Colorado § 24-35-103.5 - Private letter rulings - information letters - fees - creation of fund - definitions.

§ 24-35-103.5. Private letter rulings - information letters - fees - creation of fund - definitions.

(1) As used in this section, unless the context otherwise requires:

(a) "Information letter" means a nonbinding statement issued by the department of revenue to a taxpayer that provides general information regarding any tax or fee administered by the department pursuant to section 39-21-102 that is made in response to a written request from a taxpayer for such information.

(b) "Private letter ruling" means a written determination issued by the executive director of the department of revenue, or the executive director's designee, to a taxpayer on the consequences of a proposed or completed transaction under any tax or fee administered by the department pursuant to section 39-21-102 that is made in response to a written request from a taxpayer for such a ruling.

(2) The executive director of the department of revenue, or the executive director's designee, shall, except as otherwise provided by rule, issue information letters and private letter rulings upon the written request of a taxpayer. The executive director shall promulgate rules in accordance with article 4 of this title establishing the process for issuing an information letter or a private letter ruling, including but not limited to rules that specify:

(a) The procedure, form, and time periods for submitting a request for an information letter or a private letter ruling;

(b) The terms and conditions under which a private letter ruling binds the department of revenue or may be revoked or modified; except that any revocation by the department of a private letter ruling shall only be effective prospectively and shall not affect any transaction undertaken on or prior to the date of the revocation;

(c) The limitations on the applicability of an information letter or a private letter ruling to specific persons, transactions, factual circumstances, and time periods;

(d) The circumstances under which a request for an information letter or a private letter ruling may be declined by the executive director of the department of revenue.

(3) (a) Except as set forth in subsection (3)(b) of this section, the executive director of the department of revenue shall issue private letter rulings within ninety days after the receipt of a written request by a taxpayer, unless the executive director declines the request. In the event the executive director declines a request for a private letter ruling, the executive director shall notify the taxpayer in writing of such declination no later than thirty days after the date the request was submitted to the department.

(b) The executive director of the department of revenue may extend the ninety-day period described in subsection (3)(a) of this section upon the approval of the taxpayer.

(3.5) The department of revenue shall track the total full-time equivalent personnel positions necessary and the hours dedicated by each FTE for the issuance, declination, modification, or revocation of all information letters or private letter rulings as required by this section.

(4) The issuance, modification, or revocation of an information letter or a private letter ruling shall not constitute a tax policy change for purposes of section 20 (4)(a) of article X of the state constitution.

(5) (a) The executive director of the department of revenue shall redact information from an information letter or private letter ruling in order to ensure the confidentiality of the taxpayer or other persons, transactions, factual circumstances, or time periods that are the subject of the information letter or private letter ruling and make public the balance of the information letter or private letter ruling.

(b) The executive director may withhold the information letter or private letter ruling from the public based upon a determination that information in the information letter or private letter ruling cannot be redacted in a manner that maintains the confidentiality of the taxpayer or other persons, transactions, factual circumstances, or time periods that are the subject of the information letter or private letter ruling. Such a determination shall be subject to review by a court of competent jurisdiction.

(6) The executive director of the department of revenue shall promulgate rules pursuant to article 4 of this title establishing reasonable fees for the direct and indirect costs of the administration of this section, which fees shall accompany any request for a private letter ruling made pursuant to subsection (1) of this section. All fees collected shall be transmitted to the state treasurer, who shall credit the same to the private letter ruling fund, which fund is hereby created. The moneys in the fund shall be subject to annual appropriation by the general assembly for the direct and indirect costs of the administration of this section.

(7) Repealed.

Source: L. 2006: Entire section added, p. 1419, § 1, effective June 1. L. 2011: (7) amended, (SB 11-089), ch. 260, p. 1136, § 3, effective July 1. L. 2016: (3.5) added and (7) amended, (HB 16-1232), ch. 336, p. 1367, § 1, effective June 10. L. 2023: (1) and (3) amended and (7) repealed, (SB 23-156), ch. 137, p. 580, § 2, effective August 7.