Due to the recent Town of Eagle sales tax increase (from 4% to 4.5% on July 1, 2016), we have found it necessary to modify our Use Tax procedures for accounting purposes. There is no change in how the Town calculates and collects use tax (the use tax calculation assumes that 50% of the total construction cost is related to materials used in the construction or modification of a building and is collected at the time of building permit application). Until now, practice has been that materials distributors within the Town of Eagle have exempted contractors from town sales tax upon presenting a Sales Tax Exemption Certificate. Due to the sales tax increase, and in order to properly account for the additional 0.5%, local suppliers will no longer exempt town sales tax for building materials.
The process for reconciling sales tax and use tax has not changed: upon completion of construction, the owner may submit (copies of) receipts for materials that are physically part of the structure (wood, nails, carpet, windows, shingles, etc.). Town Staff will calculate the total amount of town/city sales tax that was paid for each purchase and reimburse the owner up to 4% sales tax, not to exceed the total amount of use tax paid to the Town.
Use Tax Refund Instructions
Any city Sales Tax within the State of Colorado can be refunded if it was paid when you purchased your materials. No state or county taxes can be refunded.
The Town of Eagle's Use Tax rate is 4%. City Sales Tax can be refunded up to 4%. Anything over 4% can not be refunded.
Sales Tax rates are as follows: State: 2.9%,Eagle County: 1.5% (Total of 4.4%), Town of Eagle: 4.5%
If the tax paid is equal to or less than 4.4%, then no city sales tax was paid.
Items that are physically part of the house can count towards a refund, such as: wood, nails, carpet, windows, shingles, etc.
Example of items that can not be refunded are: appliances, equipment rental, tools, utilities, permit sign, landscaping, etc.
Make a copy of your receipts (you keep the originals) of building materials and bring them to the Eagle building department to calculate your refund.
Refund checks are mailed out the day of the first Town Board meeting of the month (Second Tuesday of the month).
Use Tax Refund Receipt Examples
Highlighted items can be refunded. Crossed out items can not be refunded.