Colorado · Payroll closure
Close a Colorado payroll tax account.
Colorado registers you for wage withholding and unemployment insurance with a single application, which is genuinely convenient. Nothing about closing works that way. Revenue and Labor and Employment each need telling separately, and the symmetry people expect is not there.
Last updated:
Who you are dealing with
Colorado Department of Revenue
- Handles:
- Wage withholding account
- System:
- Revenue Online
- Form:
- Close the account in Revenue Online, or file DR 1108, the Business Account Closure Form. Revenue states that DR 1108 takes longer to process than closing online
Colorado Department of Labor and Employment
- Handles:
- Unemployment insurance employer account
- System:
- MyUI Employer
- Form:
- Handled separately. Revenue directs unemployment insurance questions to Labor and Employment, since the unemployment premium is not a tax it administers
Colorado Department of Labor and Employment, payroll closure
State fee. $0. Neither agency charges to close an employer account. Any outstanding withholding tax or unemployment premium survives the closure.
Our fee. $180 per state, flat. State fees are passed through at cost.
When you have to close or cancel
You close when you stop paying Colorado wages. Both accounts need addressing, and because one application opened them, businesses reasonably assume one action closes them. It does not.
Final returns come first
File the final wage withholding return through Revenue Online before closing the account, and bring the unemployment premium reporting current with Labor and Employment. A closed account with an unfiled final return leaves an obligation standing behind it.
How long it takes
Colorado does not publish a specific processing time, but it does tell you which route is slower. The Department of Revenue states that DR 1108 takes longer to process than closing the account through Revenue Online, which is a rare piece of honest guidance and worth acting on.
What we do
We confirm which accounts are open, file any outstanding final returns, submit each cancellation, and follow up until every agency confirms in writing. You keep the client. We never email them.
Opening an account in another state instead? State payroll tax registration covers the withholding and unemployment accounts payroll software will not open.
What makes Colorado harder than average
- One registration, two closures. A single Colorado application registers you for both Department of Revenue wage withholding and Department of Labor and Employment unemployment insurance. Nothing closes them together. That asymmetry is the whole problem with Colorado, and it catches people who did the registration themselves and remember how easy it was.
- The form is the slow route and the state says so. Revenue states plainly that DR 1108 takes longer to process than closing through Revenue Online. If you have online access, use it. If you file the form because it feels more official, expect to wait.
- Revenue will not help with the unemployment side. The Department of Revenue directs unemployment insurance questions to Labor and Employment, because the unemployment premium is not a tax it administers. Calling the wrong agency gets you a redirect, not an answer.
- Premiums are not taxes, and the vocabulary matters. Colorado calls the unemployment charge a premium rather than a tax, which sounds like pedantry until you are searching the wrong agency's site for the wrong word.
Dissolving the company is not the same as closing the tax accounts
Articles of dissolution leave the withholding, unemployment, and sales tax accounts open, and those agencies keep expecting returns until each one is closed with them. That is the separate filing that stops the notices.
How Colorado compares
Every state closes them differently. The table compares Colorado with the other states we have documented, agency by agency.
For CPAs and bookkeepers
Send the state, the last payroll or sale date, and the account numbers. The written confirmations come back to you. We do not dissolve the company and we do not take over payroll.
Questions and answers
One application opened both accounts. Does one action close both?
No, and this is the main thing to know about Colorado. Registration is combined, closure is not. The Department of Revenue closes wage withholding and the Department of Labor and Employment closes unemployment insurance, separately.
Should I use DR 1108 or Revenue Online?
Revenue Online, if you have access. The Department of Revenue states that the DR 1108 form takes longer to process than closing through the online system. The form is there for people who cannot get online.
Who do I ask about the unemployment account?
The Colorado Department of Labor and Employment. The Department of Revenue directs unemployment insurance questions there, because the unemployment premium is not a tax that Revenue administers.
Does closing the account clear what I owe?
No. Outstanding withholding tax and unemployment premiums survive the closure. The account status and the balance are separate things in Colorado as everywhere else.
What do you need from me to start?
The legal name and FEIN, the Colorado account number and the unemployment account number, the date of the last Colorado wages, and whether the final withholding return has been filed.
Also in Colorado
Agency details verified 2026-08-03
About the provider
Regcrest LLC is a document preparation and filing service based in Allentown, Pennsylvania, founded in 2026. It prepares and files state payroll and sales tax registrations, account closures, and resale certificates on behalf of the businesses that instruct it, and works behind accounting firms, bookkeepers, and payroll providers as well as directly with businesses.
Regcrest LLC is not a CPA firm and not a law firm. It gives no tax or legal advice. It files in all 50 states, and publishes a full page for the 29states it has verified against the agency's own material so far, each one showing the date it was checked. For anything that turns on your specific situation, ask a licensed accountant or attorney.