is taxable on the federal return gets subtracted on the Colorado return. These adjustments go on Schedule DR 0104AD, attached to the DR 0104.6Colorado Department of Revenue. DR 0104AD 2025 Subtractions from Income Schedule Common subtractions tied to W-2 income include:
- Military retirement benefits. Retired service members under 55 can subtract up to $15,000 of military retirement pay included in federal taxable income for tax year 2026. Those 55 and older may claim the larger general pension and annuity subtraction instead.7Department of Revenue – Taxation. Retired Servicemembers
- Pension and annuity income. Taxpayers 55 and older may subtract qualifying pension and annuity income, including PERA benefits, subject to annual limits set by the state.
Part-Year Residents and Nonresidents
If you lived in Colorado for only part of the year, or you are a nonresident who earned income from Colorado sources, you file the DR 0104 along with Schedule DR 0104PN. That schedule prorates your tax so you only pay Colorado on income earned while you were a resident or income sourced to the state.8Department of Revenue – Taxation. DR 0104PN Part-Year Resident/Nonresident Calculation Schedule Your W-2 Box 16 is the starting point for figuring out how much of your income Colorado can tax.
Working in Colorado and Another State
Colorado has no reciprocity agreements with other states. If you live in Colorado but work in another state, or the other way around, you may end up with withholding from both states on your W-2. When that happens, the employer reports each state’s information on a separate line in Boxes 15 through 17. If more than two states are involved, the employer issues a second W-2.9Internal Revenue Service. General Instructions for Forms W-2 and W-3 2026
Colorado residents who pay tax to another state on the same income can claim a credit for taxes paid to that other state on their Colorado return. That credit prevents true double taxation, but you have to file in both states to sort it out. The withholding shown on your W-2 by itself does not resolve the overlap.
If Something on Your W-2 Is Wrong
When a W-2 has mistakes in the Colorado boxes, the employer issues a corrected federal Form W-2c.10Internal Revenue Service. About Form W-2 C Corrected Wage and Tax Statements The corrected form goes to both you and the CDOR.
On your side, a W-2c usually means filing an amended Colorado return on Form DR 0104X. The amended return lets you fix the income and withholding figures from your original DR 0104.11Department of Revenue – Taxation. Amending an Individual Income Tax Return You can file the DR 0104X electronically through Revenue Online, and you should include your W-2c as supporting documentation.
One deadline catches people off guard. If the IRS adjusts your federal return and that change affects your Colorado tax, you have only 30 days from the date of the IRS notification to file the DR 0104X, even if the change does not alter your Colorado tax liability.11Department of Revenue – Taxation. Amending an Individual Income Tax Return Include a copy of the IRS agent’s report with your amended state return.