Only 11 Colorado Residents Paid Their State Income Taxes With Crypto This Year

Last September, Governor Jared Polis announced that Colorado residents could pay state taxes with crypto


Ahmed Zaggoudi/Shutterstock modified by Blockworks


Residents of Colorado are able to pay their state income taxes in select cryptocurrencies. This is the first year that residents are able to use this method, after Governor Jared Polis announced the change last September. 

However, as reported by 5280, only 11 residents opted to pay their state income taxes with crypto by April 14. In 2020, Colorado had 3.1 million individual tax returns.

Applicable taxes include individual and business taxes, withholdings, severance and excise fuel taxes. 

Residents who choose to pay their taxes with crypto have to go through PayPal so that the payment provider can “deposit dollars into the state’s treasury,” according to a tweet from Polis’ Twitter account last year.

“Our budget is still in dollars, our expenditures are still in dollars, and, of course, we don’t want to take the speculative risk of holding crypto, so we will be having a transactional layer there,” Polis said in an ETHDenver conference last February. “It will be entering our systems as dollars. For consumer convenience, we want to accept payments in a wide variety of cryptocurrencies.” 

And there are fees that are tied to paying with crypto — similar to the fees associated with paying by credit card. Transactions have a fee of $1, as well as 1.83% of the total, according to the Department of Revenue. 

Not to mention that residents may be taxed for using the crypto if the crypto used–PayPal currently supports bitcoin, ethereum, litecoin and bitcoin cash–has gone up in price since the resident bought it thanks to capital gains taxes.

Polis has been a supporter of blockchain technology for a number of years. In 2019, he signed an act called the Cryptocurrency Exemption Colorado Digital Token Act, which “provides limited exemptions from the securities registration and securities broker-dealer and salesperson licensing requirements for persons dealing in digital tokens”

Colorado’s Department of Revenue did not immediately respond to a request for comment.

Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the On the Margin newsletter.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.


Upcoming Events

Salt Lake City, UT

MON - TUES, OCT. 7 - 8, 2024

Blockworks and Bankless in collaboration with buidlbox are excited to announce the second installment of the Permissionless Hackathon – taking place October 7-8 in Salt Lake City, Utah. We’ve partnered with buidlbox to bring together the brightest minds in crypto for […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research



Aerodrome is a "MetaDEX" that combines elements of various DEX primitives such as Uniswap V2 and V3, Curve, Convex, and Votium. Since its launch on Base, it has become the largest protocol by TVL with more than $495B in value locked, doubling Uniswap's Base deployment.


Securitize CEO Carlos Domingo thinks BUIDL will potentially hit its next $500 million milestone in just a few months


Representatives on Thursday opted to back President Biden and uphold his veto of the legislation that sought to invalidate SAB 121


The former Valkyrie CEO chats with Blockworks about what she has her eye on as Cypherpunk Holdings’ new leader


Thursday’s CPI report shows prices are coming down more quickly than analysts had anticipated, renewing hope that central bankers will cut rates in the fall


If we tokenize all assets in a speculative rush, the risk of creating illiquid markets and trapped value will manifest on a large scale


Plus, Trump is headed to the heart of Bitcoinlandia with a speaking appearance at the Bitcoin 2024 conference