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Second Regular Session
Seventy-fifth General Assembly
STATE OF COLORADO
INTRODUCED
LLS NO. 26-0465.03 Jed Franklin x5484 HOUSE BILL 26-1289
House Committees Senate Committees
Finance
A BILL FOR AN ACT
CONCERNING MODIFICATION OF CERTAIN TAX EXPENDITURES.101
Bill Summary
(Note: This summary applies to this bill as introduced and does
not reflect any amendments that may be subsequently adopted. If this bill
passes third reading in the house of introduction, a bill summary that
applies to the reengrossed version of this bill will be available at
http://leg.colorado.gov.)
The bill adjusts several state tax expenditures as follows:
! Section 2 of the bill prohibits certain local use tax
ordinances, resolutions, or proposals from applying to
construction and building materials used by a common rail
carrier pursuant to a contract with the state, a political
subdivision of the state, or a special district allows the
contracting government to use the carrier's property or
tracks for the provision of public passenger rail service;
HOUSE SPONSORSHIP
Garcia and Brown,
SENATE SPONSORSHIP
Weissman,
Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment.
Capital letters or bold & italic numbers indicate new material to be added to existing law.
Dashes through the words or numbers indicate deletions from existing law.
! Section 3, for income tax years commencing on and after
January 1, 2027, requires a taxpayer to add to the taxpayer's
federal taxable income the excess of any gain excluded
from federal gross income pursuant to section 1400Z-2
(a)(1)(A) of the internal revenue code over the gain
invested by the taxpayer in a Colorado-qualified
opportunity fund in a manner that qualifies for exclusion
from federal gross income pursuant to the same section of
the internal revenue code;
! Section 4, for income tax years commencing on and after
January 1, 2027, creates an income tax credit for certain
individuals who are 65 years old or older in the income tax
year, or who are a surviving spouse of that individual, and
who were previously eligible to receive a grant for real
property tax assistance and heat or fuel expenses
assistance;
! Section 5, for income tax years commencing on or after
January 1, 2027, allows a combined group to elect to make
a water's-edge filing election and describes what should be
taken into account in such a filing;
! Section 6, for income tax years commencing on or after
January 1, 2027, repeals the state corporate income tax
deduction for wages or salaries paid that are not allowed to
be deducted at the federal level pursuant to section 280C of
the internal revenue code;
! Section 6, for income tax years commencing on or after
January 1, 2027, also eliminates the ability of corporations
to deduct from their income tax liability any amount
included in federal taxable income pursuant to sections 951
(a) or 951A (a) of the internal revenue code with respect to
a controlled foreign corporation incorporated in a foreign
jurisdiction for the purpose of tax avoidance;
! Sections 7, 12, and 13 eliminate a potential reduction in the
amount available for the innovative motor vehicle tax
credit, the heat pump technology and thermal energy
network tax credit, and the electric bicycle tax credit,
respectively, based on an economic forecast by the office
of state planning and budgeting or legislative council staff;
! Section 7 also increases the innovative motor vehicle tax
credit from $1,000 to $2,000 for certain vehicles sold or
leased during the 2027 income tax year, and from $500 to
$1,000 for certain vehicles sold or leased during the 2028
income tax year. Currently, an additional $2,500 in tax
credit is allowed for certain vehicles sold or leased on or
after January 1, 2024, but prior to January 1, 2029, that
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have a manufacturer's suggested retail price (MSRP) below
$35,000. Section 7 provides that certain vehicles with an
MSRP below $40,000 that are sold or leased on or after
January 1, 2027, but before January 1, 2029, are eligible for
the additional tax credit.
! Section 8, for income tax years commencing on or after
January 1, 2027, modifies the income tax credit for wildfire
hazard mitigation expenses by adding the thinning of
woody vegetation that is at risk of mountain pine beetle or
spruce beetle infestation or that has been killed by
mountain pine beetles or spruce beetles to the definition of
"wildfire mitigation measures", modifying the amount of
the credit available, and allowing the credit to be carried
forward for 5 years;
! Section 9, for income tax years commencing on or after
January 1, 2027, expands the income tax credit for the
purchase of small food business recovery grant program
equipment to be available for additional food distributors
and producers, adjusts the amount of the tax credit that may
be offered and claimed for the purchase of small food
business recovery grant program equipment or participation
in the supplemental food assistance benefit program, and
dictates the order in which the department of agriculture
shall award these tax credits;
! Sections 10 and 16 extend the electric powered lawn
equipment tax credit until January 1, 2030, and allow a
retailer to receive quarterly advance payments of the credit;
! Section 11, for income tax years commencing on or after
January 1, 2027, allows an entity not subject to income tax
to be eligible for an income tax credit for developing a
qualified industrial facility, allows a taxpayer to claim the
credit for installing equipment used for utilization of
biomethane, and requires the Colorado energy office
(CEO) to review applications for the credit within 120,
rather than 90, days;
! Section 11 also creates a new tax credit for geothermal
energy projects for income tax years commencing on or
after January 1, 2027. The amount of the credit cannot
exceed $5 million per taxpayer aggregated across all
income tax years for which the credit may be claimed. The
total amount of credits cannot exceed $35 million across all
income tax years commencing on or after January 1, 2027,
but before January 1, 2033.
! Section 14 repeals the sustainable aviation fuel (SAF)
production facility tax credit, effective January 1, 2027;
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! Section 15 establishes the sustainable aviation fuel
purchase income tax credit for income tax years beginning
on or after January 1, 2027, and before December 31, 2032.
The amount of the credit is initially $1.50, increased by
$.01 for each whole percentage of carbon intensity
reduction in excess of 50%, per gallon of SAF purchased
in the state by the taxpayer, and the CEO may adjust that
amount annually. The total amount of credits issued cannot
exceed $3 million per tax year. Taxpayers must apply to the
CEO for a tax credit certificate and CEO verifies eligibility
and reports approved credits to the department of revenue.
The credit is refundable but may not be carried forward.
! Section 17 repeals the precious metal and bullion coins
sales and use tax exemption, effective January 1, 2027;
! Section 18, for tax periods commencing on or after July 1,
2027, exempts from tax the storage, use, or consumption
of construction and building materials by or on behalf of
a common carrier by rail operating in interstate or foreign
commerce when the storage, use, or consumption of the
construction and building materials is pursuant to a
contract with the state, a political subdivision of the state,
or a special district that allows the contracting government
to use the railroad's property or tracks for public passenger
rail service;
! Section 19 reinstates the sales and use tax exemption for
wood from salvaged trees killed or infested in Colorado by
mountain pine beetles or spruce beetles, which would
otherwise expire on June 30, 2026, for a period beginning
on July 1, 2027, and ending June 30, 2032;
! Section 20 repeals the sales and use tax exemption for
property used in space flight, effective January 1, 2027;
! Sections 21 and 22 change from 2% to 1% the allowance
to cover losses in transit and in unloading gasoline or
special fuel and repeals the 0.5% allowance for the costs of
collecting the gasoline or special fuel excise tax and for
uncollectible bad debts for tax periods beginning on or
after January 1, 2027;
! Section 23 repeals the 3% deduction for collecting and
remitting the tax on the inventory of cigarette wholesalers
for tax periods beginning on or after January 1, 2027;
! Section 24 repeals the 0.4% discount on the face value of
tax stamps affixed to packages containing cigarettes for tax
periods beginning on or after January 1, 2027;
! Section 26 repeals the 1.6% discount for expenses in the
collection and remittance of the tax on the sale, use,
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consumption, handling, and distribution of tobacco for tax
periods beginning on or after January 1, 2027;
! Section 27 repeals the 1.1% discount for expenses in the
collection and remittance of the nicotine product
distributors tax for tax periods beginning on or after
January 1, 2027;
! Section 28 allows an income tax credit to a taxpayer who
places a new renewable energy investment in service on or
after January 1, 2027, and provides a 14-year carryover of
any amount of the credit not used to offset the income
taxes otherwise due;
! Section 28 also eliminates the enterprise zone commercial
vehicle tax credit for tax periods beginning on or after
January 1, 2027;
! Section 29 provides that on or after January 1, 2027, a
taxpayer with more than 50 employees during an income
tax year is ineligible for the new enterprise zone business
employee tax credit in that same income tax year;
! Section 30 requires, beginning January 1, 2027, a taxpayer
to make at least $150,000 in expenditures in research and
experimental activities to be eligible for the enterprise zone
research and experimental activities tax credit;
! Section 31 modifies the enterprise zone vacant building
rehabilitation income tax credit so that the credit only
applies to buildings that have been unoccupied for 183 days
preceding when the rehabilitation is placed in service and
is available in an amount equal to 25% of the aggregate
qualified expenditures per building or $200,000 per
building, whichever is less;
! Section 32, beginning January 1, 2027, ends the
availability of grants for real property tax assistance and
heat or fuel expenses assistance; and
! Sections 33 through 39 make conforming amendments for
the changes made in sections 4 and 32.
Be it enacted by the General Assembly of the State of Colorado:1
SECTION 1. Legislative declaration. The general assembly2
finds and declares that:3
(1) (a) Regular evaluation and maintenance of the tax code is4
critical to a high-quality tax system;5
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(b) The office of the state auditor and the general assembly1
regularly review tax credits, deductions, and exemptions, along with other2
tax expenditures, and recommend streamlining implementation, assessing3
ongoing fit with the original purpose, and eliminating outdated or4
ineffective tax expenditures;5
(c) This act is a single tax policy change that makes changes to6
existing tax expenditures and eliminates others to improve the7
administrative efficiency of the tax code, reduce administrative burden,8
better align certain tax expenditures with the general assembly's intent in9
enacting the tax expenditures, and conform Colorado's tax code with10
provisions commonly used in other states so that Colorado is less of an11
outlier compared to the rest of the country in how taxpayers compute their12
taxes owed;13
(d) Any net district revenue gain resulting from the tax policy14
change in this act is incidental and de minimis; and15
(e) Therefore, consistent with the Colorado Supreme Court's16
holding in TABOR Found. v. Reg'l Transp. Dist., 2018 CO 29, that a tax17
policy change that causes either no net district tax revenue gain or a net18
district tax revenue gain that is only incidental and de minimis does not19
require voter approval under section 20 (4)(a) of article X of the state20
constitution, this act is not a tax policy change that requires voter21
approval.22
(2) (a) Currently, the sale and use of precious metal bullion and23
coins are exempt from the state sales and use tax while the sale and use24
of other numismatic items, such as paper money, tokens, checks, and25
wampum, are not.26
(b) Eliminating the sales tax exemption for precious metal bullion27
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and coins serves the purposes of: 1
(I) Creating uniformity of taxation among the items that bullion2
and numismatic dealers sell; and3
(II) Better aligning Colorado's tax code with those of local4
governments, since, according to the office of the state auditor's 20215
evaluation of the tax expenditure, only three of Colorado's fifteen most6
populous home rule cities and counties have this exemption. 7
(c) Any revenue gain realized as a result of eliminating the sales8
tax exemption for precious metal bullion and coins is incidental and de9
minimis.10
(3) (a) Eliminating the administrative and bad debt allowance for11
fuel tax distributors serves the purposes of:12
(I) Reducing a duplicative benefit; and13
(II) Better aligning Colorado's tax code with those of other states.14
(b) According to the office of the state auditor's 2019 evaluation15
of the tax expenditure, the internal revenue service already provides a tax16
offset for bad debt, and most surrounding states don't have a similar tax17
expenditure.18
(c) Any revenue gain realized as a result of eliminating the19
administrative and bad debt allowance for fuel tax distributors is20
incidental and de minimis.21
(4) (a) Eliminating the vendor allowances for the cigarette tax,22
cigarette inventory tax, tobacco products tax, and nicotine products tax23
serves the purpose of:24
(I) Better aligning Colorado's tax code with most other tax codes,25
which don't have similar allowances to reimburse the cost of tax26
collection; and 27
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(II) Removes a redundancy in Colorado's tax code, since1
businesses are already able to deduct these costs from their taxable2
income.3
(b) Any revenue gain realized as a result of eliminating the vendor4
allowances for the cigarette tax, cigarette inventory tax, tobacco products5
tax, and nicotine products tax is incidental and de minimis.6
(5) (a) Eliminating the sales tax exemption for property used in7
space flight better serves the purposes of:8
(I) Aligning the Colorado tax code with those of the vast majority9
of states that don't have a similar tax expenditure; and10
(II) Modernizes Colorado's tax code, since the department of11
revenue's biannual Tax Profile and Expenditure Report shows that12
virtually no taxpayers claim the tax expenditure.13
(b) Any revenue gain realized as a result of eliminating the sales14
tax exemption for property used in space flight is incidental and de15
minimis.16
(6) (a) Eliminating the income tax deduction for wages and17
salaries because of section 280C of the internal revenue code serves the18
purpose of making Colorado's tax code more neutral between taxpayers.19
According to the office of the state auditor's 2019 and 2024 evaluations20
of the tax expenditure, only certain types of expenses and businesses21
qualify for the tax expenditure, which results in Colorado's tax code22
favoring certain types of business activity over others.23
(b) Any revenue gain realized as a result of eliminating the24
income tax deduction for wages and salaries because of section 280C of25
the internal revenue code is incidental and de minimis.26
(7) (a) Reducing the fuel loss deduction tax expenditure from 2%27
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to 1% serves the purposes of:1
(I) Better aligning the tax expenditure with how much fuel2
distributors lose in transit; and3
(II) Removes a redundancy in Colorado's tax code, since4
distributors are already able to deduct these losses from their taxable5
income.6
(b) Any revenue gain realized as a result of reducing the fuel loss7
deduction tax expenditure is incidental and de minimis.8
(8) (a) Restricting the enterprise zone new employee health9
insurance tax expenditure so that it is only available to those businesses10
with fewer than fifty employees serves the purposes of eliminating11
redundancy and better aligning the tax expenditure with the 56th general12
assembly's intent in creating the tax expenditure. The 56th general13
assembly created the tax expenditure to incentivize businesses in14
enterprise zones to offer health insurance to their employees, but, as a15
result of the 2010 passage of the federal "Affordable Care Act", these16
businesses are already required to offer their employees insurance. Any17
revenue gain realized as a result of restricting this tax expenditure is18
incidental and de minimis. 19
(9) Restricting the enterprise zone research and experimental20
income tax credit serves the purpose of better aligning the tax expenditure21
with the 56th general assembly's intent in creating the tax expenditure by22
limiting the tax expenditure to businesses that make the largest and most23
impactful increases in their research and developing spending. Any24
revenue gain realized as a result of restricting this tax expenditure is25
incidental and de minimis.26
(10) (a) The purpose of updating the method for water's-edge27
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combined reporting for future tax years is to better reflect the original1
intent for water's-edge combined reporting, close loopholes, and better2
align Colorado's system of unitary apportionment with federal reporting3
requirements, while fairly apportioning to Colorado its share of4
corporations' income attributable to operations in the state.5
(b) The updates to the method for water's-edge combined6
reporting reflect and strengthens the state's tax policy of water's-edge7
combined reporting. The updates do not change the state's tax policy, is8
not a new tax, and any revenue gain realized as a result of the updates is9
incidental and de minimis.10
(11) The purpose of eliminating the enterprise zone commercial11
vehicle investment tax expenditure is to promote efficiency by removing12
a tax credit that the office of the state auditor's 2020 evaluation of the tax13
expenditure and the department of revenue's biannual review show very14
few taxpayers claim. Any revenue gain realized as a result of eliminating15
this tax expenditure is incidental and de minimis.16
SECTION 2. In Colorado Revised Statutes, 29-2-109, amend17
(1)(j); and add (1)(k) as follows:18
29-2-109. Contents of use tax ordinances and proposals -19
repeal.20
(1) The use tax ordinance, resolution, or proposal of any town,21
city, or county adopted pursuant to this article 2 shall be imposed only for22
the privilege of using or consuming in the town, city, or county any23
construction and building materials purchased at retail or for the privilege24
of storing, using, or consuming in the town, city, or county any motor and25
other vehicles, purchased at retail on which registration is required, or26
both. For the purposes of this subsection (1), the term "construction and27
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building materials" shall not include parts or materials utilized in the1
fabrication, construction, assembly, or installation of passenger tramways,2
as defined in section 12-150-103 (5), by any ski area operator, as defined3
in section 33-44 -103 (7), or any person fabricating, constructing,4
assembling, or installing a passenger tramway for a ski area operator. The5
ordinance, resolution, or proposal may recite that the use tax shall not6
apply to the storage and use of wood from salvaged trees killed or7
infested in Colorado by mountain pine beetles or spruce beetles as8
exempted from the state use tax pursuant to section 39-26-723. The9
ordinance, resolution, or proposal may recite that the use tax shall not10
apply to the storage and use of components used in the pr oduction of11
energy, including but not limited to alternating current electricity, from12
a renewable energy source, as exempted from the state use tax pursuant13
to section 39-26-724. The ordinance, resolution, or proposal may recite14
that the use tax shall not apply to the storage and use of eligible15
decarbonizing building materials, as exempted from the state use tax16
pursuant to section 39- 26-731. The ordinance, resolution, or proposal17
shall recite that the use tax shall not apply:18
(j) To the storage, use, or consumption of any construction and19
building materials required or made necessary in the performance of any20
construction contract bid, let, or entered into at any time prior to the21
effective date of such use tax ordinance, resolution, or proposal; AND22
(k) TO THE STORAGE, USE, OR CONSUMPTION OF CONSTRUCTION23
AND BUILDING MATERIALS BY OR ON BEHALF OF A COMMON CARRIER BY24
RAIL OPERATING IN INTERSTATE OR FOREIGN COMMERCE WHEN THE25
STORAGE, USE, OR CONSUMPTION OF THE CONSTRUCTION AND BUILDING26
MATERIALS IS PURSUANT TO A CONTRACT WITH THE STATE, A DEPARTMENT27
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OR INSTITUTION OF THE STATE , A POLITICAL SUBDIVISION OF THE STATE,1
OR A SPECIAL DISTRICT THAT ALLOWS THE STATE , A DEPARTMENT OR2
INSTITUTION OF THE STATE , A POLITICAL SUBDIVISION OF THE STATE, OR3
A SPECIAL DISTRICT TO USE THE RAILROAD 'S PROPERTY OR TRACKS FOR4
THE PROVISION OF PUBLIC PASSENGER RAIL SERVICE. 5
SECTION 3. In Colorado Revised Statutes, 39-22-104, amend6
(3)(t) and (3)(u); and add (3)(v) and (4)(ff) as follows:7
39-22-104. Income tax imposed on individuals, estates, and8
trusts - single rate - report - tax preference performance statement9
- legislative declaration - definitions - repeal.10
(3) There shall be added to the federal taxable income:11
(t) For income tax years commencing on or after January 1, 2025,12
an amount equal to the amount of employer contribution that an employee13
forfeits pursuant to section 39-22-558 (3)(c) and that the taxpayer had14
previously subtracted from the taxpayer's federal taxable income pursuant15
to subsection (4)(bb) of this section; and16
(u) FOR INCOME TAX YEARS BEGINNING ON OR AFTER JANUARY 1,17
2026, the amount of any overtime compensation excluded or deducted18
from federal gross income INCOME; AND19
(v) (I) F OR INCOME TAX YEARS BEGINNING ON AND AFTER20
JANUARY 1, 2027, THE EXCESS OF ANY GAIN EXCLUDED FROM FEDERAL21
GROSS INCOME PURSUANT TO SECTION 1400Z-2 (a)(1)(A) OF THE22
INTERNAL REVENUE CODE OVER THE AMOUNT OF THAT GAIN INVESTED BY23
THE TAXPAYER IN A COLORADO QUALIFIED OPPORTUNITY FUND IN A24
MANNER THAT QUALIFIES FOR EXCLUSION FROM FEDERAL GROSS INCOME25
PURSUANT TO SECTION 1400Z-2 (a)(I)(A) OF THE INTERNAL REVENUE26
CODE.27
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(II) F OR PURPOSES OF THIS SUBSECTION (3)(v), "C OLORADO1
QUALIFIED OPPORTUNITY FUND" MEANS A QUALIFIED OPPORTUNITY FUND2
THAT HOLDS AT LEAST NINETY PERCENT OF ITS ASSETS IN QUALIFIED3
OPPORTUNITY ZONE PROPERTY. QUALIFIED OPPORTUNITY ZONE PROPERTY4
IS:5
(A) Q UALIFIED OPPORTUNITY ZONE BUSINESS PROPERTY6
SUBSTANTIALLY ALL OF THE USE OF WHICH, DURING SUBSTANTIALLY ALL7
OF THE FUND'S HOLDING PERIOD FOR THE PROPERTY, WAS IN A QUALIFIED8
OPPORTUNITY ZONE WITHIN COLORADO; OR9
(B) Q UALIFIED OPPORTUNITY ZONE STOCK , OR A QUALIFIED10
OPPORTUNITY ZONE PARTNERSHIP INTEREST, IN A QUALIFIED OPPORTUNITY11
ZONE BUSINESS IN WHICH SUBSTANTIALLY ALL OF THE TANGIBLE12
PROPERTY OWNED OR LEASED IS QUALIFIED OPPORTUNITY ZONE BUSINESS13
PROPERTY AS DESCRIBED IN SECTION 1400Z-2 (d)(3)(A)(i) OF THE14
INTERNAL REVENUE CODE AND SUBSTANTIALLY ALL THE USE OF WHICH IS15
IN A QUALIFIED OPPORTUNITY ZONE WITHIN COLORADO.16
(III) FOR PURPOSES OF SUBSECTION (3)(v)(II) OF THIS SECTION:17
(A) P ROPERTY HELD IN THE FUND SHALL BE MEASURED UNDER18
RULES SIMILAR TO THE RULES OF SECTION 1400Z-2 (d)(1) OF THE19
INTERNAL REVENUE CODE; AND20
(B) THE TERMS USED HAVE THE SAME MEANING AS SET FORTH IN21
SECTION 1400Z-2 OF THE INTERNAL REVENUE CODE. 22
(4) There shall be subtracted from federal taxable income:23
(ff) FOR INCOME TAX YEARS COMMENCING ON OR AFTER JANUARY24
1, 2027, THE AMOUNT OF ANY GAIN INCLUDED IN FEDERAL GROSS INCOME25
PURSUANT TO SECTION 1400Z-2 (b) OF THE INTERNAL REVENUE CODE TO26
THE EXTENT THAT SUCH GAIN WAS ADDED TO FEDERAL TAXABLE INCOME27
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PURSUANT TO SECTION 39-22-104 (3)(v) FOR A PRIOR TAX YEAR.1
SECTION 4. In Colorado Revised Statutes, add with amended2
and relocated provisions 39-22-131 as follows:3
39-22-131. [Formerly 39-31-104.5] Tax credit for assistance4
for elderly individuals and individuals with disabilities - tax5
preference performance statement - legislative declaration -6
definitions.7
(1) (a) The general assembly finds and declares that in accordance8
with section 39-21-304, the tax expenditure created in this section is9
intended to reduce net taxes paid by certain individuals. Specifically, the10
tax expenditure is intended to provide assistance through an income tax11
credit for individuals with WHO DO NOT HAVE AN INCOME ABOVE A12
CERTAIN THRESHOLD AMOUNT AND WHO ARE OF A CERTAIN AGE OR HAVE13
a disability. who do not have income above a certain threshold amount14
(b) The general assembly and the state auditor shall measure the15
effectiveness of the tax expenditure in achieving the purpose specified in16
subsection (1)(a) of this section based on the number of taxpayers who17
have claimed the credit and the total amount of credits claimed.18
(2) As used in this section, unless the context otherwise requires:19
(a) "Credit" means the credit against income tax that is created in20
this section.21
(b) "Inflation" means the annual percentage change in the United22
States department of labor, bureau of labor statistics, consumer price23
index for Denver-Aurora-Lakewood for all items and all urban24
consumers, or its successor index.25
(c) (I) "Qualified individual" means a resident individual who has26
a disability during the entire income tax year to a degree sufficient to27
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qualify for the payment to the individual of full benefits from any bona1
fide public or private plan or source based solely upon such THEIR2
disability AND, FOR TAX YEARS COMMENCING ON OR AFTER JANUARY 1,3
2027, A RESIDENT INDIVIDUAL WHO IS SIXTY -FIVE YEARS OLD OR OLDER4
DURING THE INCOME TAX YEAR.5
(II) An individual has a disability for purposes of subsection6
(2)(c)(I) of this section if the individual is unable to engage in any7
substantial gainful activity by reason of any medically determinable8
physical or mental impairment that can be expected to result in death or9
that has lasted for a continuous period of not less than twelve months.10
(d) "SURVIVING SPOUSE" MEANS A RESIDENT INDIVIDUAL:11
(I) WHO IS FIFTY-EIGHT YEARS OLD OR OLDER;12
(II) WHOSE SPOUSE IS DECEASED; OR13
(III) WHOSE SPOUSE WAS A QUALIFIED INDIVIDUAL AS A RESULT OF14
BEING SIXTY-FIVE YEARS OLD OR OLDER DURING THE INCOME TAX YEAR.15
(3) For income tax years commencing on or after January 1, 2025,16
a qualified individual OR, FOR TAX YEARS COMMENCING ON OR AFTER17
JANUARY 1, 2027, A QUALIFIED INDIVIDUAL OR A SURVIVING SPOUSE is18
allowed a credit against the tax imposed by THIS article 22 of this title 3919
in an amount set forth in subsection (4) of this section.20
(4) (a) The credit may be claimed in an amount equal to:21
(I) One thousand two hundred dollars for:22
(A) A qualified individual OR A SURVIVING SPOUSE filing a single23
return who has a federal adjusted gross income less than or equal to ten24
thousand dollars;25
(B) Two qualified individuals filing a joint return with a federal26
adjusted gross income less than or equal to sixteen thousand dollars; or27
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(C) A qualified individual and a nonqualified individual filing a1
joint return with a federal adjusted gross income less than or equal to2
sixteen thousand dollars;3
(II) One thousand dollars for:4
(A) A qualified individual OR A SURVIVING SPOUSE filing a single5
return who has a federal adjusted gross income greater than ten thousand6
dollars but less than or equal to twelve thousand five hundred dollars;7
(B) Two qualified individuals filing a joint return with a federal8
adjusted gross income greater than sixteen thousand dollars but less than9
or equal to twenty thousand dollars; or10
(C) A qualified individual and a nonqualified individual filing a11
joint return with a federal adjusted gross income greater than sixteen12
thousand dollars but less than or equal to twenty thousand dollars;13
(III) Eight hundred dollars for:14
(A) A qualified individual OR A SURVIVING SPOUSE filing a single15
return who has a federal adjusted gross income greater than twelve16
thousand five hundred dollars but less than or equal to fifteen thousand17
dollars;18
(B) Two qualified individuals filing a joint return with a federal19
adjusted gross income greater than twenty thousand dollars but less than20
or equal to twenty-four thousand dollars; or21
(C) A qualified individual and a nonqualified individual filing a22
joint return with a federal adjusted gross income greater than twenty23
thousand dollars but less than or equal to twenty-four thousand dollars;24
(IV) Six hundred dollars for:25
(A) A qualified individual OR A SURVIVING SPOUSE filing a single26
return who has a federal adjusted gross income greater than fifteen27
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thousand dollars but less than or equal to seventeen thousand five1
hundred dollars;2
(B) Two qualified individuals filing a joint return with a federal3
adjusted gross income greater than twenty-four thousand dollars but less4
than or equal to twenty-eight thousand dollars; or5
(C) A qualified individual and a nonqualified individual filing a6
joint return with a federal adjusted gross income greater than twenty-four7
thousand dollars but less than or equal to twenty-eight thousand dollars;8
and9
(V) Four hundred dollars for:10
(A) A qualified individual OR A SURVIVING SPOUSE filing a single11
return who has a federal adjusted gross income greater than seventeen12
thousand five hundred dollars but less than or equal to twenty thousand13
dollars;14
(B) Two qualified individuals filing a joint return with a federal15
adjusted gross income greater than twenty-eight thousand dollars but less16
than or equal to thirty-two thousand dollars; or17
(C) A qualified individual and a nonqualified individual filing a18
joint return with a federal adjusted gross income greater than twenty-eight19
thousand dollars but less than or equal to thirty-two thousand dollars.20
(b) (I) A qualified individual OR A SURVIVING SPOUSE who files a21
single return and has a federal adjusted gross income greater than twenty22
thousand dollars is not allowed a credit under this section.23
(II) Two qualified individuals, or a qualified individual and a24
nonqualified individual, who file a joint return with a federal adjusted25
gross income greater than thirty-two thousand dollars are not allowed a26
credit under this section.27
HB26-1289-17-
(c) (I) The department of revenue shall annually adjust for1
inflation the credit amounts set forth in subsection (4)(a) of this section2
if cumulative inflation since the last adjustment, when applied to the3
current credit amounts, results in an increase of at least ten dollars when4
the adjusted credit amounts are rounded to the nearest ten dollars.5
(II) The department of revenue shall annually adjust for inflation6
the adjusted gross income amounts set forth in subsections (4)(a) and7
(4)(b) of this section if cumulative inflation since the last adjustment,8
when applied to the current adjusted gross income amounts, results in an9
increase of at least one hundred dollars when the adjusted gross income10
amounts, as adjusted, are rounded to the nearest one hundred dollars.11
(5) (a) If the credit exceeds the income taxes due on the qualified12
individual's OR SURVIVING SPOUSE'S income, the amount of the credit not13
used to offset income taxes is not carried forward and must be refunded14
to the qualified individual OR SURVIVING SPOUSE.15
(b) A QUALIFIED INDIVIDUAL OR SURVIVING SPOUSE IS ALLOWED16
ONE CREDIT PURSUANT TO THIS SECTION PER INCOME TAX YEAR.17
(6) A qualified individual who claims the credit cannot in the18
same tax year also claim the grant allowed pursuant to section 39-31-101.19
(7) (6) The credit received pursuant to this section is not treated20
as income for purposes of determining the eligibility of any individual for21
old age pension benefits under article 2 of title 26.22
(8) (7) Notwithstanding section 39-21-304 (4), the credit23
continues indefinitely.24
(9) The credit allowed by this section is administered in the same25
manner as other credits against the tax imposed by article 22 of this title26
39.27
HB26-1289-18-
(8) IN THE CASE OF A PART-YEAR RESIDENT, THE CREDIT ALLOWED1
UNDER THIS SECTION IS APPORTIONED IN THE RATIO DETERMINED UNDER2
SECTION 39-22-110 (1).3
SECTION 5. In Colorado Revised Statutes, 39-22-303, amend4
(8)(a), (8)(b)(I), (11.5)(b)(I), and (11.5)(b)(II); and add (8)(c), (8.5),5
(12)(c.3), and (12)(c.5) as follows:6
39-22-303. Dividends in a combined report - foreign source7
income - affiliated groups - definitions - rules - repeal.8
(8) (a) Except as provided in subsection (8)(b) of this section, FOR9
TAX YEARS BEGINNING BEFORE JANUARY 1, 2027, neither the taxpayer nor10
the executive director shall include in a combined report any C11
corporation that conducts business outside the United States if eighty12
percent or more of the C corporation's property and payroll, as determined13
by factoring pursuant to section 24-60-1301, is assigned to locations14
outside the United States. For the purpose of this subsection (8), "United15
States" is restricted to the fifty states and the District of Columbia.16
(b) (I) For tax years beginning on or after January 1, 2022, BUT17
BEFORE JANUARY 1, 2027, a taxpayer shall include in the combined group18
any member of an affiliated group of C corporations that is incorporated19
in a foreign jurisdiction for the purpose of tax avoidance.20
(c) THIS SUBSECTION (8) IS REPEALED, EFFECTIVE DECEMBER 31,21
2031.22
(8.5) (a) F OR INCOME TAX YEARS BEGINNING ON OR AFTER23
JANUARY 1, 2027, THE MEMBERS OF AN AFFILIATED GROUP OF C24
CORPORATIONS REQUIRED TO FILE A COMBINED REPORT PURSUANT TO25
SUBSECTION (11.5)(b)(I) OF THIS SECTION MAY MAKE A WATER 'S-EDGE26
ELECTION AS SET FORTH IN SUBSECTION (8.5)(c) OF THIS SECTION.27
HB26-1289-19-
(b) (I) T HE COMBINED GROUP SHALL INCLUDE THE ENTIRE NET1
INCOME AND APPORTIONMENT FACTORS OF:2
(A) E VERY MEMBER OF THE AFFILIATED GROUP THAT IS3
INCORPORATED IN THE UNITED STATES OR FORMED UNDER THE LAWS OF4
ANY STATE , THE DISTRICT OF COLUMBIA, OR ANY TERRITORY OR5
POSSESSION OF THE UNITED STATES;6
(B) EVERY MEMBER OF THE AFFILIATED GROUP, REGARDLESS OF7
THE PLACE WHERE THE MEMBER WAS INCORPORATED OR FORMED , IF8
TWENTY PERCENT OR MORE OF THE MEMBER 'S PROPERTY AND PAYROLL,9
AS DETERMINED BY FACTORING PURSUANT TO SECTION 24-60-1301, IS10
ASSIGNED TO LOCATIONS WITHIN THE UNITED STATES. FOR THE PURPOSE11
OF THIS SUBSECTION (8.5)(b)(I)(B), "UNITED STATES" IS RESTRICTED TO12
THE FIFTY STATES AND THE DISTRICT OF COLUMBIA.13
(C) E VERY MEMBER OF THE AFFILIATED GROUP THAT IS A14
DOMESTIC INTERNATIONAL SALES CORPORATION AS DESCRIBED IN15
SECTIONS 991 TO 994 OF THE INTERNAL REVENUE CODE OR AN EXPORT16
TRADE CORPORATION AS DESCRIBED IN SECTIONS 970 AND 971 OF THE17
INTERNAL REVENUE CODE; AND18
(D) E VERY MEMBER OF THE AFFILIATED GROUP THAT IS19
INCORPORATED IN A FOREIGN JURISDICTION FOR THE PURPOSE OF TAX20
AVOIDANCE.21
(II) TO THE EXTENT SUCH AMOUNTS ARE NOT ALREADY INCLUDED22
PURSUANT TO SUBSECTION (8.5)(b)(I) OF THIS SECTION , THE COMBINED23
GROUP SHALL ALSO INCLUDE:24
(A) T HE PORTION OF THE NET INCOME OF A MEMBER OF THE25
AFFILIATED GROUP DERIVED FROM OR ATTRIBUTABLE TO SOURCES WITHIN26
THE UNITED STATES, AS DETERMINED PURSUANT TO THE INTERNAL27
HB26-1289-20-
REVENUE CODE WITHOUT REGARD TO FEDERAL TREATIES , AND THE1
RELATED APPORTIONMENT FACTORS; AND2
(B) IN THE CASE OF A MEMBER OF THE AFFILIATED GROUP THAT3
EARNS MORE THAN TWENTY PERCENT OF ITS NET INCOME , DIRECTLY OR4
INDIRECTLY, FROM INTANGIBLE PROPERTY OR SERVICE -RELATED5
ACTIVITIES THAT ARE DEDUCTIBLE FROM THE APPORTIONABLE INCOME OF6
ONE OR MORE MEMBERS OF THE COMBINED GROUP , THE RELATED NET7
INCOME AND THE APPORTIONMENT FACTORS.8
(III) FOR PURPOSES OF THIS SUBSECTION (8.5)(b), A MEMBER OF9
THE AFFILIATED GROUP IS PRESUMPTIVELY INCORPORATED IN A FOREIGN10
JURISDICTION FOR THE PURPOSE OF TAX AVOIDANCE IF THE MEMBER IS11
INCORPORATED IN A LISTED JURISDICTION . A MEMBER IS NOT12
INCORPORATED IN A FOREIGN JURISDICTION FOR THE PURPOSE OF TAX13
AVOIDANCE IF THE COMBINED GROUP PROVES TO THE SATISFACTION OF14
THE EXECUTIVE DIRECTOR, OR IF THE EXECUTIVE DIRECTOR DETERMINES,15
THAT THE MEMBER IS INCORPORATED IN A LISTED JURISDICTION FOR16
REASONS THAT MEET THE ECONOMIC SUBSTANCE DOCTRINE DESCRIBED IN17
SECTION 7701 (o) OF THE INTERNAL REVENUE CODE.18
(c) (I) T HE COMBINED GROUP MUST MAKE A WATER 'S-EDGE19
ELECTION ON A TIMELY FILED , ORIGINAL RETURN FOR AN INCOME TAX20
YEAR.21
(II) (A) E XCEPT AS PROVIDED IN SUBSECTION (8.5)(c)(II)(C) OF22
THIS SECTION, A COMBINED GROUP'S WATER'S-EDGE ELECTION IS BINDING23
FOR AND APPLICABLE TO THE INCOME TAX YEAR WHEN THE COMBINED24
GROUP MAKES THE ELECTION AND EACH OF THE NINE INCOME TAX YEARS25
THEREAFTER.26
(B) U PON THE EXPIRATION OF THE PERIOD DESCRIBED IN27
HB26-1289-21-
SUBSECTION (8.5)(c)(II)(A) OF THIS SECTION , A COMBINED GROUP MAY1
WITHDRAW THE WATER'S-EDGE ELECTION. THE COMBINED GROUP MUST2
WITHDRAW THE ELECTION ON A TIMELY FILED, ORIGINAL TAX RETURN FOR3
THE FIRST INCOME TAX YEAR AFTER THE PERIOD DESCRIBED IN4
SUBSECTION (8.5)(c)(II)(A) OF THIS SECTION , OR BY OTHER WRITTEN5
WITHDRAWAL MADE IN THE TIME AND MANNER PRESCRIBED BY RULES6
PROMULGATED BY THE EXECUTIVE DIRECTOR . EXCEPT AS PROVIDED IN7
SUBSECTION (8.5)(c)(II)(C) OF THIS SECTION , A COMBINED GROUP 'S8
WITHDRAWAL OF AN ELECTION IS BINDING FOR AND APPLICABLE TO THE9
INCOME TAX YEAR WHEN THE COMBINED GROUP WITHDRAWS THE10
ELECTION AND EACH OF THE NINE INCOME TAX YEARS THEREAFTER. IF THE11
COMBINED GROUP DOES NOT WITHDRAW THE ELECTION AS DESCRIBED IN12
THIS SUBSECTION (8.5)(c)(II)(B), THE ELECTION IS DEEMED RENEWED FOR13
AN ADDITIONAL TEN-YEAR PERIOD, SUBJECT TO THE SAME CONDITIONS AS14
APPLIED TO THE ORIGINAL ELECTION.15
(C) A COMBINED GROUP MAY PETITION THE EXECUTIVE DIRECTOR16
TO WITHDRAW A WATER'S-EDGE ELECTION PRIOR TO THE EXPIRATION OF17
THE PERIOD SET FORTH IN SUBSECTION (8.5)(c)(II)(A) OF THIS SECTION, OR18
TO REINSTATE A WITHDRAWN ELECTION , UPON A SHOWING OF19
REASONABLE CAUSE BASED UPON EXTRAORDINARY HARDSHIP DUE TO20
UNFORESEEN CHANGES IN STATE TAX STATUTES, LAW, OR POLICY. IF THE21
EXECUTIVE DIRECTOR GRANTS A WITHDRAWAL OF AN ELECTION , THE22
EXECUTIVE DIRECTOR MAY IMPOSE REASONABLE CONDITIONS AS23
NECESSARY TO PREVENT THE EVASION OF TAX OR TO CLEARLY REFLECT24
NET INCOME FOR THE ELECTION PERIOD PRIOR TO OR AFTER THE25
WITHDRAWAL.26
(III) T HE EXECUTIVE DIRECTOR MAY PROMULGATE RULES27
HB26-1289-22-
GOVERNING THE EFFECT , IF ANY , ON THE SCOPE OR APPLICATION OF A1
WATER'S-EDGE ELECTION, INCLUDING THE PROCEDURES FOR ELECTION AND2
TERMINATION OR DEEMED ELECTION, RESULTING FROM A CHANGE IN THE3
COMPOSITION OF THE UNITARY GROUP , THE COMBINED GROUP , THE4
MEMBERS, AND ANY OTHER SIMILAR CHANGE.5
(d) THE EXECUTIVE DIRECTOR MAY DISREGARD A WATER'S-EDGE6
ELECTION IN PART OR IN WHOLE , AND THE NET INCOME AND7
APPORTIONMENT FACTORS OF ANY MEMBER OF THE UNITARY GROUP MAY8
BE INCLUDED IN THE COMBINED REPORT, NOTWITHSTANDING SUBSECTIONS9
(8.5)(a) TO (8.5)(c) OF THIS SECTION, IF:10
(I) ANY MEMBER OF THE UNITARY GROUP FAILS TO COMPLY WITH11
ANY PROVISION OF THIS ARTICLE 22 OR ANY PROVISION OF ARTICLE 21 OF12
THIS TITLE 39; OR13
(II) A PERSON OTHERWISE NOT INCLUDED IN THE WATER 'S-EDGE14
COMBINED GROUP IS USED FOR A SUBSTANTIAL STATE INCOME TAX15
AVOIDANCE PURPOSE.16
(e) A COMBINED GROUP'S WATER'S-EDGE ELECTION PURSUANT TO17
THIS SUBSECTION (8.5) HAS NO EFFECT ON WHETHER A PERSON EXCLUDED18
FROM THE WATER'S-EDGE COMBINED GROUP MAY BE SEPARATELY LIABLE19
FOR THE TAX IMPOSED BY THIS ARTICLE 22. A PERSON EXCLUDED FROM A20
WATER'S-EDGE COMBINED GROUP AND SUBJECT TO THE TAX IMPOSED BY21
THIS ARTICLE 22 SHALL SEPARATELY FILE AND PAY SUCH TAX AS22
PROVIDED IN THIS ARTICLE 22.23
(11.5) (b) For tax years beginning on and after January 1, 2026:24
(I) Except as provided in subsection SUBSECTION (8) OR (8.5) of25
this section, all of the members of an affiliated group of C corporations,26
wherever incorporated or domiciled, that are members of a unitary27
HB26-1289-23-
business shall file a combined report as a combined group.1
(II) (A) The net income of each member of the combined group,2
as determined under section 39-22-304, is combined, eliminating items3
of income, expense, gain, and loss from transactions between members4
of the combined group, applying the consolidated filing rules under the5
internal revenue code, and the regulations thereunder, as if the combined6
group was a consolidated filing group. Dividends are eliminated to the7
extent permitted under subsection (9) of this section.8
(B) A COMBINED GROUP SHALL ELIMINATE DIVIDENDS FROM A9
COMBINED REPORT TO THE EXTENT PERMITTED UNDER SUBSECTION (9) OF10
THIS SECTION.11
(C) T O THE EXTENT THE NET INCOME OF A MEMBER OF A12
COMBINED GROUP INCLUDES SUBPART F I N C O M E O R N E T CFC TESTED13
INCOME WITH RESPECT TO ANOTHER MEMBER OF THE COMBINED GROUP OF14
WHICH THE MEMBER IS A UNITED STATES SHAREHOLDER, THE COMBINED15
GROUP SHALL ELIMINATE SUCH SUBPART F OR NET CFC TESTED INCOME16
FROM A COMBINED REPORT.17
(12) As used in this section, unless the context otherwise requires:18
(c.3) "NET CFC TESTED INCOME " MEANS INCOME INCLUDED AS19
FEDERAL GROSS INCOME PURSUANT TO SECTION 951A (a) OF THE20
INTERNAL REVENUE CODE.21
(c.5) "SUBPART F INCOME" MEANS INCOME INCLUDED AS FEDERAL22
GROSS INCOME PURSUANT TO SECTION 951 (a) OF THE INTERNAL REVENUE23
CODE.24
SECTION 6. In Colorado Revised Statutes, 39-22-304, amend25
(3)(i) and (3)(q) as follows:26
39-22-304. Net income of corporation - legislative declaration27
HB26-1289-24-
- definitions - repeal.1
(3) There shall be subtracted from federal taxable income:2
(i) (I) F OR INCOME TAX YEARS BEGINNING BEFORE JANUARY 1,3
2027, that portion of wages or salaries paid or incurred for the taxable4
year, the deduction for which is disallowed by section 280C of the5
internal revenue code.6
(II) THIS SUBSECTION (3)(i) IS REPEALED, EFFECTIVE DECEMBER7
31, 2031.8
(q) (I) FOR INCOME TAX YEARS BEGINNING ON OR AFTER JANUARY9
1, 2022, BUT BEFORE JANUARY 1, 2027:10
(I) (A) Any amount included in federal taxable income pursuant11
to section 951 (a) of the internal revenue code with respect to a controlled12
foreign corporation that is a C corporation incorporated in a foreign13
jurisdiction for the purpose of tax avoidance pursuant to section14
39-22-303 (8)(b)(II); and15
(II) (B) The amount of any income included in federal taxable16
income pursuant to section 951A (a) of the internal revenue code with17
respect to a controlled foreign corporation that is a C corporation18
incorporated in a foreign jurisdiction for the purpose of tax avoidance19
pursuant to section 39-22-303 (8)(b)(II), less any amount deducted under20
section 250 (a)(1)(B) of the internal revenue code with respect to such21
income.22
(II) THIS SUBSECTION (3)(q) IS REPEALED, EFFECTIVE DECEMBER23
31, 2031.24
SECTION 7. In Colorado Revised Statutes, 39-22-516.7, amend25
(4)(a)(IX), (4)(a)(X), (4)(a.3), (4)(a.5), and (4)(a.7) as follows:26
39-22-516.7. Tax credit for innovative motor vehicles - tax27
HB26-1289-25-
preference performance statement - legislative declaration -1
definitions - repeal.2
(4) The amount of the credit allowed pursuant to this section is3
calculated as follows:4
(a) Category 1.5
(IX) Except as otherwise provided in subsection (4)(a.7) of this6
section, with respect to the purchase or lease of a category 1 vehicle sold7
or leased in tax years commencing on or after January 1, 2027, but before8
January 1, 2028, one TWO thousand dollars;9
(X) Except as otherwise provided in subsection (4)(a.7) of this10
section, with respect to the purchase or lease of a category 1 vehicle sold11
or leased in tax years commencing on or after January 1, 2028, but before12
January 1, 2029, five hundred ONE THOUSAND dollars; and13
(a.3) Limitation on credit. 14
(I) No credit is allowed for a purchase or lease made on or after15
July 1, 2023, but before January 1, 2029 JANUARY 1, 2027, of a Category16
1 vehicle that exceeds a manufacturer's suggested retail price of17
eighty-thousand dollars.18
(II) NO CREDIT IS ALLOWED FOR A PURCHASE OR LEASE MADE ON19
OR AFTER JANUARY 1, 2027, BUT BEFORE JANUARY 1, 2029, OF A20
CATEGORY 1 VEHICLE THAT EXCEEDS A MANUFACTURER 'S SUGGESTED21
RETAIL PRICE OF FIFTY THOUSAND DOLLARS.22
(a.5) (I) Category 1 for vehicles under $35,000 threshold. With23
respect to the purchase or lease of a category 1 vehicle sold or leased in24
tax years commencing on or after January 1, 2024, but prior to January 1,25
2029 J ANUARY 1, 2027, with a manufacturer's suggested retail price26
below thirty-five thousand dollars there is allowed an additional two27
HB26-1289-26-
thousand five hundred dollars of credit in addition to the amount of credit1
allowed pursuant to subsection (4)(a) of this section.2
(II) CATEGORY 1 FOR VEHICLES UNDER $40,000 THRESHOLD.3
WITH RESPECT TO THE PURCHASE OR LEASE OF A CATEGORY 1 VEHICLE4
SOLD OR LEASED IN TAX YEARS COMMENCING ON OR AFTER JANUARY 1,5
2027, BUT PRIOR TO JANUARY 1, 2029, WITH A MANUFACTURER 'S6
SUGGESTED RETAIL PRICE BELOW FORTY THOUSAND DOLLARS THERE IS7
ALLOWED AN ADDITIONAL TWO THOUSAND FIVE HUNDRED DOLLARS OF8
CREDIT IN ADDITION TO THE AMOUNT OF CREDIT ALLOWED PURSUANT TO9
SUBSECTION (4)(a) OF THIS SECTION.10
(a.7) (I) If the June 2025 revenue forecast, and each June revenue11
forecast through the June 2027 revenue forecast as prepared by either12
legislative council staff or the office of state planning and budgeting,13
projects that state revenues, as defined in section 24-77-103.6 (6)(c), will14
not increase by at least four percent for the next fiscal year, the amount15
of the credit allowed pursuant to subsection (4)(a)(VIII), (4)(a)(IX), or16
(4)(a)(X) of this section for any THE INCOME tax year commencing in the17
calendar year that begins during said next fiscal year is reduced by fifty18
percent; except that if the amount of reduced credit is equal to or less than19
five hundred dollars, then no credit is available for such a THAT INCOME20
tax year.21
(II) THIS SUBSECTION (4)(a.7) IS REPEALED, EFFECTIVE DECEMBER22
31, 2031.23
SECTION 8. In Colorado Revised Statutes, 39-22-543, amend24
(2)(d), (3)(a), (4)(b), (5), and (6); and add (4)(c) as follows:25
39-22-543. Credit for wildfire hazard mitigation expenses -26
legislative declaration - definitions - repeal.27
HB26-1289-27-
(2) As used in this section, unless the context otherwise requires:1
(d) "Wildfire mitigation measures" means the creation of a2
defensible space around structures; the establishment of fuel breaks; the3
thinning of woody vegetation for the primary purpose of reducing risk to4
structures from wildland fire; or the secondary treatment of woody fuels5
by lopping and scatteri ng, piling, chippi ng, removing from the site, or6
prescribed burning; so long as such activities meet or exceed any7
Colorado state forest service standards or any other applicable state rules.8
FOR INCOME TAX YEARS BEGINNING ON AND AFTER JANUARY 1, 2027,9
"WILDFIRE MITIGATION MEASURES" INCLUDES THE THINNING OF WOODY10
VEGETATION THAT IS AT RISK OF MOUNTAIN PINE BEETLE OR SPRUCE11
BEETLE INFESTATION OR THAT HAS BEEN KILLED BY MOUNTAIN PINE12
BEETLES OR SPRUCE BEETLES , SO LONG AS SUCH ACTIVITIES MEET OR13
EXCEED ANY COLORADO STATE FOREST SERVICE STANDARDS OR ANY14
OTHER APPLICABLE STATE RULES.15
(3) (a) FOR INCOME TAX YEARS BEGINNING BEFORE JANUARY 1,16
2027, in the case of two taxpayers filing a joint return, the amount of the17
credit shall not exceed six hundred twenty-five dollars in any taxable18
year. FOR INCOME TAX YEARS BEGINNING ON AND AFTER JANUARY 1,19
2027, IN THE CASE OF TWO TAXPAYERS FILING A JOINT RETURN , THE20
AMOUNT OF THE CREDIT SHALL NOT EXCEED TWO THOUSAND DOLLARS IN21
ANY TAXABLE YEAR. In the case of two taxpayers who may legally file a22
joint return but actually file separate returns, only one of the taxpayers23
may claim the credit specified in this section.24
(4) (b) For income tax years commencing on or after January 1,25
2025, but prior to January 1, 2028 JANUARY 1, 2027, a landowner with a26
federal taxable income at or below one hundred twenty thousand dollars27
HB26-1289-28-
for the income tax year commencing on or after January 1, 2023, as1
adjusted for inflation and rounded to the nearest hundred dollars for each2
income tax year thereafter, is allowed a credit against the income taxes3
imposed by this article 22 in an amount equal to the landowner's costs4
incurred for wildfire mitigation measures in an amount up to one5
thousand dollars. The maximum total credit in a taxable year FOR A6
LANDOWNER is one thousand dollars.7
(c) FOR INCOME TAX YEARS BEGINNING ON OR AFTER JANUARY 1,8
2027, BUT BEFORE JANUARY 1, 2031, A LANDOWNER WITH AN ADJUSTED9
GROSS INCOME AT OR BELOW THREE HUNDRED THOUSAND DOLLARS FOR10
THE INCOME TAX YEAR BEGINNING ON OR AFTER JANUARY 1, 2027, AS11
ADJUSTED FOR INFLATION AND ROUNDED TO THE NEAREST HUNDRED12
DOLLARS FOR EACH INCOME TAX YEAR THEREAFTER, IS ALLOWED A CREDIT13
AGAINST THE INCOME TAXES IMPOSED BY THIS ARTICLE 22 IN AN AMOUNT14
EQUAL TO THE LANDOWNER'S COSTS INCURRED FOR WILDFIRE MITIGATION15
MEASURES IN AN AMOUNT UP TO TWO THOUSAND DOLLARS. THE MAXIMUM16
TOTAL CREDIT IN A TAXABLE YEAR FOR A LANDOWNER IS TWO THOUSAND17
DOLLARS.18
(5) (a) If the amount of a credit under this section exceeds a19
taxpayer's actual tax liability for an income tax year BEGINNING BEFORE20
JANUARY 1, 2026, the amount of the credit not used to offset the21
taxpayer's income tax liability is not refunded to the taxpayer and shall22
not be carried forward as a tax credit against the taxpayer's income tax23
liability in any subsequent tax year.24
(b) FOR INCOME TAX YEARS BEGINNING ON OR AFTER JANUARY 1,25
2026, IF THE AMOUNT OF THE CREDIT ALLOWED UNDER THIS SECTION26
EXCEEDS THE AMOUNT OF INCOME TAXES OTHERWISE DUE ON THE27
HB26-1289-29-
QUALIFIED TAXPAYER'S INCOME IN THE INCOME TAX YEAR FOR WHICH THE1
CREDIT IS CLAIMED, THE AMOUNT OF THE CREDIT NOT USED AS AN OFFSET2
AGAINST INCOME TAXES IN THE CURRENT INCOME TAX YEAR MAY BE3
CARRIED FORWARD AND USED AS A CREDIT AGAINST INCOME TAX4
LIABILITY IN SUBSEQUENT YEARS FOR A PERIOD NOT TO EXCEED FIVE5
YEARS AND MUST BE APPLIED FIRST TO THE EARLIEST POSSIBLE INCOME6
TAX YEAR. ANY CREDIT REMAINING AFTER THE PERIOD IS NOT REFUNDED7
OR CREDITED TO THE QUALIFIED TAXPAYER.8
(6) This section is repealed, effective January 1, 2030 JANUARY9
1, 2040.10
SECTION 9. In Colorado Revised Statutes, 39-22-549, amend11
(2)(e), (2)(h), (3)(a)(I)(B), (3)(a)(II)(B), (4)(a) introductory portion,12
(5)(a)(I)(A), (5)(b), and (5)(c); and add (2)(e.5), (2)(e.7), and (3)(a)(III)13
as follows:14
39-22-549. Credit against tax - small food business recovery15
and resilience grant program equipment - community food16
consortium duties and responsibilities - tax preference performance17
statement - legislative declaration - definitions - repeal.18
(2) As used in this section, unless the context otherwise requires:19
(e) "Purchaser" means:20
(I) F OR INCOME TAX YEARS COMMENCING BEFORE JANUARY 1,21
2027, a small food retailer or small family farm that purchases small food22
business recovery and resilience grant program equipment.23
(II) FOR INCOME TAX YEARS COMMENCING ON OR AFTER JANUARY24
1, 2027, A QUALIFIED DISTRIBUTOR, QUALIFIED PRODUCER, SMALL FOOD25
RETAILER, OR SMALL FAMILY FARM THAT PURCHASES SMALL FOOD26
BUSINESS RECOVERY AND RESILIENCE GRANT PROGRAM EQUIPMENT.27
HB26-1289-30-
(e.5) "QUALIFIED DISTRIBUTOR" MEANS A COLORADO-OWNED AND1
OPERATED BUSINESS OR ORGANIZATION THAT:2
(I) ACTIVELY MANAGES THE AGGREGATION, DISTRIBUTION, AND3
MARKETING OF SOURCE-IDENTIFIED RAW AGRICULTURAL PRODUCTS;4
(II) P RIORITIZES THE AGGREGATION , DISTRIBUTION , AND5
MARKETING OF SOURCE -IDENTIFIED RAW AGRICULTURAL PRODUCTS TO6
COLORADO PRODUCERS TO SATISFY WHOLESALE , RETAIL , AND7
INSTITUTIONAL DEMAND; AND8
(III) H AS MANAGED THE AGGREGATION , DISTRIBUTION , AND9
MARKETING OF SOURCE-IDENTIFIED RAW AGRICULTURAL PRODUCTS TO A10
MEMBER OF THE CONSORTIUM IN THE INCOME TAX YEAR FOR WHICH THE11
BUSINESS OR ORGANIZATION IS CLAIMING A TAX CREDIT PURSUANT TO THIS12
SECTION.13
(e.7) "QUALIFIED PRODUCER" MEANS A COLORADO-OWNED AND14
OPERATED FARM OR RANCH THAT FILES A SCHEDULE F WITH THE INTERNAL15
REVENUE SERVICE AND THAT IS SELLING ITS PRODUCT TO A CHARITABLE16
FOOD SYSTEM OR SCHOOL.17
(h) "Small food retailers" has the same meaning as set forth in18
section 35-1-117 (8)(e) FOR INCOME TAX YEARS COMMENCING BEFORE19
JANUARY 1, 2027. FOR INCOME TAX YEARS COMMENCING ON OR AFTER20
JANUARY 1, 2027, "SMALL FOOD RETAILERS" MEANS:21
(I) A N INDEPENDENT OR NONPROFIT -MANAGED ,22
COLORADO-OWNED, AND COLORADO-OPERATED SMALL FOOD RETAIL23
BUSINESS, DEFINED AS A FOOD RETAILER THAT:24
(A) HAS FIVE OR FEWER SEPARATE LOCATIONS WITH LESS THAN25
TWENTY-TWO THOUSAND SQUARE FEET OF RETAIL SPACE PER LOCATION;26
(B) CARRIES AT LEAST THREE CATEGORIES OF FEDERALLY DEFINED27
HB26-1289-31-
STAPLE FOODS, AS DESCRIBED IN THE FEDERAL "FOOD AND NUTRITION1
ACT OF 2008", SECS . 3 AND 9; THE FEDERAL "CONSOLIDATED2
APPROPRIATIONS ACT OF 2017", SEC. 76; AND THE FEDERAL "ENHANCING3
RETAILER STANDARDS IN THE SUPPLEMENTAL NUTRITION ASSISTANCE4
PROGRAM", 81 FED. REG. 90675; AND5
(C) I S LOCATED IN OR PROVIDES FOOD TO LOCAL , STATE , OR6
FEDERALLY DEFINED LOW-INCOME, LOW-ACCESS NEIGHBORHOODS; OR7
(II) IS A FARMER'S MARKET OR FARM-DIRECT OPERATION THAT IS8
ALREADY OR DEMONSTRATES AN INTENT TO BECOME SNAP AND WIC9
AUTHORIZED WHERE ALLOWED.10
(3) (a) Subject to the provisions of subsection (4) of this section:11
(I) (B) For income tax years commencing on or after January 1,12
2025, but before January 1, 2031, any member of the food consortium is13
allowed a credit against the tax imposed by this article 22 in an amount14
equal to seventy-five percent of the amount certain spent by the member15
of the consortium on completing its duties and responsibilities minus any16
amount awarded to the member of the consortium pursuant to section17
35-1-117 (2) for the completion of its duties and responsibilities; and18
(II) (B) For income tax years commencing on or after January 1,19
2025, but before January 1, 2031, any purchaser of small food business20
recovery and resilience grant program equipment is allowed a credit21
against the tax imposed by this article 22 in an amount equal to22
seventy-five percent of the purchase price of the relevant small food23
business recovery and resilience grant program equipment minus the24
amount of any grant awarded under the small food business recovery and25
resilience grant program for the purchase of the same small food business26
recovery and resilience grant program equipment; AND27
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(III) NOTWITHSTANDING SUBSECTION (3)(a)(I) AND (3)(a)(II) OF1
THIS SECTION , FOR INCOME TAX YEARS COMMENCING ON OR AFTER2
JANUARY 1, 2027, A TAXPAYER IS ONLY ALLOWED A CREDIT AGAINST THE3
TAX IMPOSED BY THIS ARTICLE 22 PURSUANT TO THIS SECTION IF THE4
CREDIT WOULD BE IN AN AMOUNT EQUAL TO OR GREATER THAN FIVE5
HUNDRED DOLLARS.6
(4) (a) FOR INCOME TAX YEARS COMMENCING PRIOR TO JANUARY7
1, 2027, a member of the consortium or a purchaser of small food8
business recovery grant program equipment may submit an application to9
the department of agriculture for the issuance of a letter of eligibility for10
a tax credit certificate allowed in this section by the deadlines established11
in the rules promulgated by the department of agriculture. The application12
must include:13
(5) (a) A member of the consortium or a purchaser of small food14
business recovery grant program equipment shall submit an application15
to the department of agriculture for the issuance of a tax credit certificate16
allowed in this section by the deadlines established in the rules17
promulgated by the department of agriculture. The application must18
include:19
(I) A certification that the applicant is either:20
(A) A purchaser who is a QUALIFIED DISTRIBUTOR, QUALIFIED21
PRODUCER, small food retailer, or small family farm that purchased small22
food business recovery and resilience grant program equipment; or23
(b) If the department of agriculture determines that the application24
filed pursuant to subsection (5)(a) of this section is complete, the25
department of agriculture shall determine whether the applicant qualifies26
for the credit allowed pursuant to this section. If the department of27
HB26-1289-33-
agriculture approves the application, the department of agriculture shall1
issue a tax credit certificate to the applicant that indicates the amount of2
the tax credit that the purchaser or member of the consortium may claim3
for the specified income tax year; except that:4
(I) The total amount of tax credit certificates issued by the5
department of agriculture in a given income tax year must not exceed a6
total of ten million dollars FOR INCOME TAX YEARS COMMENCING BEFORE7
JANUARY 1, 2027, A TOTAL OF FIVE MILLION DOLLARS FOR THE INCOME8
TAX YEAR COMMENCING ON JANUARY 1, 2027, AND , FOR INCOME TAX9
YEARS COMMENCING ON OR AFTER JANUARY 1, 2028, A TOTAL OF FIVE10
MILLION DOLLARS, UNLESS THE DEPARTMENT OF AGRICULTURE WOULD11
HAVE ISSUED A TOTAL AMOUNT OF CREDIT CERTIFICATES IN EXCESS OF12
FIVE MILLION DOLLARS FOR AN INCOME TAX YEAR COMMENCING ON OR13
AFTER JANUARY 1, 2027, BUT FOR THE LIMITATION ON TAX CREDIT14
CERTIFICATES IN THIS SUBSECTION (5)(b)(I), IN WHICH CASE THE TOTAL15
AMOUNT OF TAX CREDIT CERTIFICATES ISSUED BY THE DEPARTMENT OF16
AGRICULTURE MUST NOT EXCEED TEN , RATHER THAN FIVE , MILLION17
DOLLARS FOR FUTURE INCOME TAX YEARS; AND18
(II) F OR AN INCOME TAX YEAR COMMENCING ON OR AFTER19
JANUARY 1, 2027, THE MAXIMUM ALLOWABLE CREDIT AMOUNT FOR A20
SMALL FAMILY FARM THAT CLAIMS A CREDIT PURSUANT TO THIS SECTION21
IS THREE HUNDRED THOUSAND DOLLARS AND IS ONE MILLION DOLLARS22
FOR ANY OTHER TAXPAYER THAT CLAIMS A CREDIT PURSUANT TO THIS23
SECTION.24
(c) (I) FOR INCOME TAX YEARS COMMENCING BEFORE JANUARY 1,25
2027, the department of agriculture shall issue tax credit certificates26
allowed in this section in an order that accords with the rules promulgated27
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by the department of agriculture. The department of agriculture shall1
review and approve or disapprove an application filed pursuant to2
subsection (5)(a) of this section within a reasonable time, not to exceed3
ninety days after the filing of a completed application.4
(II) FOR INCOME TAX YEARS COMMENCING ON OR AFTER JANUARY5
1, 2027, THE DEPARTMENT OF AGRICULTURE SHALL REVIEW AND APPROVE6
OR DISAPPROVE AN APPLICATION FILED PURSUANT TO SUBSECTION (5)(a)7
OF THIS SECTION WITHIN A REASONABLE TIME , NOT TO EXCEED ONE8
HUNDRED FIFTY DAYS AFTER THE FILING OF A COMPLETED APPLICATION.9
THE DEPARTMENT OF AGRICULTURE SHALL ISSUE TAX CREDIT10
CERTIFICATES ALLOWED IN THIS SECTION IN THE FOLLOWING ORDER OR11
PRIORITY:12
(A) FIRST, TO CONSORTIUM MEMBERS;13
(B) SECOND, TO SMALL FOOD RETAILERS;14
(C) THIRD, TO SMALL FAMILY FARMS;15
(D) FOURTH, TO QUALIFIED DISTRIBUTORS; AND16
(E) FIFTH, TO QUALIFIED PRODUCERS.17
SECTION 10. In Colorado Revised Statutes, 39-22-550, amend18
(1)(b) introductory portion, (1)(b)(I), (3)(a), (5), and (6); and add19
(3)(e)(III) as follows:20
39-22-550. Tax credit for reducing emissions from certain21
lawn equipment - tax preference performance statement - legislative22
declaration - definitions - report - repeal.23
(1) (b) In accordance with section 39-21-304 (1), which requires24
each bill that creates a new tax expenditure, OR EXTENDS AN EXPIRING25
TAX EXPENDITURE, to include a tax preference performance statement as26
part of a statutory legislative declaration, the general assembly further27
HB26-1289-35-
finds and declares that:1
(I) The general legislative purpose of the tax credit allowed by2
subsection (3) of this section, AND THE GENERAL LEGISLATIVE PURPOSE OF3
ITS EXTENSION, is to induce certain designated behaviors by taxpayers,4
specifically the purchase of electric-powered lawn equipment; and5
(3) (a) For income tax years commencing on or after January 1,6
2024, but before January 1, 2027 JANUARY 1, 2030, a retailer qualified7
pursuant to subsection (3)(e)(II) of this section is allowed a tax credit8
against the tax imposed pursuant to this article 22 in an amount equal to9
thirty-three percent of the aggregate purchase price for all retail sales of10
new, electric-powered lawn equipment that the qualified retailer sold in11
the state during the tax year.12
(e) (III) F OR INCOME TAX YEARS BEGINNING ON OR AFTER13
JANUARY 1, 2027, THE QUALIFIED RETAILER MAY ELECT ADVANCE14
PAYMENTS OF THE CREDIT ALLOWED PURSUANT TO THIS SECTION AS15
SPECIFIED IN SECTION 39-22-629.16
(5) Pursuant to section 39-21-304 (3), notwithstanding section17
24-1-136 (11)(a)(I), and for the purpose of providing data that allows the18
general assembly and the state auditor to measure the effectiveness of the19
tax credit created in subsection (3) of this section, the department of20
revenue, on or before January 1, 2025, and on or before January 1 of each21
year thereafter through January 1, 2028 JANUARY 1, 2031, shall submit to22
the general assembly and the state auditor a report detailing the sales of23
new, electric-powered lawn equipment, as reported by a qualified retailer24
claiming the tax credit authorized under subsection (3) of this section.25
The tax credit established in this section meets its purpose if sales of new,26
gasoline-powered lawn equipment are significantly reduced within five27
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years after the tax credit becomes effective, as determined by the general1
assembly and the state auditor pursuant to section 39-21-304 (3).2
(6) This section is repealed, effective December 31, 20333
DECEMBER 31, 2036.4
SECTION 11. In Colorado Revised Statutes, 39-22-551, amend5
(1)(a), (2)(e)(XI), (2)(j), (6)(a)(I), (9) introductory portion, (11), and (13);6
and add (6.5) as follows:7
39-22-551. Industrial clean energy tax credit - tax preference8
performance statement - definitions - report - repeal.9
(1) (a) In accordance with section 39-21-304 (1), which requires10
each bill that creates a new tax expenditure to include a tax preference11
performance statement as part of a statutory legislative declaration, the12
general assembly finds and declares that the purpose of the tax credit13
provided for in this section is to induce certain designated behavior by14
taxpayers and to provide a reduction in income tax liability for certain15
businesses or individuals by allowing an owner of an industrial facility to16
receive a credit against income tax for the costs associated with17
conducting industrial studies or for implementing a plan to put into18
service greenhouse gas emissions reduction improvements AND, FOR19
INCOME TAX YEARS COMMENCING ON OR AFTER JANUARY 1, 2026, BY20
PROVIDING A FINANCIAL INCENTIVE FOR THE DEVELOPMENT OF THERMAL21
ENERGY NETWORKS AND ELECTRICITY GENERATION FROM GEOTHERMAL22
SOURCES AND BY PROVIDING A FINANCIAL INCENTIVE FOR PRODUCTION OF23
GEOTHERMAL ELECTRICITY GENERATION AND RELATED INFRASTRUCTURE.24
(2) Definitions. As used in this section, unless the context25
otherwise requires:26
(e) "Greenhouse gas emissions reduction improvements" means27
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improvements that help to measurably reduce greenhouse gas emissions.1
"Greenhouse gas emissions reduction improvements" may include one or2
more of the following equipment purchases, improvements, retrofits, or3
investments:4
(XI) Installing equipment used for collection of biomethane, AND,5
FOR INCOME TAX YEARS COMMENCING ON AND AFTER JANUARY 1, 2027,6
INSTALLING EQUIPMENT USED FOR UTILIZATION OF BIOMETHANE;7
(j) "Owner" means a person or developer of a project to be8
implemented at a qualified industrial facility subject to tax under this9
article 22 who applies for and claims the credit allowed by this section.10
FOR INCOME TAX YEARS COMMENCING ON AND AFTER JANUARY 1, 2027,11
"OWNER" ALSO INCLUDES A PERSON OR POLITICAL SUBDIVISION OF THE12
STATE THAT IS A DEVELOPER OF A PROJECT TO BE IMPLEMENTED AT A13
QUALIFIED INDUSTRIAL FACILITY AND THAT IS EXEMPT FROM TAXATION14
UNDER SECTION 39-22-112 (1).15
(6) Merit-based review and reservation of credits.16
(a) (I) For each application period, the office shall conduct a17
merit-based evaluation of the applications that have been placed in the18
evaluation pool pursuant to subsection (5)(c)(II)(B) of this section.19
BEFORE TAX YEARS BEGINNING JANUARY 1, 2027, the office shall20
complete its review, and award reservations, within ninety days after the21
end of the application period. FOR INCOME TAX YEARS COMMENCING ON22
OR AFTER JANUARY 1, 2027, THE OFFICE SHALL COMPLETE ITS REVIEW ,23
AND AWARD RESERVATIONS, WITHIN ONE HUNDRED TWENTY DAYS AFTER24
THE END OF THE APPLICATION PERIOD.25
(6.5) Geothermal energy project tax credits.26
(a) (I) (A) F OR INCOME TAX YEARS COMMENCING ON OR AFTER27
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JANUARY 1, 2026, BUT BEFORE JANUARY 1, 2033, AN ELIGIBLE1
GEOTHERMAL ENERGY PROJECT TAXPAYER THAT MAKES A QUALIFIED2
GEOTHERMAL ENERGY PROJECT EXPENDITURE IS ALLOWED A CREDIT3
AGAINST THE TAX IMPOSED UNDER THIS ARTICLE 22 IN AN APPLICABLE4
AMOUNT AND SUBJECT TO THE LIMITATIONS SET FORTH IN SUBSECTION5
(6.5)(a)(I)(B) OF THIS SECTION.6
(B) AN ELIGIBLE GEOTHERMAL ENERGY PROJECT TAXPAYER IS NOT7
ALLOWED A TAX CREDIT PURSUANT TO THIS SUBSECTION (6.5) IN AN8
AGGREGATE AMOUNT OF MORE THAN FIVE MILLION DOLLARS IN TAX9
CREDITS FOR ALL INCOME TAX YEARS FOR WHICH THE TAX CREDIT MAY BE10
CLAIMED PURSUANT TO THIS SECTION PER APPROVED GEOTHERMAL11
ENERGY PROJECT.12
(II) AN ELIGIBLE GEOTHERMAL ENERGY PROJECT TAXPAYER MAY13
SUBMIT AN APPLICATION TO THE OFFICE FOR A CREDIT IN AN APPLICABLE14
AMOUNT AGAINST THE TAX IMPOSED UNDER THIS ARTICLE 22. THE15
APPLICATION MUST BE IN THE SAME FORM AND SUBMITTED IN THE SAME16
MANNER AS DESCRIBED IN SECTION 39-22-522 (4), AND THE OFFICE SHALL17
DETERMINE WHETHER TO RESERVE THE CREDIT AND THE AMOUNT OF THE18
CREDIT TO RESERVE IN THE SAME MANNER AS DESCRIBED FOR A TAX19
CREDIT IN SECTION 39-22-522.20
(b) (I) F OR INCOME TAX YEARS COMMENCING ON OR AFTER21
JANUARY 1, 2026, AND BEFORE JANUARY 1, 2033, A QUALIFIED22
GEOTHERMAL ENERGY PRODUCING ENTITY IS ALLOWED A CREDIT AGAINST23
THE INCOME TAXES IMPOSED BY THIS ARTICLE 22 IN AN AMOUNT EQUAL TO24
THREE ONE -THOUSANDTHS OF A DOLLAR PER KILOWATT HOUR OF25
GEOTHERMAL ELECTRICITY THAT IS PRODUCED BY THE QUALIFIED26
GEOTHERMAL ENERGY PRODUCING ENTITY IN THE STATE IN THE TAX YEAR,27
HB26-1289-39-
EXCEPT AS MODIFIED BY THE OFFICE PURSUANT TO SUBSECTION1
(6.5)(b)(II) OF THIS SECTION.2
(II) T HE OFFICE SHALL ANNUALLY REVIEW AND EVALUATE THE3
EFFECTIVENESS OF THE TAX CREDIT DESCRIBED IN THIS SUBSECTION4
(6.5)(b) AND MAY MODIFY THE AMOUNTS SET FORTH IN SUBSECTION5
(6.5)(b)(I) OF THIS SECTION. THE OFFICE SHALL MAINTAIN THE CURRENT6
APPLICABLE TAX CREDIT ON ITS WEBSITE AND SHALL PROVIDE THE7
APPLICABLE TAX CREDIT IN WRITING TO THE DEPARTMENT NO LATER THAN8
DECEMBER 31, 2026, AND EACH DECEMBER 31 THEREAFTER THROUGH9
DECEMBER 31, 2031.10
(III) T O CLAIM THE CREDIT DESCRIBED IN THIS SUBSECTION11
(6.5)(b), THE QUALIFIED GEOTHERMAL ENERGY PRODUCING ENTITY MUST12
APPLY FOR A TAX CREDIT CERTIFICATE TO RECEIVE A TAX CREDIT13
CERTIFICATE FROM THE OFFICE IN THE FORM AND MANNER DESCRIBED IN14
SECTION 39-22-553 (4).15
(IV) A QUALIFIED ENTITY THAT CLAIMS THE CREDIT ALLOWED BY16
THIS SECTION MAY NOT CLAIM THE CREDIT ALLOWED BY SECTION17
39-30-104 FOR THE SAME PROJECT.18
(c) NOTWITHSTANDING ANY LAW TO THE CONTRARY:19
(I) T HE OFFICE MUST INCLUDE THE RESERVATION OF A CREDIT20
PURSUANT TO THIS SUBSECTION (6.5) IN DETERMINING THE LIMIT ON THE21
AGGREGATE AMOUNT OF TAX CREDITS AVAILABLE TO BE RESERVED22
PURSUANT TO SUBSECTION (8) OF THIS SECTION;23
(II) SUBSECTIONS (1) TO (6) OF THIS SECTION AND SUBSECTIONS (7)24
AND (12) OF THIS SECTION DO NOT APPLY IN CONNECTION WITH THE25
RESERVATION OF A CREDIT PURSUANT TO THIS SUBSECTION (6.5).26
(d) THE TOTAL AMOUNT OF CREDITS RESERVED AND AWARDED BY27
HB26-1289-40-
THE OFFICE PURSUANT TO THIS SUBSECTION (6.5) MUST NOT EXCEED1
THIRTY-FIVE MILLION DOLLARS ACROSS INCOME TAX YEARS COMMENCING2
ON OR AFTER JANUARY 1, 2026, BUT BEFORE JANUARY 1, 2033.3
(e) A S USED IN THIS SUBSECTION (6.5), UNLESS THE CONTEXT4
OTHERWISE REQUIRES:5
(I) "APPLICABLE AMOUNT" HAS THE SAME MEANING AS IN SECTION6
39-22-552 (2)(a).7
(II) "APPROVED GEOTHERMAL ENERGY PROJECT" HAS THE SAME8
MEANING AS IN SECTION 39-22-552 (2)(b).9
(III) "ELIGIBLE GEOTHERMAL ENERGY PROJECT TAXPAYER" HAS10
THE SAME MEANING AS "ELIGIBLE TAXPAYER", AS DEFINED IN SECTION11
39-22-552 (2)(e).12
(IV) "QUALIFIED GEOTHERMAL ENERGY PRODUCING ENTITY" HAS13
THE SAME MEANING AS "QUALIFIED ENTITY ", AS DEFINED IN SECTION14
39-22-553 (2)(c).15
(V) "Q UALIFIED GEOTHERMAL ENERGY PROJECT EXPENDITURE "16
HAS THE SAME MEANING AS "QUALIFIED EXPENDITURE", AS DEFINED IN17
SECTION 39-22-552 (2)(g).18
(9) The office shall, in a sufficiently timely manner to allow the19
department to process returns claiming the income tax credit allowed in20
this section, provide the department with an electronic report of each21
owner TAXPAYER to which the office has issued a tax credit certificate, as22
allowed in subsection SUBSECTIONS (6.5) AND (7) of this section, for the23
preceding tax year that includes the following information:24
(11) In order To claim the credit authorized by this section, the25
owner TAXPAYER shall file the tax credit certificate with the owner's26
TAXPAYER'S state income tax return. The amount of the credit that the27
HB26-1289-41-
owner TAXPAYER may claim under this section is the amount stated on the1
tax credit certificate.2
(13) If a credit authorized by this section exceeds the income tax3
due on the income of the owner TAXPAYER for the taxable year, the4
excess credit may not be carried forward and must be refunded to the5
owner TAXPAYER.6
SECTION 12. In Colorado Revised Statutes, 39-22-554, amend7
(3)(f) as follows:8
39-22-554. Heat pump technology and thermal energy9
network tax credit - tax preference performance statement -10
legislative declaration - definitions - repeal.11
(3) (f) (I) If the June 2025 revenue forecast, and each June12
revenue forecast through the June 2031 revenue forecast as prepared by13
either legislative council staff or the office of state planning and14
budgeting, projects that state revenues, as defined in section 24-77-103.615
(6)(c), will not increase by at least four percent for the next fiscal year,16
the amount of the credit allowed pursuant to subsection (3)(c)(I)(B),17
(3)(c)(I)(C), (3)(c)(II)(B), (3)(c)(II)(C), or (3)(c)(III)(B) of this section,18
as may be modified by subsections (3)(d) and (3)(e) of this section, for19
any tax year commencing in the calendar year that begins during said next20
fiscal year is reduced by fifty percent if the heat pump technology is21
installed at an existing residential or nonresidential building; except that22
if the amount of the reduced credit is equal to or less than two hundred23
fifty dollars, then no credit is available for such a THAT INCOME tax year.24
(II) THIS SUBSECTION (3)(f) IS REPEALED, EFFECTIVE DECEMBER25
31, 2031.26
SECTION 13. In Colorado Revised Statutes, 39-22-555, amend27
HB26-1289-42-
(6) as follows:1
39-22-555. Electric bicycle tax credit - tax preference2
performance statement - legislative declaration - definitions - repeal.3
(6) (a) If the June 2025 revenue forecast, and each June revenue4
forecast through the June 2031 revenue forecast as prepared by either5
legislative council sta ff or the office of st ate planning and budgeting,6
projects that state revenues, as defined in section 24-77-103.6 (6)(c), will7
not increase by at least four percent for the next fiscal year, the amount8
of the credit allowed pursuant to this section, the discount required9
pursuant to subsection (3)(b) of this section, and the administrative fee10
allowed pursuant to subsection (3)(d) of this section for any tax year11
commencing in the calendar year that begins during said next fiscal year,12
is reduced by fifty percent.13
(b) THIS SUBSECTION (6) IS REPEALED, EFFECTIVE DECEMBER 31,14
2031.15
SECTION 14. In Colorado Revised Statutes, 39-22-556, amend16
(3)(a), (4)(b), (7), and (9) as follows:17
39-22-556. Tax credit for sustainable aviation fuel production18
facility - tax p reference p erformance statement - legislative19
declaration - definitions - repeal.20
(3) (a) For tax years commencing on or after January 1, 2024, but21
before January 1, 2033 JANUARY 1, 2027, a qualified taxpayer is allowed22
a credit against the income tax imposed under this article 22 for an23
amount of the actual cost paid to construct, reconstruct, or erect a24
sustainable aviation fuel production facility in the state equal to:25
(I) Thirty percent for a facility for which construction begins on26
or after January 1, 2024, but before January 1, 2027;27
HB26-1289-43-
(II) Twenty-four percent for a facility for which construction1
begins on or after January 1, 2027, but before January 1, 2028;2
(III) Eighteen percent for a facility for which construction begins3
on or after January 1, 2028, but before January 1, 2029; and4
(IV) Twelve percent for a facility for which construction begins5
on or after January 1, 2029, but before January 1, 2033.6
(4) (b) The aggregate amount of all tax credit certificates issued7
by the office pursuant to this subsection (4) must not exceed one million8
dollars for the 2024 income tax year, two million dollars per year for the9
2025 and 2026 income tax years, and three million dollars per year for10
income tax years 2027 through 2032 YEAR.11
(7) Notwithstanding the requirement in section 24-1-13612
(11)(a)(I), for the purpose of providing data that allows the general13
assembly and the state auditor to measure the effectiveness of the credit14
created in subsection (3) of this section pursuant to section 39-21-304 (3),15
the office on or before January 1, 2026, and on or before January 1 of16
each year thereafter until January 1, 2034 JANUARY 1, 2027, shall submit17
to the general assembly and the state auditor a report detailing the18
construction, reconstruction, and erection of sustainable aviation fuel19
production facilities as reported by qualified taxpayers claiming the credit20
in this section. The tax credit meets its purpose if the construction,21
reconstruction, and erection of sustainable aviation fuel production22
facilities in the state increase significantly in tax years for which the23
credit is allowed.24
(9) This section is repealed, effective December 31, 203825
DECEMBER 31, 2033.26
SECTION 15. In Colorado Revised Statutes, add 39-22-556.5 as27
HB26-1289-44-
follows:1
39-22-556.5. Tax credit for the purchase of sustainable2
aviation fuel - tax preference performance statement - legislative3
declaration - definitions - repeal.4
(1) (a) I N ACCORDANCE WITH SECTION 39-21-304 (1), WHICH5
REQUIRES EACH BILL THAT CREATES A NEW TAX EXPENDITURE TO INCLUDE6
A TAX PREFERENCE PERFORMANCE STATEMENT AS PART OF A STATUTORY7
LEGISLATIVE DECLARATION , THE GENERAL ASSEMBLY FINDS AND8
DECLARES THAT THE PURPOSE OF THIS TAX EXPENDITURE IS TO INDUCE9
CERTAIN DESIGNATED BEHAVIOR BY TAXPAYERS , SPECIFICALLY THE10
PURCHASE OF SUSTAINABLE AVIATION FUEL IN THE STATE, BY PROVIDING11
TAX RELIEF FOR CERTAIN BUSINESSES AND INDIVIDUALS THAT PURCHASE12
SUSTAINABLE AVIATION FUEL IN THE STATE.13
(b) T HE GENERAL ASSEMBLY AND THE STATE AUDITOR SHALL14
MEASURE THE EFFECTIVENESS OF THE CREDIT IN ACHIEVING THE PURPOSES15
SPECIFIED IN SUBSECTION (1)(a) OF THIS SECTION BASED ON THE16
INFORMATION REQUIRED BY AND REPORTED TO THE DEPARTMENT17
PURSUANT TO SUBSECTION (5) OF THIS SECTION.18
(2) AS USED IN THIS SECTION, UNLESS THE CONTEXT OTHERWISE19
REQUIRES:20
(a) "C OLORADO ENERGY OFFICE " OR "OFFICE" MEANS THE21
COLORADO ENERGY OFFICE CREATED IN SECTION 24-38.5-101.22
(b) "DEPARTMENT" MEANS THE DEPARTMENT OF REVENUE.23
(c) "Q UALIFIED TAXPAYER" MEANS A PERSON WHO PURCHASES24
SUSTAINABLE AVIATION FUEL IN THE STATE IF THAT PERSON IS SUBJECT TO25
TAX PURSUANT TO THIS ARTICLE 22 OR IS A PERSON OR POLITICAL26
SUBDIVISION OF THE STATE THAT IS EXEMPT FROM TAXATION PURSUANT27
HB26-1289-45-
TO SECTION 39-22-112 (1).1
(d) "SUSTAINABLE AVIATION FUEL " HAS THE SAME MEANING AS2
SET FORTH IN SECTION 40B (d) OF THE INTERNAL REVENUE CODE.3
(3) (a) FOR TAX YEARS COMMENCING ON OR AFTER JANUARY 1,4
2027, BUT BEFORE JANUARY 1, 2033, A QUALIFIED TAXPAYER IS ALLOWED5
A CREDIT AGAINST THE INCOME TAX IMPOSED UNDER THIS ARTICLE 22 IN6
AN AMOUNT EQUAL TO ONE DOLLAR AND FIFTY CENTS, INCREASED BY ONE7
CENT FOR EACH WHOLE PERCENTAGE OF CARBON INTENSITY REDUCTION8
IN EXCESS OF FIFTY PERCENT , FOR EACH GALLON OF SUSTAINABLE9
AVIATION FUEL THAT THE QUALIFIED TAXPAYER PURCHASED IN THE STATE10
DURING THE INCOME TAX YEAR , EXCEPT AS OTHERWISE PROVIDED IN11
SUBSECTION (3)(b) OF THIS SECTION.12
(b) T HE OFFICE SHALL ANNUALLY REVIEW AND EVALUATE THE13
EFFECTIVENESS OF THE TAX CREDIT ALLOWED PURSUANT TO THIS SECTION14
AND MAY, NOTWITHSTANDING SUBSECTION (3)(a) OF THIS SECTION, FOR15
THE SUBSEQUENT TAX YEAR , MODIFY THE AMOUNT PER GALLON ,16
INCLUDING THE INCREASE AS A RESULT OF CARBON INTENSITY REDUCTION,17
THAT A QUALIFIED TAXPAYER IS ALLOWED AS A CREDIT AGAINST THE18
INCOME TAX IMPOSED UNDER THIS ARTICLE 22 PURSUANT TO THIS19
SECTION. THE OFFICE SHALL POST THE MODIFIED AMOUNT ON ITS WEBSITE.20
(4) (a) A QUALIFIED TAXPAYER SHALL SUBMIT AN APPLICATION TO21
THE OFFICE FOR A TAX CREDIT CERTIFICATE TO CLAIM THE CREDIT22
ALLOWED BY THIS SECTION ON A FORM AND IN A MANNER PRESCRIBED BY23
THE OFFICE. THE APPLICATION MUST INCLUDE INFORMATION TO ALLOW24
THE OFFICE TO MAKE A DETERMINATION THAT THE APPLICANT IS A25
QUALIFIED TAXPAYER AND THAT THE AMOUNT OF SUSTAINABLE AVIATION26
FUEL THAT THE QUALIFIED TAXPAYER PURCHASED IN THE STATE DURING27
HB26-1289-46-
THE INCOME TAX YEAR.1
(b) THE AGGREGATE AMOUNT OF ALL TAX CREDIT CERTIFICATES2
ISSUED BY THE OFFICE PURSUANT TO THIS SUBSECTION (4) MUST NOT3
EXCEED THREE MILLION DOLLARS PER YEAR FOR ANY INCOME TAX YEAR.4
(c) T HE OFFICE SHALL , IN A SUFFICIENTLY TIMELY MANNER TO5
ALLOW THE DEPARTMENT TO PROCESS RETURNS CLAIMING THE INCOME6
TAX CREDIT ALLOWED IN THIS SECTION, PROVIDE THE DEPARTMENT WITH7
AN ELECTRONIC REPORT OF EACH QUALIFIED TAXPAYER THAT THE OFFICE8
APPROVED FOR THE INCOME TAX CREDIT ALLOWED IN THIS SECTION FOR9
THE PRECEDING CALENDAR YEAR THAT INCLUDES THE FOLLOWING10
INFORMATION:11
(I) THE TAXPAYER'S NAME;12
(II) T HE TAXPAYER 'S SOCIAL SECURITY NUMBER OR THE13
TAXPAYER'S COLORADO ACCOUNT NUMBER AND FEDERAL EMPLOYER14
IDENTIFICATION NUMBER; AND15
(III) THE AMOUNT OF THE TAX CREDIT CERTIFICATE.16
(d) THE OFFICE SHALL DEVELOP STANDARDS FOR THE APPROVAL17
OF QUALIFIED TAXPAYERS FOR WHOM A TAX CREDIT UNDER THIS SECTION18
IS ALLOWED AND THE AWARDING OF TAX CREDIT CERTIFICATES PURSUANT19
TO THIS SUBSECTION (4) AND SHALL POST THOSE STANDARDS ON ITS20
WEBSITE.21
(5) NOTWITHSTANDING THE REQUIREMENT IN SECTION 24-1-13622
(11)(a)(I), FOR THE PURPOSE OF PROVIDING DATA THAT ALLOWS THE23
GENERAL ASSEMBLY AND THE STATE AUDITOR TO MEASURE THE24
EFFECTIVENESS OF THE CREDIT CREATED IN SUBSECTION (3) OF THIS25
SECTION PURSUANT TO SECTION 39-21-304 (3), THE OFFICE, ON OR BEFORE26
JANUARY 1, 2028, AND ON OR BEFORE JANUARY 1 OF EACH YEAR27
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THEREAFTER UNTIL JANUARY 1, 2034, SHALL SUBMIT TO THE GENERAL1
ASSEMBLY AND THE STATE AUDITOR A REPORT DETAILING THE PURCHASE2
OF SUSTAINABLE AVIATION FUEL BY TAXPAYERS CLAIMING THE CREDIT IN3
THIS SECTION. THE TAX CREDIT MEETS ITS PURPOSE IF THE PURCHASE OF4
SUSTAINABLE AVIATION FUEL PRODUCTION IN THE STATE INCREASES5
SIGNIFICANTLY IN TAX YEARS FOR WHICH THE CREDIT IS ALLOWED.6
(6) I F THE CREDIT AUTHORIZED BY THIS SECTION EXCEEDS THE7
INCOME TAX DUE ON THE INCOME OF THE QUALIFIED TAXPAYER FOR THE8
TAXABLE YEAR, THE EXCESS CREDIT MAY NOT BE CARRIED FORWARD AND9
MUST BE REFUNDED TO THE QUALIFIED TAXPAYER.10
(7) THIS SECTION IS REPEALED , EFFECTIVE DECEMBER 31, 2038. 11
SECTION 16. In Colorado Revised Statutes, 39-22-629, amend12
(1)(a) as follows:13
39-22-629. Advance payments of income tax credits -14
definitions.15
(1) As used in this section, unless the context otherwise requires:16
(a) "Applicable credit" means:17
(I) F OR INCOME TAX YEARS COMMENCING BEFORE JANUARY 1,18
2027, the credits allowed in sections 39-22-516.7, 39-22-516.8, and19
39-22-555; AND20
(II) FOR INCOME TAX YEARS COMMENCING ON OR AFTER JANUARY21
1, 2027, THE CREDITS ALLOWED IN SECTIONS 39-22-516.7, 39-22-516.8,22
39-22-549, 39-22-550, AND 39-22-555.23
SECTION 17. In Colorado Revised Statutes, 39-26-706, amend24
(4) as follows:25
39-26-706. Miscellaneous sales and use tax exemptions -26
internet access - refractory materials - precious metal bullion and27
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coins - repeal.1
(4) (a) B EFORE JANUARY 1, 2027, all sales of precious metal2
bullion and coins, as defined in section 39-26-102 (2.6) and (6.5), shall3
be exempt from taxation under the provisions of part 1 of this article4
ARTICLE 26.5
(b) BEFORE JANUARY 1, 2027, the storage, use, or consumption of6
precious metal bullion and coins, as defined in section 39-26-102 (2.6)7
and (6.5), shall be exempt from taxation under the provisions of part 2 of8
this article ARTICLE 26.9
(c) THIS SUBSECTION (4) IS REPEALED, EFFECTIVE DECEMBER 31,10
2029.11
SECTION 18. In Colorado Revised Statutes, 39-26-710, amend12
(1)(a) and (2); and add (2.5) as follows:13
39-26-710. Railroads - construction and building materials -14
tangible personal property - work equipment - rolling stock - tax15
preference performance statement - legislative declaration.16
(1) The following shall be exempt from taxation under the17
provisions of part 1 of this article:18
(a) The sale of construction and building materials to a common19
carrier by rail operating in interstate or foreign commerce for use by the20
common carrier in construction and maintenance of its railroad tracks;21
however, any actual use of such construction and building materials shall,22
at the time of the actual use, be subject to the tax imposed by part 2 of this23
article and any use tax imposed pursuant to article 2 of title 29, C.R.S.,24
THIS TITLE 39, EXCEPT AS PROVIDED IN SUBSECTION (2)(c) OF THIS25
SECTION;26
(2) The following shall be exempt from taxation under the27
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provisions of part 2 of this article ARTICLE 26:1
(a) The storage, use, or consumption of any tangible personal2
property that is to be affixed or attached as a component part of a3
locomotive, a freight car, railroad work equipment, or other railroad4
rolling stock; and5
(b) The storage, use, or consumption of locomotives, freight cars,6
railroad work equipment, and other railroad rolling stock used or7
purchased for use in interstate commerce by a railroad company; AND8
(c) FOR TAX PERIODS BEGINNING ON OR AFTER JULY 1, 2027, THE9
STORAGE, USE , OR CONSUMPTION OF CONSTRUCTION AND BUILDING10
MATERIALS BY OR ON BEHALF OF A COMMON CARRIER BY RAIL OPERATING11
IN INTERSTATE OR FOREIGN COMMERCE WHEN THE STORAGE , USE , OR12
CONSUMPTION OF THE CONSTRUCTION AND BUILDING MATERIALS IS13
PURSUANT TO A CONTRACT WITH THE STATE , A DEPARTMENT OR14
INSTITUTION OF THE STATE, A POLITICAL SUBDIVISION OF THE STATE, OR15
A SPECIAL DISTRICT THAT ALLOWS THE STATE , A DEPARTMENT OR16
INSTITUTION OF THE STATE, A POLITICAL SUBDIVISION OF THE STATE, OR17
A SPECIAL DISTRICT TO USE THE RAILROAD 'S PROPERTY OR TRACKS FOR18
THE PROVISION OF PUBLIC PASSENGER RAIL SERVICE.19
(2.5) I N ACCORDANCE WITH SECTION 39-21-304 (1), WHICH20
REQUIRES ANY BILL THAT CREATES A NEW TAX EXPENDITURE TO INCLUDE21
A TAX PREFERENCE PERFORMANCE STATEMENT AS PART OF A STATUTORY22
LEGISLATIVE DECLARATION , THE GENERAL ASSEMBLY FINDS AND23
DECLARES THAT THE PURPOSE OF THE TAX EXEMPTION PROVIDED IN24
SUBSECTION (2)(c) OF THIS SECTION IS TO INDUCE CERTAIN DESIGNATED25
BEHAVIOR BY TAXPAYERS BY ENCOURAGING A RAILROAD TO ALLOW26
CERTAIN PUBLIC ENTITIES TO USE THE RAILROAD'S PROPERTY OR TRACKS27
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FOR THE PROVISION OF PUBLIC PASSENGER RAIL SERVICE . THE GENERAL1
ASSEMBLY AND THE STATE AUDITOR SHALL MEASURE THE EFFECTIVENESS2
OF THE EXEMPTION IN ACHIEVING THIS PURPOSE BASED ON THE VALUE OF3
THE EXEMPTION AND THE NUMBER OF INSTANCES WHERE THE RAILROAD4
ALLOWED A PUBLIC ENTITY TO USE THE RAILROAD'S PROPERTY OR TRACKS5
FOR THE PROVISION OF PUBLIC PASSENGER RAIL SERVICE.6
SECTION 19. In Colorado Revised Statutes, 39-26-723, amend7
(1) and (3); and add (2.5) as follows:8
39-26-723. Colorado wood products - repeal - tax preference9
performance statement - legislative declaration.10
(1) For STATE fiscal years commencing on or after July 1, 2008,11
but prior to the STATE fiscal year commencing on July 1, 2020, and for12
STATE fiscal years commencing on or after July 1, 2021, but prior to the13
STATE fiscal year commencing on July 1, 2026, AND FOR STATE FISCAL14
YEARS COMMENCING ON OR AFTER JULY 1, 2027, BUT PRIOR TO THE STATE15
FISCAL YEAR COMMENCING ON JULY 1, 2031, all sales, storage, and use of16
wood from salvaged trees killed or infested in Colorado by mountain pine17
beetles or spruce beetles, including but not limited to products such as18
lumber, furniture built from the salvaged trees, and wood chips or wood19
pellets generated from the salvaged trees, are exempt from taxation under20
the provisions of parts 1 and 2 of this article 26.21
(2.5) I N ACCORDANCE WITH SECTION 39-21-304 (1), WHICH22
REQUIRES ANY BILL THAT EXTENDS AN EXPIRING TAX EXPENDITURE TO23
INCLUDE A TAX PREFERENCE PERFORMANCE STATEMENT AS PART OF A24
STATUTORY LEGISLATIVE DECLARATION, THE GENERAL ASSEMBLY FINDS25
AND DECLARES THAT THE PURPOSE OF THE TAX CREDIT PROVIDED IN26
SUBSECTION (1)(a) OF THIS SECTION IS TO INDUCE CERTAIN DESIGNATED27
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BEHAVIOR BY TAXPAYERS BY CONTINUING TO ENCOURAGE THE SALE ,1
STORAGE, AND USE OF WOOD FROM SALVAGED TREES KILLED OR INFESTED2
IN COLORADO BY MOUNTAIN PINE BEETLES OR SPRUCE BEETLES . THE3
GENERAL ASSEMBLY AND THE STATE AUDITOR SHALL MEASURE THE4
EFFECTIVENESS OF THE CREDIT IN ACHIEVING THIS PURPOSE BASED ON THE5
NUMBER AND VALUE OF CREDITS ISSUED AND THE AMOUNT OF WOOD6
SALVAGED.7
(3) This section is repealed, effective July 1, 2027 JULY 1, 2034.8
SECTION 20. In Colorado Revised Statutes, 39-26-728, amend9
(1); and add (5) as follows:10
39-26-728. Property for use in space flight - definitions -11
repeal.12
(1) For the state fiscal years commencing on or after July 1, 2014,13
All sales, storage, and use of qualified property, ON OR AFTER JULY 1,14
2014, BUT BEFORE JANUARY 1, 2027, for use in space flight is exempt15
from taxation under parts 1 and 2 of this article ARTICLE 26.16
(5) THIS SECTION IS REPEALED, EFFECTIVE DECEMBER 31, 2029.17
SECTION 21. In Colorado Revised Statutes, 39-27-102, amend18
(1)(b)(I) as follows:19
39-27-102. Tax imposed on gasoline and special fuel - deposits20
- penalties.21
(1) (b) (I) In the case of gasoline or special fuel removed from a22
terminal, the tax is imposed upon the person first receiving the gasoline23
or special fuel at the terminal even if such person is also the supplier. In24
the case of gasoline or special fuel removed from a terminal by a common25
carrier, the consignor who owns the gasoline or special fuel removed by26
the common carrier is deemed to be the remover and first recipient27
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thereof. The amount of gasoline or special fuel removed is deemed to be1
the amount shipped from the terminal, measured in gallons, as shown by2
the terminal manifest; except that, FOR TAX PERIODS BEGINNING BEFORE3
JANUARY 1, 2027, THE LICENSED DISTRIBUTOR SHALL DEDUCT an4
allowance of two percent of the total amount of gasoline or special fuel5
acquired during any calendar month, as shown by terminal manifests, is6
deducted by the licensed distributor to cover losses in transit and in7
unloading the gasoline or special fuel but there is no allowance for8
liquefied petroleum gas or removal by bulk transfer, AND, FOR TAX9
PERIODS BEGINNING ON OR AFTER JANUARY 1, 2027, THE LICENSED10
DISTRIBUTOR SHALL DEDUCT AN ALLOWANCE OF ONE PERCENT OF THE11
TOTAL AMOUNT OF GASOLINE OR SPECIAL FUEL ACQUIRED DURING ANY12
CALENDAR MONTH , AS SHOWN BY TERMINAL MANIFESTS , TO COVER13
LOSSES IN TRANSIT AND IN UNLOADING THE GASOLINE OR SPECIAL FUEL,14
BUT THERE IS NO ALLOWANCE FOR LIQUEFIED PETROLEUM GAS OR15
REMOVAL BY BULK TRANSFER. The two percent allowance provided under16
this subsection (1)(b)(I) is allowed whether the terminal is within or17
without this OUTSIDE OF THE state.18
SECTION 22. In Colorado Revised Statutes, 39-27-105, amend19
(2)(a)(I) and (2)(b) as follows:20
39-27-105. Collection of tax on gasoline and special fuel - rules21
- repeal.22
(2) (a) (I) It is the duty of every distributor of gasoline or special23
fuel other than liquefied petroleum gas to compute the amount of tax24
payable on all gasoline or special fuel imported, removed from a terminal,25
or otherwise acquired during the preceding calendar month at the rate of26
tax per gallon imposed thereon in section 39-27-102 (1). and In27
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computing the amount of tax FOR TAX PERIODS BEGINNING BEFORE1
JANUARY 1, 2027, THE DISTRIBUTOR SHALL TAKE INTO ACCOUNT the2
allowance of two percent provided for in section 39-27-102 (1)(b)(I). (A)3
shall be taken into account, IN COMPUTING THE AMOUNT OF TAX FOR TAX4
PERIODS BEGINNING ON OR AFTER JANUARY 1, 2027, THE DISTRIBUTOR5
SHALL TAKE INTO ACCOUNT THE ALLOWANCE OF ONE PERCENT PROVIDED6
FOR IN SECTION 39-27-102 (1)(b)(I).7
(b) (I) F OR TAX PERIODS BEGINNING BEFORE JANUARY 1, 2027,8
from the amount of tax computed under subsection (2)(a) of this section,9
the distributor shall deduct one-half of one percent to cover expenses of10
payment of the tax and bad debt losses and shall pay the remaining11
balance to the department of revenue and file the statement required by12
subsection (1) of this section on or before the twenty-sixth day of each13
calendar month. FOR TAX PERIODS BEGINNING BEFORE JANUARY 1, 2027,14
if any distributor is delinquent in remitting the tax, except in unusual15
circumstances shown to the satisfaction of the executive director of the16
department of revenue, the retailer shall not be allowed to deduct any17
amount under this subsection (2)(b).18
(II) FOR TAX PERIODS BEGINNING ON OR AFTER JANUARY 1, 2027,19
THE DISTRIBUTOR SHALL FILE THE STATEMENT REQUIRED BY SUBSECTION20
(1) OF THIS SECTION AND SHALL PAY THE AMOUNT OF TAX COMPUTED21
UNDER SUBSECTION (2)(a) OF THIS SECTION ON OR BEFORE THE22
TWENTY-SIXTH DAY OF EACH CALENDAR MONTH.23
(III) SUBSECTION (2)(b)(I) OF THIS SECTION AND THIS SUBSECTION24
(2)(b)(III) ARE REPEALED, EFFECTIVE DECEMBER 31, 2029.25
SECTION 23. In Colorado Revised Statutes, 39-28-103.3,26
amend (4) as follows:27
HB26-1289-54-
39-28-103.3. Inventory tax - definition.1
(4) Every wholesaler and wholesale subcontractor shall file a2
report, on a form created by the department, of the inventory identified in3
accordance with subsection (3) of this section and pay the tax imposed4
under this section for the inventory. A wholesaler shall separately identify5
the number of packages with a Colorado tax stamp and the unaffixed6
Colorado tax stamps. The wholesaler or wholesale subcontractor shall7
remit the tax payment on or before the tenth day of the month following8
the required inventory. FOR TAX PERIODS BEGINNING BEFORE JANUARY 1,9
2027, if payment is made on or before the due date, the wholesaler or10
wholesale subcontractor may deduct three percent of the tax imposed11
under this section, but, if any wholesaler or wholesale subcontractor is12
delinquent in remitting such payment, other than in unusual circumstances13
shown to the satisfaction of the executive director of the department, the14
wholesaler or wholesale subcontractor shall not be allowed to retain any15
amounts to cover the expense in collecting and remitting the tax and the16
penalty imposed under section 39-28-108 (2) applies.17
SECTION 24. In Colorado Revised Statutes, 39-28-104, amend18
(1)(a)(I) as follows:19
39-28-104. Evidence of payment of tax - credits - redemptions20
- repeal.21
(1) (a) (I) Payment of the taxes imposed by sections 39-28-10322
and 39-28-103.5 and section 21 of article X of the state constitution shall23
be evidenced by the affixing of stamps to, or by an imprint or impression24
by suitable metering machines approved by the department on, packages25
containing cigarettes. The department shall procure stamps of such design26
and legend as it deems necessary and suitable for the purpose. Except as27
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provided in THIS subsection (1), (b) of this section the department shall1
sell such stamps for cash to licensed wholesalers at a discount of four2
percent of their face value for sales occurring after July 1, 2005, but3
before January 1, 2021, and four-tenths percent of their face value for4
sales occurring on and after January 1, 2021, BUT BEFORE JANUARY 1,5
2027, if payment is made on or before the tenth day of the month6
following the month in which the purchase is made to cover the licensed7
wholesaler's expense in the collection and remittance of such tax; but, if8
any licensed wholesaler is delinquent in remitting such payment, other9
than in unusual circumstances shown to the satisfaction of the executive10
director of the department, the licensed wholesaler shall not be allowed11
to retain any amounts THAT MAY BE AVAILABLE FOR TAX PERIODS BEFORE12
JANUARY 1, 2027, to cover his or her THE WHOLESALER'S expense in13
collecting and remitting said tax, and, in addition, FOR ANY TAX PERIOD,14
the penalty imposed under section 39-28-108 (2) shall apply. The15
department shall keep accurate records of all stamps sold to each16
wholesaler. No wholesaler shall sell or transfer any stamps purchased17
pursuant to this article 28.18
SECTION 25. In Colorado Revised Statutes, 39-28-108, amend19
(2)(b) as follows:20
39-28-108. Penalty.21
(2) (b) If a person fails to pay the tax in the time allowed for the22
discount in REQUIRED PURSUANT TO section 39-28-104 (1) or23
39-28-103.3, a penalty equal to ten percent thereof plus one-half of one24
percent per month from the date when due, not to exceed eighteen percent25
in the aggregate, together with interest on such delinquent taxes at the rate26
computed under section 39-21-110.5, shall apply.27
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SECTION 26. In Colorado Revised Statutes, 39-28.5-106,1
amend (2) as follows:2
39-28.5-106. Returns and remittance of tax - civil penalty.3
(2) Every distributor and remote retail seller shall file a return4
with the department by the twentieth day of the month following the5
month reported and shall therewith remit the amount of tax due, less three6
and one-third percent of any sum so remitted that consists of tax collected7
after July 1, 2005, but before January 1, 2021, and less one and six-tenths8
percent of any sum so remitted that consists of tax collected on or after9
January 1, 2021, BUT BEFORE JANUARY 1, 2027, to cover the distributor's10
or remote retail seller's expense in the collection and remittance of said11
tax; except that no part of the tax imposed pursuant to section12
39-28.5-102.5 and section 21 of article X of the state constitution shall be13
subject to the discount provided for in this subsection (2). If any14
distributor or remote retail seller is delinquent in remitting said tax, other15
than in unusual circumstances shown to the satisfaction of the executive16
director of the department, the distributor or remote retail seller shall not17
be allowed to retain any amounts ALLOWED FOR TAX PERIODS BEFORE18
JANUARY 1, 2027, to cover his or her THE DISTRIBUTOR 'S expense in19
collecting and remitting said tax, and in addition, FOR ANY TAX PERIOD,20
the penalty imposed under section 39-28.5-110 (2)(b) shall apply.21
SECTION 27. In Colorado Revised Statutes, 39-28.6-107,22
amend (2) as follows:23
39-28.6-107. Returns and remittance of tax - civil penalty -24
rules.25
(2) Every distributor shall file a return with the department by the26
twentieth day of the month following the month reported and shall27
HB26-1289-57-
therewith remit the amount of tax due. less FOR TAX PERIODS BEGINNING1
BEFORE JANUARY 1, 2027, A DISTRIBUTOR IS ENTITLED TO CLAIM A2
DISCOUNT OF one and one-tenth percent of any amount remitted to cover3
the distributor's expense in the collection and remittance of the tax. For4
tax periods beginning before January 1, 2027, If any distributor is5
delinquent in remitting the tax, other than in unusual circumstances6
shown to the satisfaction of the executive director of the department, the7
distributor is not allowed to retain any amounts ALLOWED FOR TAX8
PERIODS BEFORE JANUARY 1, 2027, to cover his or her THE DISTRIBUTOR'S9
expense in collecting and remitting the tax and, in addition, FOR ANY TAX10
PERIOD, the penalty imposed under section 39-28.6-111 (2)(b) applies.11
SECTION 28. In Colorado Revised Statutes, 39-30-104, amend12
(1)(b)(II), (2)(c)(I) introductory portion, and (2.6)(a) introductory portion;13
and add (4)(c) and (8) as follows:14
39-30-104. Credit against tax - investment in certain property15
- definitions - repeal - tax preference performance statement -16
legislative declaration.17
(1) (b) (II) FOR INCOME TAX YEARS BEGINNING BEFORE JANUARY18
1, 2027, the income tax credit for a qualified investment in a commercial19
truck, truck tractor, tractor, or semitrailer with a gross vehicle weight20
rating of fifty-four thousand pounds or greater that is model year 2010 or21
newer and is designated as Class A personal property as specified in22
section 42-3-106 (2)(a) C.R.S., as well as any parts associated with the23
vehicle at the time of purchase, shall be allowed in an amount equal to24
one and one-half of one percent of the total qualified investment if the25
model year of the commercial truck, truck tractor, tractor, or semitrailer26
was sold as new during such income tax year;27
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(2) (c) (I) For income tax years commencing on or after January1
1, 2014, except as provided in sections 24-46-104.3 and 24-46-108 and2
subsection (2)(c)(II) of this section, the amount OF THE CREDIT SET FORTH3
IN SUBSECTION (1) OF THIS SECTION that may be claimed by a taxpayer for4
an income tax year and that is not applied or refunded under section5
24-46-108 is limited to the lesser of:6
(2.6) (a) Except as provided in section 24-46-104.3 and subsection7
(2.6)(b) of this section and notwithstanding any other provision in this8
section, in each income tax year commencing on or after January 1, 2015,9
but before January 1, 2021, AND IN EACH INCOME TAX YEAR COMMENCING10
ON OR AFTER JANUARY 1, 2027, a taxpayer who places a new renewable11
energy investment in service on or after January 1, 2015, but before12
January 1, 2021, OR WHO PLACES A NEW RENEWABLE ENERGY13
INVESTMENT IN SERVICE ON OR AFTER JANUARY 1, 2027, that results in a14
credit pursuant to subsection (1) of this section may elect to receive a15
refund of eighty percent of the amount of such credit as specified in this16
subsection (2.6)(a) and forego the remaining twenty percent as a cost of17
such election. If eighty percent of the amount of the credit in subsection18
(1) of this section is:19
(4) (c) I F THE AMOUNT OF THE CREDIT ALLOWED PURSUANT TO20
SUBSECTION (1) OF THIS SECTION EXCEEDS THE AMOUNT OF INCOME TAXES21
OTHERWISE DUE ON THE INCOME OF THE TAXPAYER IN THE INCOME TAX22
YEAR FOR WHICH THE CREDIT IS CLAIMED , THE AMOUNT OF THE CREDIT23
NOT USED AS AN OFFSET AGAINST INCOME TAXES IN THE CURRENT INCOME24
TAX YEAR MAY BE CARRIED FORWARD AND USED AS A CREDIT AGAINST25
INCOME TAX LIABILITY IN SUBSEQUENT YEARS FOR A PERIOD NOT TO26
EXCEED FOURTEEN YEARS AND MUST BE APPLIED FIRST TO THE EARLIEST27
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POSSIBLE INCOME TAX YEAR. ANY CREDIT REMAINING AFTER THAT PERIOD1
IS NOT REFUNDED OR CREDITED TO THE TAXPAYER.2
(8) I N ACCORDANCE WITH SECTION 39-21-304 (1), WHICH3
REQUIRES ANY BILL THAT EXTENDS AN EXPIRING TAX EXPENDITURE TO4
INCLUDE A TAX PREFERENCE PERFORMANCE STATEMENT AS PART OF A5
STATUTORY LEGISLATIVE DECLARATION, THE GENERAL ASSEMBLY FINDS6
AND DECLARES THAT THE PURPOSE OF THE TAX CREDIT PROVIDED IN7
SUBSECTION (1) OF THIS SECTION IS TO INDUCE CERTAIN DESIGNATED8
BEHAVIOR BY TAXPAYERS BY CONTINUING TO SUPPORT THE DEVELOPMENT9
OF NEW RENEWABLE ENERGY INVESTMENTS IN ENTERPRISE ZONES . THE10
GENERAL ASSEMBLY AND THE STATE AUDITOR SHALL MEASURE THE11
EFFECTIVENESS OF THE CREDIT IN ACHIEVING THIS PURPOSE BASED ON THE12
NUMBER AND VALUE OF CREDITS ISSUED AND NEW RENEWABLE ENERGY13
INVESTMENTS IN ENTERPRISE ZONES.14
SECTION 29. In Colorado Revised Statutes, 39-30-105.1,15
amend (1)(a)(I) and (1)(b); and add (6)(e.5) as follows:16
39-30-105.1. Credit for new enterprise zone business17
employees - definitions.18
(1) (a) (I) (A) For any income tax year commencing on or after19
January 1, 2014, BUT BEFORE JANUARY 1, 2027, any taxpayer who20
operates a business facility in an enterprise zone is allowed a credit21
against the income tax imposed by article 22 of this title in an amount22
equal to one thousand one hundred dollars per income tax year for each23
business facility employee, pursuant to subsection (5) of this section, who24
is working within the zone, prorated according to the number of months25
the employee was employed by the taxpayer during the income tax year.26
An employee whose primary duties consist of operating a commercial27
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motor vehicle with a commercial driver's license shall be deemed to be1
working one hundred percent within the zone if the employee spends no2
more than five percent of his or her THE EMPLOYEE'S total time at any3
business of the employer other than the business within the zone.4
(B) FOR INCOME TAX YEARS COMMENCING ON OR AFTER JANUARY5
1, 2027, ANY TAXPAYER WHO OPERATES A BUSINESS FACILITY IN AN6
ENTERPRISE ZONE IS ALLOWED A CREDIT AGAINST THE INCOME TAX7
IMPOSED BY ARTICLE 22 OF THIS TITLE 39 IN AN AMOUNT EQUAL TO ONE8
THOUSAND ONE HUNDRED DOLLARS PER INCOME TAX YEAR FOR EACH9
QUALIFIED NEW EMPLOYEE, PURSUANT TO SUBSECTIONS (5) AND (6) OF10
THIS SECTION, WHO IS WORKING WITHIN THE ZONE, PRORATED ACCORDING11
TO THE NUMBER OF MONTHS THE EMPLOYEE WAS EMPLOYED BY THE12
TAXPAYER DURING THE INCOME TAX YEAR . AN EMPLOYEE WHOSE13
PRIMARY DUTIES CONSIST OF OPERATING A COMMERCIAL MOTOR VEHICLE14
WITH A COMMERCIAL DRIVER'S LICENSE SHALL BE DEEMED TO BE WORKING15
ONE HUNDRED PERCENT WITHIN THE ZONE IF THE EMPLOYEE SPENDS NO16
MORE THAN FIVE PERCENT OF THE EMPLOYEE 'S TOTAL TIME AT ANY17
BUSINESS OF THE EMPLOYER OTHER THAN THE BUSINESS WITHIN THE ZONE.18
A TAXPAYER MAY ONLY CLAIM THE CREDIT ALLOWED PURSUANT TO THIS19
SUBSECTION (1)(a)(I)(B) IN CONNECTION WITH A QUALIFIED NEW20
EMPLOYEE FOR THE INCOME TAX YEAR IN WHICH THE QUALIFIED NEW21
EMPLOYEE BECOMES FIRST EMPLOYED . A TAXPAYER SHALL NOT CLAIM22
THE CREDIT ALLOWED PURSUANT TO THIS SUBSECTION (1)(a)(I)(B) IN23
CONNECTION WITH AN EMPLOYEE WHO HAS BEEN PREVIOUSLY COUNTED24
AS A QUALIFIED NEW EMPLOYEE IN AN EARLIER INCOME TAX YEAR.25
(b) (I) E XCEPT AS PROVIDED IN SUBSECTION (1)(b)(II) OF THIS26
SECTION, in addition to the credit available under paragraph (a) of this27
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subsection SUBSECTION (1)(a) OF THIS SECTION, for any income tax year1
commencing on or after January 1, 2014, a taxpayer qualified under said2
paragraph (a) SUBSECTION (1)(a) OF THIS SECTION is allowed for the first3
two full income tax years while located in an enterprise zone a credit in4
an amount equal to one thousand dollars for each business facility5
employee who is insured under a health insurance plan or program6
provided through his or her THE EMPLOYEE'S employer. To be eligible for7
the credit, the employer must contribute fifty percent or more of the total8
cost of a health insurance plan or program, and such plan or program9
must be in accordance with the provisions of article 8 of title 10 or part10
1, 2, 3, or 4 of article 16 of title 10, C.R.S., or be a self-insurance program11
and include partial or complete coverage for hospital and physician12
services.13
(II) FOR INCOME TAX YEARS BEGINNING ON OR AFTER JANUARY 1,14
2027, A TAXPAYER THAT HAS FIFTY OR MORE BUSINESS FACILITY15
EMPLOYEES AT ANY TIME DURING AN INCOME TAX YEAR SHALL NOT CLAIM16
THE CREDIT PROVIDED FOR IN THIS SECTION FOR THAT TAX YEAR.17
(6) As used in this section, unless the context otherwise requires:18
(e.5) "QUALIFIED NEW EMPLOYEE" MEANS A BUSINESS FACILITY19
EMPLOYEE WHO BEGINS EMPLOYMENT WITH THE TAXPAYER AT THE20
BUSINESS FACILITY WITHIN THE ENTERPRISE ZONE DURING THE INCOME21
TAX YEAR THAT THE TAXPAYER CLAIMS THE TAX CREDIT AND WHO WAS22
NOT EMPLOYED BY THE TAXPAYER IN ANY CAPACITY IN THE PRECEDING23
INCOME TAX YEAR.24
SECTION 30. In Colorado Revised Statutes, 39-30-105.5,25
amend (1) introductory portion; and add (1)(c) and (1.5) as follows: 26
39-30-105.5. Credit against Colorado income taxes based on27
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expenditures for research and experimental activities - repeal.1
(1) FOR INCOME TAX YEARS BEGINNING BEFORE JANUARY 1, 2027,2
any taxpayer who makes expenditures in research and experimental3
activities, as defined in section 174 of the federal "Internal Revenue Code4
of 1986", as amended, which activities are conducted in an enterprise5
zone for the purpose of carrying out a trade or business, shall be allowed6
a credit against the income tax imposed by article 22 of this title TITLE 397
as follows:8
(c) THIS SUBSECTION (1) IS REPEALED, EFFECTIVE DECEMBER 31,9
2033.10
(1.5) FOR INCOME TAX YEARS BEGINNING ON OR AFTER JANUARY11
1, 2027, ANY TAXPAYER WHO MAKES AT LEAST ONE HUNDRED FIFTY12
THOUSAND DOLLARS IN EXPENDITURES IN RESEARCH AND EXPERIMENTAL13
ACTIVITIES, AS DEFINED IN SECTION 174A OF THE FEDERAL "INTERNAL14
REVENUE CODE OF 1986", AS AMENDED , WHICH ACTIVITIES ARE15
CONDUCTED IN AN ENTERPRISE ZONE FOR THE PURPOSE OF CARRYING OUT16
A TRADE OR BUSINESS, SHALL BE ALLOWED A CREDIT AGAINST THE INCOME17
TAX IMPOSED BY ARTICLE 22 OF THIS TITLE 39 IN AN AMOUNT EQUAL TO18
THREE PERCENT OF THE AMOUNT BY WHICH THE AMOUNT THAT THE19
TAXPAYER EXPENDED FOR RESEARCH AND EXPERIMENTAL ACTIVITIES IN20
THE ENTERPRISE ZONE IN THE INCOME TAX YEAR EXCEEDS THE AVERAGE21
OF THE TAXPAYER 'S TOTAL EXPENDITURES FOR RESEARCH AND22
EXPERIMENTAL ACTIVITIES IN THE IMMEDIATELY PRECEDING TWO INCOME23
TAX YEARS IN THE AREA THAT COMPROMISED THE RELEVANT ENTERPRISE24
ZONE.25
SECTION 31. In Colorado Revised Statutes, 39-30-105.6,26
amend (1) as follows:27
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39-30-105.6. Credit against tax - rehabilitation of vacant1
buildings - repeal.2
(1) (a) (I) For income tax years commencing on or after January3
1, 1989, BUT BEFORE JANUARY 1, 2027, any taxpayer who is the owner or4
tenant of a building which THAT is located in an enterprise zone, which5
is at least twenty years old, and which has been unoccupied for at least6
two years and who makes qualified expenditures for the purpose of7
rehabilitating said building shall be allowed a credit against the income8
tax imposed by article 22 of this title TITLE 39 in an amount equal to9
twenty-five percent of the aggregate qualified expenditures per building10
or fifty thousand dollars per building, whichever is less.11
(II) THIS SUBSECTION (1)(a) IS REPEALED, EFFECTIVE DECEMBER12
31, 2033.13
(b) FOR INCOME TAX YEARS BEGINNING ON OR AFTER JANUARY14
1,2027, ANY TAXPAYER WHO IS THE OWNER OR TENANT OF A BUILDING15
THAT IS LOCATED IN AN ENTERPRISE ZONE , IS AT LEAST TWENTY YEARS16
OLD, AND HAS BEEN UNOCCUPIED FOR ANY ONE HUNDRED THIRTY -FIVE17
CALENDAR DAYS WITHIN THE ONE HUNDRED EIGHTY CALENDAR DAYS18
PRECEDING THE DATE THAT THE TAXPAYER PLACES A REHABILITATION IN19
SERVICE AND WHO MAKES QUALIFIED EXPENDITURES FOR THE PURPOSE OF20
REHABILITATING SAID BUILDING SHALL BE ALLOWED A CREDIT AGAINST21
THE INCOME TAX IMPOSED BY ARTICLE 22 OF THIS TITLE 39 IN AN AMOUNT22
EQUAL TO TWENTY -FIVE PERCENT OF THE AGGREGATE QUALIFIED23
EXPENDITURES PER BUILDING OR TWO HUNDRED THOUSAND DOLLARS PER24
BUILDING, WHICHEVER IS LESS.25
SECTION 32. In Colorado Revised Statutes, 39-31-101, amend26
(1)(a) introductory portion, (2)(d), (2.1), (5)(a), (5)(c), (5)(d), and (5)(e)27
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as follows:1
39-31-101. Real property tax - tax equivalent - assistance -2
heat or fuel expenses assistance - eligibility - applicability - definitions3
- repeal. 4
(1) (a) B EFORE JANUARY 1, 2027, individuals having resided5
within this state for the entire taxable year who are sixty-five years of age6
or older during the taxable year are eligible for a grant to be determined7
with respect to the income taxes imposed by article 22 of this title 39,8
subject to the additional qualification requirements of this section, to aid9
in the payment by such individuals of:10
(2) A grant is the amount of the general property taxes actually11
paid on the residence or the amount of taxes actually paid on a mobile12
home, plus any tax-equivalent payments computed pursuant to subsection13
(4) of this section, with respect to the rent of a trailer space during the14
year for which the grant is claimed, the amount of the specific ownership15
tax actually paid on a trailer coach, or the amount of the tax-equivalent16
payments, computed pursuant to subsection (4) of this section, actually17
made during the year for which such grant is claimed, but in no event may18
it exceed:19
(d) For a grant claimed for the 2023 calendar year, either eight20
hundred seventy-two dollars reduced by ten percent of the claimant's21
income over the phase-out amount or the property tax flat grant amount,22
whichever amount is greater. For a grant claimed for years commencing23
on or after January 1, 2024, BUT BEFORE JANUARY 1, 2027, either the24
maximum grant amount allowed under this subsection (2)(d) for the prior25
year, adjusted for inflation and reduced by ten percent of the claimant's26
income over the phase-out amount, or the property tax flat grant amount,27
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whichever amount is greater.1
(2.1) For a grant claimed for the 2023 calendar year, either two2
hundred forty dollars reduced by ten percent of the claimant's income3
over the phase-out amount or the heat or fuel expenses flat grant amount,4
whichever amount is greater. For a grant claimed for years commencing5
on or after January 1, 2024, BUT BEFORE JANUARY 1, 2027, either the6
maximum grant amount allowed under this subsection (2.1) for the prior7
year, adjusted for inflation and reduced by ten percent of the claimant's8
income over the phase-out amount, or the heat or fuel expenses flat grant9
amount, whichever amount is greater.10
(5) As used in this section:11
(a) "Heat or fuel expenses flat grant amount" means an amount12
equal to ninety-two dollars for the 2023 calendar year, and for each year13
thereafter, UNTIL JANUARY 1, 2027, the amount for the prior year adjusted14
for inflation.15
(c) "Maximum eligible income amount" means:16
(I) For an individual, income that is less than or equal to eighteen17
thousand twenty-six dollars for the 2023 calendar year and for each year18
thereafter, UNTIL JANUARY 1, 2027, the amount for the prior year adjusted19
for inflation; and20
(II) For spouses, income that is less than or equal to twenty-four21
thousand three hundred forty-five dollars for the 2023 calendar year and22
for each year thereafter, UNTIL JANUARY 1, 2027, the amount for the prior23
year adjusted for inflation.24
(d) "Phase-out amount" means:25
(I) In the case of an individual, an amount equal to nine thousand26
six hundred ninety-two dollars fo r the 2023 calendar year and for each27
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year thereafter, UNTIL JANUARY 1, 2027, the amount for the prior year1
adjusted for inflation; and2
(II) In the case of spouses, an amount equal to fifteen thousand six3
hundred sixty-eight dollars for the 2023 calendar year and for each year4
thereafter, UNTIL JANUARY 1, 2027, the amount for the prior year adjusted5
for inflation.6
(e) "Property tax flat grant amount" means an amount equal to two7
hundred eighty-two dollars for the 2023 calendar year, and for each year8
thereafter, UNTIL JANUARY 1, 2027, the amount for the prior year adjusted9
for inflation.10
SECTION 33. In Colorado Revised Statutes, 39-31-102, amend11
(2) and (3) as follows:12
39-31-102. Procedures to obtain grant - department of revenue13
- responsibilities. 14
(2) The executive director shall prescribe the forms to be used for15
the grants authorized by section 39-31-101 and the credit allowed16
pursuant to section 39-31-104.5 and prepare any instructions related to the17
forms. The executive director may create an electronic form to be used in18
addition to the paper form. If a sales tax refund is allowed for any given19
income tax year in accordance with section 39-22-2002, the executive20
director shall include provisions on the forms to allow qualified21
individuals to apply for the refund pursuant to section 39-22-2003 (5)(c).22
To receive a grant, or credit, an individual must claim the grant or credit23
on the executive director's form.24
(3) (a) If two or more individuals, other than spouses, are entitled25
to a grant authorized by section 39-31-101, or a credit allowed pursuant26
to section 39-31-104.5, the grant or credit may be claimed by either or any27
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of the individuals. When two or more individuals claim the grant or credit1
for the same residence, the executive director is authorized to determine2
the proper allocation of the grant. or credit3
(b) No grant or credit received pursuant to this article 31 is treated4
as income for purposes of determining the eligibility of any individual for5
old age pension benefits under article 2 of title 26.6
SECTION 34. Repeal of relocated provisions in this act. In7
Colorado Revised Statutes, repeal 39-31-104.5.8
SECTION 35. In Colorado Revised Statutes, add 39-31-106 as9
follows:10
39-31-106. Repeal of article. 11
THIS ARTICLE 31 IS REPEALED, EFFECTIVE DECEMBER 31, 2027.12
SECTION 36. In Colorado Revised Statutes, 39-22-544, amend13
(4)(c) as follows:14
39-22-544. Credit against tax - qualifying seniors - creation -15
legislative declaration - definitions - repeal. 16
(4) (c) (I) For the income tax year commencing on January 1,17
2022, notwithstanding subsections (4)(a) and (4)(b) of this section, a18
taxpayer who also qualifies for a grant under article 31 of this title 3919
during calendar year 2022 is eligible to receive the full credit without an20
income-based reduction that otherwise applies for the taxpayer under21
subsection (4)(a) or (4)(b) of this section.22
(II) THIS SUBSECTION (4)(c) IS REPEALED, EFFECTIVE DECEMBER23
31, 2027.24
SECTION 37. In Colorado Revised Statutes, 39-22-2003, amend25
(5)(c)(I); and add (5)(c)(III) as follows:26
39-22-2003. State sales tax refund - offset against state income27
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tax - qualified individuals - definitions - repeal. 1
(5) (c) (I) Notwithstanding any provision of subsection (5)(b) of2
this section to the contrary, BEFORE JANUARY 1, 2027, a qualified3
individual as defined in subsection (1)(a)(II) or (1)(a)(IV) of this section4
who claims a property tax or heat or fuel assistance grant pursuant to5
section 39-31-101 may claim a refund authorized by this section on the6
assistance grant application form described in section 39-31-102 (2).7
Claiming a refund on such assistance grant application form is in lieu of8
claiming the refund on an income tax return pursuant to subsection (5)(b)9
of this section. Any refund claimed pursuant to this subsection (5)(c) must10
be claimed on or before October 15 of the calendar year following the tax11
year for which the refund is being claimed.12
(III) THIS SUBSECTION (5)(c) IS REPEALED, EFFECTIVE DECEMBER13
31, 2027.14
SECTION 38. In Colorado Revised Statutes, 39-21-108, amend15
(5) as follows:16
39-21-108. Refunds. 17
(5) (a) On and after October 1, 2002, any warrant representing a18
refund of income tax imposed by article 22 of this title 39 or, FOR INCOME19
TAX YEARS COMMENCING BEFORE JANUARY 1, 2027, a grant for property20
taxes, rent, or heat or fuel expenses assistance allowed by article 31 of21
this title 39 that is not presented for payment within six months from its22
date of issuance shall be IS void. On and after October 1, 2002, upon the23
cancellation of a warrant in accordance with the standard operating24
procedures of the department or the state controller, the department shall25
forward to the state treasurer the name of the taxpayer as it appears on the26
warrant, the taxpayer identification number, the taxpayer's last-known27
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address, the amount of the canceled warrant, and an amount of money1
equal to the amount specified in the warrant so that the state treasurer may2
make the refund pursuant to the "Revised Uniform Unclaimed Property3
Act", article 13 of title 38. 4
(b) The department may reclaim from the unclaimed property fund5
and credit to the appropriate state revenue fund any amount forwarded by6
the department to the state treasurer pursuant to paragraph (a) of this7
subsection (5) SUBSECTION (5)(a) OF THIS SECTION that was based on a8
warrant representing an erroneous refund. or grant If the state treasurer9
issued an erroneous refund or grant to the person named on the warrant,10
the treasurer shall provide proof of that payment to the department and11
the department may assess that amount pursuant to section 39-21-103 (1). 12
SECTION 39. In Colorado Revised Statutes, 38-13-220, amend13
(1) as follows:14
38-13-220. Tax refunds. 15
(1) On and after October 1, 2002, any amount due and payable as16
a refund of Colorado income tax or, FOR INCOME TAX YEARS BEGINNING17
BEFORE JANUARY 1, 2027, a grant for property taxes, rent, or heat or fuel18
expenses assistance represented by a warrant that has not been presented19
for payment within six months after the date of issuance of the warrant20
and that has been forwarded by the department of revenue to the21
administrator pursuant to section 39-21-108 (5) is presumed abandoned.22
SECTION 40. Safety clause. The general assembly finds,23
determines, and declares that this act is necessary for the immediate24
preservation of the public peace, health, or safety or for appropriations for25
the support and maintenance of the departments of the state and state26
institutions.27
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