The Master Settlement Agreement (MSA) is an agreement between 46 states, the District of Columbia, as well as five territories and the major tobacco companies to settle lawsuits over Medicaid costs in the treatment of smoking related illnesses. Go to Forms & Instructions | Cigarette, Nicotine Products, & Tobacco Products Tax to download the forms listed on this page. All MSA reporting is submitted by email to the Excise Tax Unit.
Colorado cigarette and tobacco product distributor licensees are required to submit MSA reporting. Monthly reporting on form DR 1285 or yearly reporting on form DR 1286 must be received for any month the license is active.
If a cigarette or tobacco products distributor licensee or applicant meets any of the following criteria, they can file the Annual Exemption from Monthly Non-Participating Manufacturer Brands Reporting, DR 1286, on an annual basis:
- Cigarette distributor stamps and distributes in Colorado only cigarette brands manufactured by participating manufacturers.
- Cigarette distributor only purchases stamped cigarettes from another Colorado cigarette distributor to sell to Colorado retailers.
- Tobacco products distributor sells at wholesale or retail in Colorado only tobacco products not subject to the Master Settlement Agreement (i.e. cigars, pipe tobacco, chew, etc.).
Monthly MSA Reporting Requirements
If a cigarette or tobacco products licensee does not meet any of the criteria for a yearly exemption from monthly MSA reporting, the Non-Participating Manufacturer (NPM) Brands Reporting Form, DR 1285, will be required to be filed on a monthly basis.
Each licensed cigarette and tobacco products distributor is required to file monthly a Non-Participating Manufacturer Brands Reporting Form, DR 1285, if:
- Selling NPM manufactured cigarettes in Colorado and affixing the Colorado cigarette tax stamp; or
- Selling tax paid NPM manufactured RYO in Colorado; or
- Selling tax exempt NPM cigarettes and RYO in Colorado; or
- Transferring any NPM cigarettes or RYO to another distributor/wholesaler within Colorado; or
- Exporting any NPM cigarettes and RYO to another distributor/wholesaler outside of Colorado.
Form DR 1285 is required beginning with the first month the NPM brands stamped for Colorado are sold, sold tax exempt, transferred within Colorado, or exported outside of Colorado.
MSA Reporting for Cigarette and Tobacco License Applicants
Refer to the previous section to determine whether you will be required to submit monthly MSA reporting DR 1285 or whether you can file a yearly exemption form DR 1286. If you meet the exemption criteria, please note that the DR 1286 form is effective the month after which it is received by the Excise Tax Unit. If you are submitting a cigarette or tobacco products application for a license start date in the current month, you will need to provide a monthly DR 1285 reporting form for the current month along with the DR 1286 form.
For additional information regarding the Master Settlement Agreement, visit the National Association of Attorneys General website.