SB 25-6

Senate Bill 25-6 in Colorado creates a tax credit for individuals who contribute to health savings accounts (HSAs) that are paired with high-deductible health plans. The credit is worth up to $500 for single filers, $1,000 for joint filers, and $1,500 for family plans, which is 25% of the contribution amount. This means taxpayers can reduce their state income tax by this percentage based on how much they put into their HSA. The bill has been signed into law, so Colorado residents who qualify can now claim these credits when filing their taxes.

Official Summary

The bill creates an income tax credit for a resident individual's contributions to a health savings account that supports a high deductible health plan, as defined pursuant to federal law (credit). The credit is an amount equal to 25% of the amount of the contribution, limited to:$500 for a single filer;$1,000 for joint filers; and$1,500 for contributions to a family health plan.If the credit exceeds the income taxes due on the resident individual's income, the amount of the credit not used to offset income taxes is not carried forward as tax credits against the resident individual's subsequent years' income tax liability and is not refunded to the individual. The executive director of the department of revenue is required to adopt rules implementing the credit.(Note: This summary applies to this bill as introduced.)

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