# Colorado pay stubs: flat tax, FAMLI and local OPT

> Colorado paychecks show flat state income tax, the FAMLI paid leave premium and, in some Denver-area cities, an occupational privilege tax. Details inside.

Source: https://www.paystubnest.com/states/colorado
State: Colorado (CO)
Published: 2026-09-25
Last reviewed: 2026-10-12
Publisher: PayStubNest.com

## Short answer

Colorado withholds a flat state income tax (4.4% for 2026). Employees also pay part of the FAMLI paid family and medical leave premium: for 2026 the total premium is 0.88% of wages, and employers may deduct up to half, 0.44%, from pay. Denver, Glendale, Greenwood Village and Sheridan also charge a small monthly occupational privilege tax. Federal income tax, Social Security and Medicare are withheld too.

## State income tax

Colorado's constitution requires a single flat income tax rate, and for 2026 that rate is 4.4%. Employers figure withholding from the federal Form W-4 information using the state's formula. Employees who want different Colorado withholding can file the optional **Form DR 0004**, the Colorado Employee Withholding Certificate.

## Other state payroll deductions

**FAMLI**, Colorado's Family and Medical Leave Insurance program, is funded by premiums on wages. For 2026 the premium is 0.88% of wages. Employers can deduct up to half of it, 0.44%, from employee paychecks and pay the rest themselves; some employers choose to cover the whole premium. Like Social Security, FAMLI premiums apply only up to the Social Security wage base, so the deduction stops for employees who pass that amount. Employers with fewer than 10 employees still collect and send in the employee share, but they do not owe the employer half.

State unemployment insurance is an employer tax in Colorado, so it does not appear as an employee deduction.

## Local taxes

A few Denver-area cities charge an **occupational privilege tax** (OPT): Denver, Glendale, Greenwood Village and Sheridan. It is a flat monthly amount rather than a percentage, and each city sets its own amount and earnings threshold, with a matching amount paid by the employer. The tax depends on where the employee works, not where they live.

## Federal withholding still applies

The federal side of a Colorado pay stub has three standard lines:

1. Federal income tax, calculated from the answers on Form W-4.
2. Social Security at 6.2%, which stops once year-to-date wages reach the annual Social Security wage base.
3. Medicare at 1.45% with no cap, plus 0.9% Additional Medicare Tax on wages over $200,000 for the year.

## Creating a Colorado pay stub with PayStubNest

Enter the hours worked and hourly rate, or an annual salary, and choose Colorado as the work state. The exact figures on each stub depend on the employee's pay, pay frequency, W-4 choices, deductions and year-to-date totals, so no two paychecks are quite alike. PayStubNest calculates all of it automatically, applying federal and Colorado withholding and carrying year-to-date totals forward from one stub to the next. You can [preview a stub for free](https://www.paystubnest.com/app/new) and only pay when you download it.

## Record-keeping tip

Because OPT is charged per month, track which months an employee actually worked in an OPT city and met the earnings threshold. Keep FAMLI deductions and employer premiums in separate columns so quarterly reports match. Rates and forms are on the [Colorado Department of Revenue](https://tax.colorado.gov/) and [FAMLI](https://famli.colorado.gov/) websites.