Unauthorized alien labor services

Individuals must make an addition on their Colorado income tax returns for any business expenses deducted in the calculation of federal taxable income for wages or remuneration paid to an unauthorized alien for the physical performance of services in Colorado. An individual is not required to make any addition if:

the business did not know of the unauthorized status of the worker at the time of hiring; or

the business is domiciled in Colorado and is exempt from compliance with federal employment verification procedures under federal law that makes the employment of unauthorized aliens unlawful. Furthermore, the addition is not required if the worker:

was lawfully admitted to the United States for permanent residence;

was authorized to work in the United States by Chapter 12 of Title 8 of the U.S. Code or by the U.S. Attorney General;

was paid less than $600 in wages or remuneration for the year;

was hired by the business prior to December 31, 2006;

was not directly compensated or employed by the business; or

holds and presents to the business a valid license or identification card issued by the Colorado Department of Revenue.