El Paso County imposes a Use tax on the privilege of using, storing, distributing or consuming tangible personal property within the county when no sales tax was paid at the time of purchase. This tax complements sales tax and ensuring tax is properly collected based on where the item is used, regardless of where it was purchased.
Use Tax Information
Use Tax: Construction Materials and Motor Vehicles
Construction Materials
El Paso County’s use tax applies to all building and construction materials used within the county, regardless of where the supplier is located. All such materials that become part of real property during a construction project are subject to use tax.
Motor Vehicles
El Paso County also collects use tax on motor vehicles that are registered in the county and were purchased without sales tax. This commonly includes vehicles vehicles bought out of state or through private sales.
For more information, please refer to the El Paso County Motor Vehicle Taxes & Fees
Definition of "Construction & Building Materials"
Any tangible property that is stored, used, or consumed in El Paso County and becomes part of, or attached, or component to:
- Buildings
- Structures
- Roads
- Appurtenances
Remember: If no sales tax was collected at purchase, you are responsible for paying El Paso County Use Tax.
Permitted Projects Use Tax Collection
Whenever a building permit is issued by the Pikes Peak Regional Building Department (PPRBD) for construction-related projects within the jurisdiction of El Paso County, the permit applicant is required to select one of the following payment methods, the Project Material Valuation Method or the Project Affidavit Method, to ensure proper remittance of the El Paso County Use Tax.
Expand the boxes below to view the two payment options
Payment Option 1
Permit applicants who select the Material Valuation Method will have an estimated Use Tax amount collected at the time the permit is issued. This estimate is based on the assumption that 40% of the total permitted project valuation represents the cost of building and construction materials. The El Paso County Use Tax rate of 1.23% is applied to that estimated amount.
Calculation Example:
- Total Permitted Project Valuation: $180,000
- Estimated Material Cost (40%): $72,000
- El Paso County Use Tax (1.23% of $72,000): $885.60
In this example, $885.60 in the Use Tax amount that will be collected at the time of permit issuance, along with the applicable permit fees
Responsibility of Permit Owner
The permit receipt issued by Pikes Peak Regional Building Department (PPRBD) will serve as the Use Tax exemption certificate and must be presented when purchasing building and construction materials from suppliers for this project.
The permit owner is responsible for ensuring that all subcontractors receive a copy of the permit receipt for use when purchasing building and construction materials.
Reconciliation Report
If at the end of project, permit owner believes the material cost for the project is less than the 40% estimated cost using the job material valuation method, they may submit a Reconciliation Report.
- The reconciliation report must include itemized receipts and contract amounts associated with the project.
- The report must be submitted within 180 calendar days of either the issuance of the Certificate of Occupancy or final inspection, whichever occurs later.
- El Paso County will review the report and issue a written determination within 30 calendar days indicating whether a refund will be issued.
- During this 30-day review period, El Paso County may request additional documentation or receipts from the permit owner or subcontractors.
Payment Option 2
Permit applicants who select the Affidavit Method agree that, upon issuance of permit by Pikes Peak Regional Building Department (PPRBD), they are responsible for ensuring that all applicable El Paso County Use Taxes are properly paid regardless of where construction and building materials are purchased for this permitted project.
It is understood that all applicable County Sales and Use Taxes will be paid by the permit applicant.
Responsibility of Permit Owner as part of this agreement:
- The permit owner shall maintain records demonstrating payment of the applicable County Sales and Use Taxes on any construction and building materials purchased for project.
- The permit owner agrees any construction or building materials purchased without payment of El Paso County Sales Tax are subject to Use Tax, which must be reported and remitted directly to El Paso County using a separate Consumer Use Tax Remittance Form for each permitted project.
- The permit applicant further acknowledges and agrees that they may be subject to audit by El Paso County to verify tax compliance and recordkeeping.
Non-Permitted Projects Use Tax Collection
Consumer Use Tax is due to El Paso County when no sales tax was paid at the time construction and building materials were purchased from a retailer, and no use tax was prepaid when the building permit was obtained through the Pikes Peak Regional Building Department (PPRBD).
New Electronic Filing and Payment Option Available
We are excited to announce that starting with the reporting period of September 2025 (due October 20, 2025), taxpayers who fall into this scenario can file their Consumer Use Tax Return electronically and make secure payments online through Point & Pay, our trusted payment processor.
To begin, please read the Instructions for the Consumer Use Tax Form (dated 9-20-2025) thoroughly before completing your consumer use tax return.
If you choose to file electronically, please click the button below to:
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Access the updated form
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Submit your return electronically
- Remit Use Tax amount due electronically
If you prefer, you may also print the form and mail it along with a check.
Use Tax Exemption
El Paso County recognizes and accepts the State Contractors Exempt certificates (State Form DR 0172, commonly referred to as “#89 Certificate”) for construction projects on properties holding tax-exempt status. This includes projects such as affordable housing, tax-exempt charitable organizations, government facilities, schools, and churches. Qualifying projects may be eligible for sales and/or use tax exemption on materials and supplies used on project.
Please complete the Use Tax Exemption Request Form and submit via email to UseTax@elpasoco.com to obtain El Paso County exemption letter. This letter must be presented to Pikes Peak Regional Building Department prior to issuance of the building permit.
Use Tax Audit and Penalty Interest
All related construction records are subject to audit by the County following project completion. Such an audit is designed to determine the actual taxable cost of the project and may be conducted any time within 18 months after the Certificate of Occupancy or final inspection, whichever occurs later. The audit will reconcile the Use Tax deposit paid against the actual tax due on the materials. It is important that you keep complete and accurate records of each project. A copy of the contract including change orders, all invoices, receipts, and cost reports pertaining to the construction project shall be kept for at least (3) years after the certificate of occupancy or final inspection, whichever occurs later.
El Paso County uses a third party auditing firm, Revenue Recovery Group.
If a formal audit by the County or our auditing from reveals an underpayment of the Use Tax, the remainder of the unpaid Use Tax, along with any interest and penalties, will be assessed to the permit applicant.
If it is found when audit is performed by the County or our auditing firm that a refund is do to contractor El Paso County will initiate that payment to the contractor.
The interest and penalty interest rate for underpayment of the amount due and owing Use Tax (“Underpayment”), regardless of the method of payment chosen, will be paid by the customer to the County. The amount of the underpayment shall be the same as allowed under §39-26-207, C.R.S., 2008, as amended. The amount of interest shall accrue from the date due, which is the date Certificate of Occupancy is issued or final inspection, whichever occurs later, and shall continue to accrue until paid. Upon written notification by the County of the amount of the underpayment, the customer may immediately pay the amount of the underpayment to stop interest from accruing while an appeal is undertaken.