COLORADO TAX CHANGES EFFECTIVE FOR

THE TAX YEAR

2009-2010

Colorado TABOR Deductions or Tax Credits available for 2009 and 2010

OVERVIEW

Colorado's Taxpayer's Bill of Rights (TABOR) constitutionally limits the state government’s annual revenue growth.  Any revenue growth that exceeds the permitted revenue growth generates a "TABOR Surplus" that the state must refund to the taxpayers.  This refund process consists of several income tax credits and deductions, the existence and amount of each of which is based on the amount of the TABOR surplus.  All of the Colorado tax credits, deductions and refunds contingent on the TABOR surplus were last available to Colorado taxpayers for their 2001 tax returns.

Since 2001, there has been no "TABOR Surplus", therefore for 2009 and 2010, as it was for 2002 through 2008, ALL of the credits and deductions that are contingent on the "TABOR Surplus" for are not available, except for the child care credit and some credits relating to enterprise zones.

IN ADDITION, in November 2005, the Colorado voters passed Referendum C.  By its passage, there will NOT be any budget surplus for the years 2006 through 2010.  As a result, none of the TABOR triggered credits or deductions will be available until 2011 at the earliest.

DEDUCTIONS AND CREDITS NOT AVAILABLE FOR 2005 THROUGH 2010.

The following income tax deductions and credits will not be permitted for 2009 individual income tax returns to be filed in 2010, and will not be available until the year 2011 at the earliest:

Earned Income Tax Credit.

Child Tax Credit.

Charitable Credits for Matching Contributions to Individual Development Accounts.

Interest, Dividend and Capital Gains Subtraction.

Expanded Colorado Capital Gains Subtraction for Colorado Property (Note:  The subtraction is still available but ONLY for Colorado assets acquired AFTER May 9, 1994, and owned continuously for 5 years prior to sale. The deduction has been further limited starting in 2010 to a maximum exclusion of $100,000 per year)

Tax Credit for Rural Health Care Professionals.

Foster Care Tax Credit.

Credits for Contributions to Colorado's High Technology Scholarship Program.

Charitable contribution deduction for contributions in excess of $500 for taxpayers who do not itemize.

Credit for Health Benefit Plans for Taxpayers Not Covered By An Employer Plan.

Income Tax Credit for Investments in Agricultural Cooperatives.

The following income tax deductions and credits are not available to corporations, fiduciaries and partnerships for 2009 returns:

	Expanded Colorado Capital Gains Subtraction for Colorado Property  (See above for exception).
	Interest, Dividend and Capital Gains Deduction (Fiduciaries Only).
	Income Tax Credit for Investments in Agricultural Cooperatives.
	Credits for Contributions to Colorado's High Technology Scholarship Program.

COLORADO “HALL OF SHAME"

The Colorado Department of Revenue is required to disclose for public inspection a list of all taxpayers who have owed more than $20,000 in delinquent taxes to the State of Colorado for at least 6 months.  The list is shown on the Colorado Department of Revenue website under delinquent taxpayers and it shows the taxpayer's name and address and the amounts owed each year.