Source: https://cbaclelegalconnection.com/tag/colorado-department-of-revenue/
Timestamp: 2019-04-18 14:54:13+00:00

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The Colorado Court of Appeals issued its opinion in Colorado Department of Revenue v. Astro Imports, Inc. on Thursday, February 25, 2016.
Used Car Dealership—Revocation of License—Failure to Disclose Damage—Evidence—Willful Misrepresentation—Arbitrary and Capricious.
Astro Imports (Astro) was a used car dealership licensed to do business by the Colorado Motor Vehicle Dealer Board (Board). The Board revoked Astro’s used motor vehicle dealer license for failing to disclose to buyers the damage to vehicles that had been disclosed to Astro in deal jackets. This disclosure documentation had been provided by the auction house to Astro.
On appeal, Astro contended that because none of the buyers testified that the vehicles actually sustained any of the damage reflected in the disclosure documents, no buyer suffered damage under CRS § 12-6-118(3)(e). While vehicle damage may provide one basis for finding that a person suffered damage under the statute, it is not the only way to establish such damage, and proving vehicle damage is not required. Accordingly, Astro’s contention that proof of actual vehicle damage was required for the Board’s finding of damage was rejected.
Astro also contended that the Board’s action was arbitrary and capricious because the record lacked substantial evidence to support its findings. Astro did not contest the evidence contained in the deal jackets showing that it had properly received notice of damage to the vehicles that it had purchased, and there was sufficient evidence that Astro defrauded its customers by failing to provide this information to the buyers.
Astro further contended that the Board’s action was arbitrary and capricious because the record lacked substantial evidence that Astro failed to disclose material damage in writing to its customers in violation of CRS § 6-1-708(1)(b). However, substantial record evidence showed that Astro failed to provide written disclosures of previous damage before selling used cars to its customers. Furthermore, the absence of actual damage at the time of Astro’s sale to the buyer is irrelevant because the disclosure documents show that damage previously existed. The evidence showed that Astro knew of its legal duty to disclose the previous damage on resale and established that its conduct was willful. Accordingly, substantial evidence supported the finding that Astro engaged in deceptive trade practices.
The Board’s order was affirmed.
The Colorado Court of Appeals issued its opinion in Creager Mercantile Co., Inc. v. Colorado Department of Revenue on Thursday, February 12, 2015.
Creager Mercantile Company, Inc. (Creager) is a distributor of groceries, tobacco, and other products to convenience stores. In 2003, Creager began distributing Blunt Wraps, which are rolling papers consumers can use to roll their own cigars or cigarettes. Blunt Wraps are made from homogenized tobacco leaves and contain between 30% and 48% tobacco. Although the Colorado Department of Revenue (DOR) did not previously assess tax on these products, it audited Creager and assessed tax on the Blunt Wraps for tax years 2004–06. Creager appealed to the district court, and the district court affirmed the DOR’s final determination that Creager is liable for certain taxes on tobacco products.
On appeal, Creager claimed that the district court erred in holding that Blunt Wraps are “tobacco products” within the meaning of CRS § 39-28.5-101(5). Blunt Wraps are not specifically listed in the statute, and the statute’s phrase “other kinds and forms of tobacco, prepared in such manner as to be suitable for chewing or for smoking in a pipe or otherwise” is ambiguous. The listed products include several varieties of cigars, chewing tobacco, and forms of tobacco generally consumed by smoking in a pipe or hand-rolled cigar or cigarette. Each of the products on the list is a focus of consumption; absent are products that, like Blunt Wraps, contain some tobacco but are only suitable for consuming other products. Therefore, Blunt Wraps are not “tobacco products” within the meaning of CRS § 39-28.5-101(5), and the district court erred in affirming the tax assessment related to Blunt Wraps. The judgment was reversed and the case was remanded with directions.
The Colorado Court of Appeals issued its opinion in Markus v. Brohl, Exec. Dir. of Colorado Department of Revenue on Thursday, October 23, 2014.
Conservation Easement Tax Credits—Review Period by Department of Revenue—Summary Judgment.
In 2004, three pairs of landowners created conservation easements (CEs) on their lands, had them appraised, and sold them to the Otero County Land Trust for a portion of their appraised value. They applied part of the CE tax credits to their 2004 income tax liability. The landowners (CE donors) carried forward the remainder of the CE credits, some for personal use and some for the use of third parties.
On September 28, 2009, the Colorado Department of Revenue (Department) disallowed the entire CE tax credit of one pair of landowners because of a purported deficiency in the appraisal. For the same reason, in April 2010, the Department disallowed the claims of CE tax credits of the each of the second pair of landowners. The disallowances, under a four-year limitations period, affected only the donors’ use of claimed CE credits in the 2005–08 tax years.
On cross-motions for summary judgment, the CE donors argued that the four-year limitations period had expired before the Department acted to disallow their tax credits. The Department argued that the limitations period commenced each time a CE donor or transferee applied a CE tax credit to his or her tax liability and that it could evaluate the original claims for purposes of disallowing the use of credits for the 2005–08 tax years. The district court entered summary judgment in favor of the CE donors.
On appeal, the Department argued that the district court erred in its limitations determination, and that there was a genuine issue of material fact precluding summary judgment as to whether the CE donors had filed false or fraudulent tax returns. The Court of Appeals found that the applicable general statute of limitations was four years, and the time period commenced at the filing of a tax return. Under this system, the Court was inclined to side with the Department.
However, CRS § 39-22-522 specifically addresses the tax consequences of a CE. Under that statute, claimed CE tax credits may be transferred to third parties, who are then bound by “the same statute of limitations” as the CE donor. The Court supported an interpretation where a purchaser–transferee would have a low risk of disallowance of the CE credits by the Department. Here, because the Department did not challenge the validity and value of the CE tax credits prior to April 15, 2009, it was barred from disallowing them.
The Department also argued that there was a genuine issue of material fact as to whether the CE donors filed false or fraudulent tax returns that precluded summary judgment. After reviewing the record, the Court found no genuine dispute of any material fact. The judgment was affirmed.
The Colorado Court of Appeals issued its opinion in Pioneer Natural Resources USA, Inc. v. Colorado Department of Revenue on Thursday, August 14, 2014.
In this sales tax case, the district court concluded that the pipelines and fittings at issue, which are located in one of Colorado’s enterprise zones and are used to gather and deliver natural gas from plaintiff’s wells to its processing facilities, qualify for Colorado’s sales tax exemption because they “are in direct use in the manufacturing of natural gas,” as defined in CRS §§ 39-26-709 and 39-30-106. The Colorado Department of Revenue (DOR) appealed, contending that the district court erred in finding that plaintiff’s purchases qualify for this tax exemption.
The parties agreed that plaintiff’s wells and gas-gathering system are located within an enterprise zone. Under the enterprise zone sales and use tax exemption statute, purchases of “machinery or machine tools” in excess of $500 are exempt from sales tax if they are “used solely and exclusively in an enterprise zone in manufacturing tangible personal property, for sale or profit. . . .” Here, the pipelines are used to “move material from one direct production step to another in a continuous flow,” and the enterprise zone exemption statute considers both “extracting” and “processing” as manufacturing. Thus, plaintiff’s pipelines and fittings that move natural gas from the wells—a direct production step of extracting natural gas—to the processing facilities in a continuous flow qualify for Colorado’s sales tax exemption because they “are in direct use in the manufacturing of natural gas.” Therefore, the district court did not err in finding that plaintiff’s purchases qualified for Colorado’s sales tax exemption. The judgment was affirmed.
The Colorado Department of Revenue has released the cost of living adjustment (COLA) figures for 2014 for probate matters. The cost of living adjustments are required by C.R.S. § 15-10-112. Trust and estate practitioners should be aware of the new figures, which affect decedents’ estates, elective shares, exempt property under C.R.S. § 15-11-403, lump sum distributions of family allowances, and collection of personal property by affidavit.
The Colorado Department of Revenue released its 2013 Cost of Living Adjustment (COLA) figures for certain amounts in the Colorado Probate Code, as required by C.R.S. § 15-10-112. The COLA figures affect decedents’ estates, elective shares, exempt property under C.R.S. § 15-11-403, lump sum distributions of family allowances, and collection of personal property by affidavit. Trust and estate practitioners should be aware of the new figures.
On Wednesday January 9, 2013, Sen. John Kefalas introduced SB 13-004 – Concerning Authorization to Renew a State-Issued Identification Card by Electronic Means. This summary is published here courtesy of the Colorado Bar Association’s e-Legislative Report.
The bill authorizes a person over 65 years of age to electronically renew an identification card issued by the department of revenue. Assigned to the Local Government Committee.
On Election Day, the voters of Colorado made history with the passage of Amendment 64—the Regulate Marijuana Like Alcohol Act of 2012.
Amendment 64, which received 55% of the vote, legalizes marijuana under Colorado law for adults over the age of 21. Specifically, it removes all civil and criminal penalties under Colorado law for the limited possession, use, and cultivation of marijuana by adults over the age of 21. This measure also requires the Colorado Department of Revenue to create a regulatory system for the production and distribution of marijuana in a manner similar to alcohol.
The passage of Amendment 64 made waves across the world and made headlines from England to India. Just this week, a handful of Latin America leaders called for a review of international drug policy in light of these measurers passing. Politically, the 10 point passage of Amendment 64 has prompted other states to consider similar measures, and has even spurred bi-partisan action by Colorado’s congressional delegation to exempt states’ marijuana laws from the federal Controlled Substance Act.
This historic victory also made waves here in Colorado. Colorado Governor Hickenlooper’s responded with his now infamous comments, telling voters not to “break out the Cheetos” yet because marijuana remains illegal federally. The Governor’s comments hinted at a lack of interest in fighting on behalf of Colorado voters and led many to wonder what, if any, effect Amendment 64 will have here at home.
The state vs. federal nature of this law change will continue to be of great interest to both legal scholars and voters. A full analysis of this issue will be saved for another post, but to be clear, the federal government cannot force our state to criminalize anyone – including those who use or produce marijuana.
The removal of criminal penalties for adults using, possessing and cultivating marijuana goes into effect once the election is certified (probably sometime around January 6th), although retail stores won’t be able to open until late 2013 or early 2014.
We still have time before the measure goes into effect, but already, Amendment 64 is making ripples in our communities. This week both the Boulder District Attorney and the Denver District Attorney announced they will dismiss all marijuana charges related to actions that would have been protected by Amendment 64. In the interest of justice, we hope more District Attorneys follow suit. According to long standing Colorado law, a change in a criminal law that reduces a sentence or eliminates the violation all together should apply retroactively in the interest of justice to all convictions not yet final. C.R.S. § 18-1-410(1)(f); Colo. Crim. P. Rule 35; People v. Thomas, 185 Colo. 395 (1974). Even if a stubborn district attorney was lucky enough to convict an adult for possessing marijuana now, the case should be dismissed by the trial judge or on appeal once Amendment 64 goes into effect.
Although Amendment 64 is not yet in effect, for the adults currently caught in the system for marijuana offenses, the ripples of last Tuesday are already being felt.
Joshua Kappel, Esq. is the Associate Director of Sensible Colorado, the leading state-wide non-profit working to educate the public about sensible marijuana policy. Mr. Kappel is also the senior associate at Vicente Sederberg, the first nation-wide medical marijuana law firm.The opinions and views expressed by Featured Bloggers on CBA-CLE Legal Connection do not necessarily represent the opinions and views of the Colorado Bar Association, the Denver Bar Association, or CBA-CLE, and should not be construed as such.

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