Does Colorado follow the federal no-tax-on-tips and overtime deductions?

SPLIT (tips conform; overtime conforms 2025 only)

Colorado's position is split — by deduction, by tax year, or both. Read the per-deduction table and the state's own words below carefully before assuming either deduction applies to your state return. The federal deduction on Schedule 1-A is separate and unaffected.

Verified against the official state source below — last verified October 26, 2026

What the state itself says

Tips — "No addback is required on the taxpayer's Colorado return for any deduction claimed on their federal return for qualified tips." Overtime — "For tax years 2026 and later, an individual who claims a deduction for overtime compensation on their federal income tax return must add back…"

Official source

Colorado Department of Revenue, "Individual Income Tax Guide" (revised January 2026)

Tax years covered

Tips: no addback in any year. Overtime: flows through for 2025; full addback for TY2026 and later.

Colorado starts from federal **taxable income**, so both deductions initially flowed through automatically; the legislature decoupled overtime only via HB 25-1296 (new C.R.S. §39-22-104(3)(u)), leaving tips untouched.

Your federal deduction is separate

Whatever your state does, the federal deductions run on their own rules: check your W-2 codes with the W-2 Code Checker, estimate with the Tips Calculator and Overtime Calculator, and see the glossary for any term. All state positions: the state-by-state index.

State position verified October 26, 2026 from the official source above. State guidance changes; confirm on the source before filing. This page is general information, not tax advice.