2026 tax year · Colorado
Services and task work taxes in Colorado
TaskRabbit, Rover, Upwork and the rest report your gross and withhold nothing. The gap between that and what you are taxed on is mileage, in Colorado that gap is worth $2,283 in tax.
Take a driver who grossed $34,000 over 18,000 business miles. After mileage at 74.3 cents and the rest of the stack, worked through on the services and task work page $9,030 comes off and $24,970 is left as taxable profit. That profit is what Colorado and the IRS charge against.
What that leaves you owing in Colorado
Colorado taxes income at a flat 4% for 2026, applied on top of federal income tax and self-employment tax.
| Self-employment tax | $3,528 |
| Federal income tax | $568 |
| Colorado income tax | $928 |
| Total tax | $5,025 |
| Effective rate on gross | 14.8% |
Earning more in Colorado
A single filer taking the standard deduction, standard mileage method, this work as the only income, the calculator above handles the other filing statuses. Miles rise with earnings, so the deduction rises too, and the effective rate on gross climbs more slowly than it would for someone whose income grew without expenses attached:
| Volume | Gross | Mileage off | Taxable profit | Colorado tax | Total tax | Rate on gross |
|---|---|---|---|---|---|---|
| Part-time | $11,000 | $1,485 | $9,515 | $354 | $1,698 | 15.4% |
| Steady side income | $34,000 | $4,455 | $29,545 | $1,098 | $6,182 | 18.2% |
| Full-time | $55,000 | $7,425 | $47,575 | $1,769 | $10,942 | 19.9% |
Colorado specifics that change the number
Colorado is one of the twelve states that still taxes Social Security benefits, which matters if you are drawing benefits alongside self-employment income.
Working across a Colorado line
Services income is sourced to where the work was physically done. A job over the line can create a filing obligation in that state even for a single afternoon, and reciprocity agreements do not help, they cover wages paid by an employer, not self-employment income.
On $24,970 of profit, what the states around Colorado would charge:
| State | Its tax | vs Colorado |
|---|---|---|
| Wyoming | No income tax | −$999 |
| Nebraska | $835 | −$164 |
| New Mexico | $933 | −$66 |
| Kansas | $1,033 | +$34 |
| Oklahoma | $1,089 | +$90 |
| Utah | $1,124 | +$125 |
- Wyoming has no income tax at all, so the same work done there costs $999 less in state tax than it does in Colorado.
- Nebraska would take $164 less, $835 against Colorado's $999.
- New Mexico would take $66 less, $933 against Colorado's $999.
- Kansas would take $34 more, $1,033 against Colorado's $999.
- Oklahoma would take $90 more, $1,089 against Colorado's $999.
- Utah would take $125 more, $1,124 against Colorado's $999.
Services and task work tax questions in Colorado
How much should a Colorado contractor set aside?
About 14.8% of gross on the $34,000 example, $5,025 across self-employment tax, federal income tax and $928 to Colorado. In practice that means moving about $148 of every $1,000 payout into a separate account the day it lands, and sending roughly $1,256 to the IRS each quarter, no platform withholds any of this for you. Set aside from each payout rather than finding it in April.
Does the $34,000 on my 1099-NEC match what Colorado taxes?
No. Colorado taxes profit, not gross. After $9,030 of deductions the taxable figure is $24,970, so the Colorado bill is $928 rather than what gross alone would suggest. The form reports what the platform paid out, it knows nothing about your costs, and no one subtracts them for you. On this example 27% of the gross never becomes taxable income, but only for the contractor who kept the records to prove it.