HB 25-1139

House Bill 25-1139, which has been signed into law, provides a refundable income tax credit for certain veterans in Colorado. The bill allows honorably discharged veterans with at least a 10% service-connected disability who own and live in a home in the state to claim a tax credit based on their property taxes paid. To qualify, veterans need to apply through their local county assessor's office and provide proof of their disability rating from the U.S. Department of Veterans Affairs. The law also extends this benefit to surviving spouses or legal dependents after the veteran’s death until certain conditions are met. This means that eligible veterans will start seeing tax relief on their property taxes beginning in 2026.

Official Summary

For income tax years commencing on or after January 1, 2026, the bill allows a veteran who is honorably discharged, possesses a service-connected disability rating of at least 10%, and owns and occupies a primary residence in the state (eligible veteran) to claim a refundable income tax credit (tax credit) in an amount equal to a percentage, based on the eligible veteran's service-connected disability rating, of the amount of property tax that the eligible veteran paid on their primary residence during the income tax year. To claim a tax credit, a taxpayer must apply to the county assessor for the county in which the taxpayer's primary residence is located and submit a decision letter from the U.S. department of veterans affairs that sets forth their service-connected disability rating. The county assessor is required to determine whether the taxpayer is an eligible veteran and if so, the amount of the income tax credit the eligible veteran may claim, based on the property tax paid by the eligible veteran and the eligible veteran's service-connected disability rating. The county assessor is required to issue a tax credit certificate to an eligible veteran in an amount equal to the amount of the tax credit that may be claimed. Upon the death of an eligible veteran, the eligible veteran's surviving spouse or legal dependents are eligible to claim the tax credit until specified events have occurred. (Note: This summary applies to this bill as introduced.)

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