HB 23-1091

House Bill 23-1091, which has been signed into law, extends a tax credit for individuals who contribute money to support child care in Colorado. This credit allows taxpayers to claim 50% of their contribution as an income tax credit and will now be available until January 1, 2025. The bill also requires state agencies to develop ways to measure the effectiveness of this tax credit and suggest improvements for future years. It was approved by Governor Polis on May 23, 2023, and became effective on August 7, 2023. This means that taxpayers can now claim the credit for contributions made after August 7, 2023.

Official Summary

For income tax years commencing prior to January 1, 2025, a taxpayer who makes a monetary contribution to promote child care in the state is allowed an income tax credit that is equal to 50% of the total value of the contribution. The act extends the credit for 3 years. The act requires the department of revenue to consult with the early childhood leadership commission, the public-private collaboration unit in the department of personnel, and the department of early childhood to develop recommendations for measuring the effectiveness of the tax credit and recommendations for improving and expanding the tax credit. The act also requires the state auditor to prepare the tax expenditure evaluation report for the credit that the law periodically requires in the income tax year commencing January 1, 2026. For the 2023-24 state fiscal year, $78,254 is appropriated from the general fund to the department of revenue to implement the act and $10,881 of the appropriation is reappropriated to the department of personnel to provide document management services for the department of revenue. APPROVED by Governor May 23, 2023 EFFECTIVE August 7, 2023 NOTE: This act was passed without a safety clause and takes effect 90 days after sine die. (Note: This summary applies to this bill as enacted.)

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