Live in Colorado, Work in Wisconsin: Which State Taxes Your Paycheck?
Answer
You file twice: Wisconsin first, then Colorado. There is no reciprocity agreement between these two states, so Wisconsin taxes the income where it was earned and Colorado taxes it again as resident income — with the resident credit removing the double charge rather than an exemption form preventing it.
Last verified
Without an agreement between Colorado and Wisconsin, the overlap is handled after the fact rather than prevented. That is why the filing order matters: the Wisconsin figure is an input to the Colorado return, so completing Colorado first means doing it twice.
A Colorado resident taxed by another state on the same income claims the credit for taxes paid to other states on Form DR 0104CR. The credit is capped at the Colorado tax on that income, so it removes the double tax but never refunds the excess when the other state charges more.
What you file
- 1Nonresident return · WisconsinForm 1NPR
File the Wisconsin nonresident return FIRST — you need the Wisconsin tax figure before you can complete Colorado.
- 2Resident return · ColoradoForm DR 0104CR
File a Colorado resident return reporting all income, then claim the credit for tax paid to Wisconsin. The credit is capped at what Colorado would have charged on that same income, so if Wisconsin taxes it at a higher rate the difference is not refunded.
The two states, side by side
| Colorado | Wisconsin | |
|---|---|---|
| Taxes wages | Yes — flat | Yes — graduated |
| Reciprocity partners | None | 4 (Form W-220) |
| Convenience rule | No | No |
| Nonresident return | Form DR 0104 with Schedule DR 0104PN | Form 1NPR |
| Credit for other-state tax | Form DR 0104CR | Schedule OS |
| Nonresident safe harbour | None published | Dollar floor published |
| Local income tax | Yes | No |
| Revenue department | Colorado Department of Revenue — Taxation Division | Wisconsin Department of Revenue |
| Last verified |
The other direction
Reversing the commute does not always reverse the answer. Living in Wisconsin and working in Colorado gives:Both states — credit offsets the double tax.
Same two states, different situation
The withholding answer turns on how you are paid and where the work happens, not only on which two states are involved.
- Remote worker: Colorado → WisconsinHome state only
- 1099 contractor: Colorado → WisconsinHome state, plus the client state if you work there
- Moved mid-year: Colorado → WisconsinTwo part-year returns
Other Colorado pairs
Questions people actually ask
I live in Colorado and work in Wisconsin. Which state takes the tax out of my paycheck?
You file twice: Wisconsin first, then Colorado. There is no reciprocity agreement between these two states, so Wisconsin taxes the income where it was earned and Colorado taxes it again as resident income — with the resident credit removing the double charge rather than an exemption form preventing it.
Which state should my employer be withholding for?
Wisconsin. The wages are sourced to Wisconsin, so Wisconsin withholding is correct and there is no Colorado withholding to set up.
Will I end up paying tax twice on the same income?
Not twice over, but you will pay the higher of the two rates. Colorado gives residents a credit for tax paid to Wisconsin on the same income, claimed on Form DR 0104CR. The credit is capped at the Colorado tax on that income, so if Wisconsin taxes it more heavily the excess is not refunded by either state.
How current is this?
The Colorado and Wisconsin rules on this page were last checked against Colorado Department of Revenue — Taxation Division and Wisconsin Department of Revenue on 2026-08-07. We re-check the full grid every December after state legislative sessions close, and re-check the convenience-of-the-employer states quarterly because that is where the rules move fastest.
Sources
Every fact above comes from the revenue department that publishes the rule. We do not cite secondary summaries, and we do not restate a figure we could not find at source.
- Colorado Department of Revenue — Taxation Division — individual income taxaccessed 2026-08-07
- Wisconsin Department of Revenue — individual income taxaccessed 2026-08-07