Budget & Taxes

The act extends the availability of the conservation easement tax credit from income tax year 2031 through income tax year 2036. The act also prohibits the division of conservation from issuing any additional credit certificates or amending previously issued credit certificates as a result of the additional authority granted by the act for a donation made prior to the effective date of the act.(Note: This summary applies to this bill as enacted.)

The 2025 general appropriations act is amended to balance and make adjustments to the total amount appropriated to the department of revenue. The general fund portion of the appropriation is decreased and the cash funds and reappropriated funds portions are increased.(Note: This summary applies to this bill as enacted.)

Under current law, only individuals of certain ages may qualify for the federal or state earned income tax credit. The federal "American Rescue Plan Act of 2021" temporarily lowered the minimum age requirement and removed the maximum age requirement for the federal earned income tax credit. In 2021, the lowered minimum age requirement was adopted for the state earned income tax credit (credit) indefinitely. For tax years commencing on or after January 1, 2028, the bill adopts the removal of the maximum age requirement for the credit indefinitely. An individual who claims the credit as a result of the bill may claim the credit in an amount determined in the same manner as an individual who claims the credit as a result of the prior adoption of the lowered minimum age requirement.(Note: This summary applies to this bill as introduced.)

The act creates and allows taxpayers to claim a refundable tax credit, in addition to the child tax credit and the family affordability tax credit, in an amount determined by the amount and age of the taxpayer's children and the taxpayer's income. The total amount of the new tax credit is adjusted annually based on legislative council staff projections, such that the total amount of the new tax credit claimed in an income tax year is projected to be the same as the amount of revenue raised by the repeal of the downloadable software sales and use tax exemption elsewhere in the act.     Beginning January 1, 2027, the act repeals the downloaded software sales and use tax exemption so that all software that is available for repeated sale and license qualifies as tangible property and thus is subject to sales and use tax. The act exempts from sales and use tax downloaded software governed by a negotiable license agreement or developed for use by a particular user.     For each July, August, November, and December in 2027 and 2028, the act allows a qualifying retailer in the food or drink industry to deduct from state net taxable sales the lesser of state net taxable sales or $14,000.     Currently, 15% of the net revenue collected as sales and use tax is credited to the general fund, less 1.655% (allocation percentage), which is credited to the housing development grant fund. Beginning January 1, 2027, and until December 31, 2028, the act reduces the allocation percentage to 1.629%. Beginning January 1, 2029, the allocation percentage is 1.625%.     Beginning July 1, 2026, the act creates a sales and use tax exemption for a retailer selling food or drink (retailer) whose sales of prepared food exceed 25% of the retailer's sales revenue equal to 100% of the price the retailer paid for gas and electricity. A retailer whose sales of prepared food are 25% or less of the retailer's sales revenue is allowed a credit against the sales taxes otherwise due equal to 0.5% of the retailer's prepared food sales revenue.     The repeal of the downloadable software sales and use tax exemption applies to the sale, storage, use, and consumption of tangible personal property on or after January 1, 2027.     Provisions of the act are contingent upon House Bill No. 26-1221 and House Bill No. 26-1222 not becoming law.     For the 2026-27 state fiscal year, the act appropriates $48,326 from the general fund to the department of revenue for tax administration system support and personal services.(Note: This summary applies to this bill as enacted.)

Beginning July 1, 2026, act requires the county treasurer to provide notice of delinquent property taxes on a mobile home written in English and Spanish, and to include a statement explaining how and where a mobile home owner may obtain language translation or interpretation services. The county treasurer is required to provide the multilingual notice by mail and by personal service to the mobile home owner at the mobile home.     The act modifies the process for collection of delinquent property taxes on a mobile home by allowing a county treasurer, at their discretion, to sell a tax lien on a mobile home, strike off a tax lien to the county, or determine the taxes to be uncollectible and recommend cancellation to the board of county commissioners. A tax lien must be sold in accordance with the provisions for tax lien sales on real property. The act extends the redemption period for mobile home owners whose property is subject to a tax lien to any time within 3 years from the date of the tax lien sale, or at any time before the execution of a certificate of ownership to the mobile home. Like a real property owner, an individual who both owns a mobile home and is a person with a legal disability at the time a certificate of ownership to the mobile home is issued is also allowed an extended redemption period of up to 9 years from the issuance of a certificate of ownership to their mobile home. If the mobile home owner has not exercised the right of redemption at least 3 years from the date of the tax lien sale, the purchaser or lawful holder of the certificate of purchase may apply for public auction of a certificate of option for treasurer's certificate of ownership to the mobile home, using the same procedures used for issuance of a treasurer's deed to real property. Any surplus resulting from the public auction that is deemed overbid proceeds must be disbursed to the persons entitled to receive them by law.     The act specifies that if a mobile home that is subject to a tax lien or stricken off to the county is located on real property that is not owned by the mobile home owner, then the underlying landowner has a right of first refusal to pay the delinquent taxes owed on the mobile home and all other fees, costs, and expenses incurred by the county treasurer in connection with the tax lien sale process and obtain a certificate of purchase for a tax lien on the mobile home; except that an owner of a mobile home park does not have a right of first refusal unless the owner is an association of mobile home owners. If an underlying landowner exercises this right, no tax lien will be sold or stricken off to the county.     When a tax lien is stricken off to the county under certain circumstances, the act allows the most recent mobile home owner to redeem the mobile home after 1 year but no later than 3 years from the date of strike off by paying the amount of delinquent taxes plus interest, fees, and costs. If a mobile home is not redeemed, and after notice to the last-known owner and any lienholder of record, the treasurer or county assessor may declare the mobile home abandoned, remove the mobile home from the county tax roll, and authorize the removal and disposal of the mobile home; except that, if an occupant of a mobile home establishes proof of ownership, the most recent mobile home owner has only a 1 year redemption period, after which the treasurer may issue the occupant a certificate of ownership for the mobile home.(Note: This summary applies to this bill as enacted.)

The 2025 general appropriations act is amended to balance and make adjustments to the total amount appropriated for capital construction projects. The cash funds portion of the appropriation is increased.     The 2024 general appropriations act is amended to balance and make adjustments to the total amount appropriated for capital construction projects. The cash funds portion of the appropriation is increased.(Note: This summary applies to this bill as enacted.)

Colorado law exempts the owner of a motor vehicle who is a member of the United States armed forces (member) from motor vehicle registration fees and sets the specific ownership tax at $1 while the member is serving outside the United States. This applies to personal motor vehicles and intrastate trucks, truck tractors, trailers, and semitrailers used to transport property. To qualify, the member must show the military order or evidence acceptable to the department of revenue (department) demonstrating that the member served outside the United States. The act repeals a requirement that the member sign an affidavit to qualify for the $1 specific ownership fee or to be exempt from the motor vehicle fee.     Colorado law exempts members from paying late fees for failing to renew a registration for a vehicle if the member was serving outside the state when the registration period expired. The act sets the requirement to qualify for a late fee exception by requiring the member to show the military order or evidence acceptable to the department demonstrating that the member served outside of the state.     The department will notify the member that the vehicle or motor vehicle must not be driven during deployment.(Note: This summary applies to this bill as enacted.)

A retail delivery is a retail sale of tangible personal property that is subject to state sales tax by a retailer for delivery by a motor vehicle to the purchaser at any location in the state. As authorized by current law, retail delivery fees are imposed on each retail delivery by the:State;Community access enterprise;Clean fleet enterprise;Statewide bridge and tunnel enterprise;Clean transit enterprise; andNonattainment area air pollution mitigation enterprise.Effective 90 days after the final adjournment of the general assembly in 2026, the bill eliminates the retail delivery fees.(Note: This summary applies to this bill as introduced.)

The 2025 general appropriations act is amended to balance and make adjustments to the total amount appropriated to the department of local affairs. The general fund, cash funds, reappropriated funds, and federal funds portions of the appropriation are decreased.(Note: This summary applies to this bill as enacted.)

The 2025 general appropriations act is amended to balance and make adjustments to the total amount appropriated to the department of transportation.(Note: This summary applies to this bill as enacted.)