Taxpayer Disclosure of Reportable and Listed Transactions
39-22-653
1) Content of Disclosure of Federal Transactions.
A taxpayer who is required to disclose to the department a Federal Transaction shall filewith the Department a copy of the entire IRS form 8886, or any successor form, and anyamendments to the original filing of said form, that the taxpayer files, or should have filed, with the Internal Revenue Service.
2) Content of Disclosure of Colorado Listed Transactions.
A taxpayer who is required to disclose to the department a Colorado Listed Transactionshall file with the department a Taxpayer’s Colorado Listed Transaction DisclosureStatement. The contents of the statement shall include the name and address (mailing and physical location) of each Captive Entity, the name and address (mailing and physical location) of the Owner, the Captive Entity’s estimated total assets and estimated total income earned prior to dividend distribution for the tax year in which the disclosure is first due. A taxpayer who is required to disclose a transaction that is reportable underboth subsections 1 and 2 of this regulation shall file IRS form 8886.
3) Disclosure by a Pass-through Entity or More Than Fifty Percent Owner.
A taxpayer who is (a) a partner, member, or shareholder (a “pass-through member”)of a pass-through entity, (b) a Captive Entity, or (c) an entity controlled by the more than fifty percent beneficial owner of a Captive Entity, and who isrequired to file a disclosure statement pursuant to subsection 1 or 2, above, satisfies its disclosure obligation if the pass-through entity or more than fifty percent beneficial owner is required to disclose under subsection 1 or 2 of this regulation, files on behalf of such taxpayer an Internal Revenue Service form 8886 or a Taxpayer ColoradoDisclosure Statement, as the case may be, that contains all information that wouldhave been disclosed had the pass-through member, Captive Entity,or entity controlled by the more than fifty percent beneficial owner, filed such a disclosure statement, and the taxpayer does not have reasonable grounds tobelieve that the disclosure filed on its behalf is not materially incomplete or inaccurate.
a) Known or Potential Federal Tax Benefits of pass-through members. A pass-through entity that does not know the federal tax benefit that inures to the pass-through member has adequately disclosed a pass-through member’s federal tax benefit if the pass-through entity discloses the potential federal tax benefit(s) that may inure to the pass-through member. If the pass-through entity does not have sufficient information on which to disclose the potential federal tax benefit, the pass-through entity cannot file a disclosure statement on behalf of such pass-through member. This subsection 3(a) does not apply to an Owner, Captive Entity, or a taxpayer listed in subsection 4, below, because the taxpayer in such cases is presumed to have access to the information necessary to disclose the known tax benefit of those other entities on behalf of whom the disclosure statement is filed.
4) Taxpayer included in a Colorado combined report or consolidated return.
A taxpayer that is included, or are required to be included, in a combined and/orconsolidated Colorado income tax return and that is required to make a disclosureunder subsections 1 or 2, above, satisfies the disclosure requirements of this regulation ifan IRS form 8886 or Colorado Taxpayer Disclosure Statement, as the case may be, thatcontains all information that would have been disclosed had the taxpayer separately filed such disclosure statement, is filed with the combined and/or consolidated return onbehalf of all such taxpayer.