Short-Term Rental Rules in Colorado (2025–2026)

Colorado has no statewide STR license, but every host owes state sales tax, a local permit, and often a separate local tax registration. Failure to comply can lead to fines, back taxes, and a delisted property.

Quick Answer: What Colorado STR Hosts Must Know

Colorado short-term rental regulation is almost entirely local. The state sets tax requirements, but the host's city or county determines operational rules, including licensing, occupancy limits, and residency requirements.

Every Colorado STR host must address the following:

• State sales tax: A state sales tax (currently 2.9%) applies to all lodging stays under 30 days (C.R.S. § 39-26-104). Marketplace facilitators like Airbnb and VRBO generally collect this on behalf of hosts. Hosts taking direct bookings are responsible for collection and remittance.
• Local permits: Permits are required in nearly all of Colorado's active STR markets. Operating without one risks fines, forced delisting, and back-tax liability.
• Home-rule city taxes: Cities like Denver and Boulder administer their own sales tax systems. Even if a platform collects state tax, hosts are typically responsible for separate local tax registration and remittance.
• Owner-occupancy rules: Requirements vary by jurisdiction. Denver and Boulder require the STR to be the host's primary residence. Breckenridge does not have this requirement in its commercial zones. Hosts must check local rules before listing a property.
• HOA restrictions: Homeowners' association rules can prohibit STRs independently of municipal regulations. A city permit does not override a deed restriction or HOA covenant.

Hosts not yet registered for a local STR license and applicable local tax accounts should pause operations until these are secured.

State-Level Rules: Taxes, Marketplace Facilitators & DOLA Oversight

Colorado's state government regulates STRs primarily through tax collection rather than a statewide licensing system.

State Sales Tax on Lodging

Colorado imposes a state sales tax on short-term lodging rentals, defined as stays of fewer than 30 consecutive days (C.R.S. § 39-26-104). Stays of 30 days or more are generally exempt from this tax. Consult the Colorado Department of Revenue for the current sales tax rate.

Marketplace Facilitator Rules

Under state law, a marketplace facilitator that exceeds a set sales threshold in Colorado must collect and remit state sales tax for all transactions it facilitates (C.R.S. § 39-26-102(3.5)). Major platforms like Airbnb and VRBO meet this threshold and handle state sales tax for their bookings.

Hosts who take direct bookings through their own website or a smaller platform must register with the Colorado Department of Revenue and file their own returns. Consult the Department of Revenue for information on registering through its online portal.

Lodging and Automobile Rental Tax (LART)

Colorado's LART is not a statewide tax. It applies only within specific special districts. Consult the Colorado Department of Revenue's publications to determine if a property falls within a LART district.

DOLA's Role

The Department of Local Affairs (DOLA) does not license or regulate STRs. However, recent legislation (SB 25-100) provided supplemental appropriations to DOLA for housing-related programs. While this bill does not create an STR registry, the funding could support future housing data collection that may include STR inventories. As of 2025, no statewide STR registry exists in Colorado.

Tenancy Protections

Guests in STRs for stays under 30 days generally do not acquire tenant rights under standard Colorado landlord-tenant statutes. Consult legal counsel for specific situations, such as a guest who overstays their booking.

Local Licensing Requirements: Denver, Boulder, Breckenridge & Beyond

Local ordinances contain the most significant STR regulations. Always verify rules with the issuing authority before applying for a license.

Denver

Denver requires a Short-Term Rental license for all STRs. The property must be the host's primary residence. Denver actively enforces this requirement; consult the city's licensing division for details on how primary residency is verified. Non-owner-occupied STRs are not permitted in most residential zones.

Boulder

Boulder requires a Short-Term Rental license, and the property must be the host's primary residence. The city also imposes guest limits and may cap the number of rental nights allowed per year. Boulder enforces its ordinance, and non-compliant listings may be reported for removal.

Breckenridge and Summit County

As a resort market, Breckenridge does not impose a primary-residence requirement in its commercially zoned areas. Hosts need a business license and a separate sales tax license from the Town of Breckenridge. Summit County's unincorporated areas have their own STR regulations separate from the town's.

Steamboat Springs

Steamboat Springs requires an STR permit. Some residential zones have neighborhood caps that limit the percentage of homes that can hold active STR licenses. A primary-residence preference may apply in certain zones, meaning non-owner-occupied licenses could face additional restrictions.

Telluride

Telluride has implemented strict caps on STR licenses. In capped areas, new licenses are often issued through a lottery system. Purchasing a property in Telluride does not guarantee that an STR license will be granted. Prospective buyers should confirm license availability with the town before closing.

Unincorporated Counties

Counties such as Pitkin and Eagle have their own STR ordinances and land use codes. Regulations in other counties vary. The property's zoning classification is the first determining factor, as STRs may be prohibited in certain residential zones regardless of licensing availability. Contact the specific county planning department for details.

HOA Rules

An HOA's covenants, conditions, and restrictions (CC&Rs) can prohibit or restrict STRs more severely than any municipal rule. These restrictions are enforceable through civil action. A city license does not override an HOA prohibition.

Permit Fees, Processing Times & Requirements: Colorado Comparison

Fees are approximate and subject to change. Verify current amounts and processing times directly with each issuing authority.

Additional costs to budget for:

• Colorado state sales tax license: free registration via the Department of Revenue
• Local sales/lodging tax registration: varies by jurisdiction
• Zoning verification letters or pre-application meetings: varies by jurisdiction

Local Tax Obligations: Sales, Lodging & Excise Taxes

Colorado STR hosts must navigate a multi-layered tax structure.

Layer 1: State Sales Tax

This tax is collected by marketplace facilitators for state-level obligations. If you book directly, you must collect and remit this tax to the Colorado Department of Revenue.

Layer 2: State-Administered Local Sales Taxes

Some municipalities have the state collect local sales tax on their behalf. For these jurisdictions, marketplace facilitators may collect local tax along with state tax. Use the Colorado Sales Tax Lookup tool at tax.colorado.gov to identify all state-administered rates for a specific address.

Layer 3: Home-Rule City Sales Tax

Home-rule cities like Denver and Boulder administer their own local sales tax systems. Platforms do not necessarily collect these taxes. Hosts must register independently with the city's finance or treasury department and remit local taxes directly. Hosts frequently overlook this requirement.

Layer 4: Local Lodging and Excise Taxes

Resort towns and special districts often impose additional lodging, tourism, or transportation taxes. The Colorado Sales Tax Lookup tool at tax.colorado.gov is the most reliable way to identify all applicable rates for a property's address.

Penalties for Non-Compliance

Failure to collect and remit sales tax can result in back taxes, interest, and penalties. Consult the Colorado Department of Revenue for the current penalty structure. Back-tax liability can extend several years and accumulate quickly.

What Changed Recently: 2024–2025 Colorado STR Regulatory Activity

While no recent bills directly regulate STRs statewide, several 2024–2025 laws affect property use and local governance.

HB 24-1152: Accessory Dwelling Units (Signed 2024)

This law requires most Colorado municipalities to allow accessory dwelling units (ADUs) by right in single-family residential zones. This may increase the number of properties with a legal structure that could be used as an STR. However, the law does not override local STR licensing requirements or owner-occupancy rules. An ADU still requires a local STR license to be operated as a short-term rental.

HB 24-1313: Housing in Transit-Oriented Communities (Signed 2024)

This law mandates upzoning in areas near transit corridors. Because some STR license categories are zone-specific, a change in a property's zoning classification under this law could affect its STR eligibility. Hosts in affected areas should verify their status with their local planning department.

SB 25-100: DOLA Supplemental Appropriation (Signed 2025)

This bill provided additional funding to the Department of Local Affairs for housing programs. The funding supports housing data infrastructure that could eventually be used for STR inventory tracking. No new reporting requirements for hosts have been announced.

HB 1036 (2026A): Local Taxes on Vacant Residential Property (Postponed Indefinitely)

This bill, which would have allowed local governments to tax vacant residential properties, was postponed indefinitely and did not pass. Its introduction signals legislative interest in tools to address housing supply, which could affect how STR properties are classified for tax purposes in the future.

Municipal Trend: Tightening Resort Caps

Some resort municipalities have recently tightened STR caps or converted to lottery systems for issuing new licenses. Hosts in these markets should monitor local town council agendas, as changes can be adopted with little notice.

Next Steps: How to Get Licensed and Who to Contact

Follow these steps to ensure compliance.

Step 1: Confirm zoning. Contact your local planning department to verify that your property's zone district allows STRs. Ask if owner-occupancy is required and if any neighborhood license caps are in effect.

Step 2: Register for a Colorado state sales tax license if you take any direct bookings. Register through the Colorado Department of Revenue's online portal.

Step 3: Apply for your local STR permit or license. Contact the appropriate municipal department for applications and requirements.

Step 4: Register for local sales and lodging tax with your home-rule city if applicable. Denver hosts register with the city's Treasury Division; Boulder hosts register with the city's Finance Department.

Step 5: Review your HOA CC&Rs and any deed restrictions before listing the property.

Step 6: Set up a tax remittance calendar. State and local tax filing deadlines vary. Missing a filing can trigger penalties even if the tax has been paid.

Key Contacts

Hosts with multiple properties or significant revenue should consider working with a Colorado CPA or tax attorney specializing in STRs. The layered tax structure creates complexity where professional guidance is valuable.