Capital letters indicate new material to be added to existing statute.
Dashes through the words indicate deletions from existing statute.

Capital letters indicate new material to be added to existing statute.

Dashes through the words indicate deletions from existing statute.

First Regular Session

Sixty-first General Assembly

LLS NO. 97­0201.01 MKD HOUSE BILL 97­1212

STATE OF COLORADO

BY REPRESENTATIVE Morrison;

also SENATOR Reeves.

FINANCE

A BILL FOR AN ACT

CONCERNING A CHANGE IN STATE INCOME TAX POLICY TO ASSIST INDIVIDUALS WITH DEPENDENT CHILDREN.

Bill Summary

(Note: This summary applies to this bill as introduced and does not necessarily reflect any amendments which may be subsequently adopted.)

Beginning with the 1997 income tax year, allows a Colorado taxpayer whose federal adjusted gross income is less than a specified amount to claim a credit against state income taxes for the taxpayer's dependent children 3 years of age and under. Specifies the amount of the credit, depending on the taxpayer's federal adjusted gross income. Permits a taxpayer to carry forward for up to 5 years any unused credit. Allows the credit to a part­time resident in an apportioned amount.

Be it enacted by the General Assembly of the State of Colorado:

SECTION 1.  Part 1 of article 22 of title 39, Colorado Revised Statutes, 1994 Repl. Vol., as amended, is amended BY THE ADDITION OF A NEW SECTION to read:

39­22­120.  Tax credit for dependent children three years of age and under. (1) (a)  FOR INCOME TAX YEARS BEGINNING ON AND AFTER JANUARY 1, 1997, A RESIDENT INDIVIDUAL WHO FOR FEDERAL INCOME TAX PURPOSES CLAIMS ONE OR MORE DEPENDENTS WHO HAVE NOT ATTAINED THE AGE OF FOUR YEARS BY DECEMBER 31 OF THE TAX YEAR SHALL BE ALLOWED A DEPENDENT CARE CREDIT AGAINST THE INCOME TAXES DUE ON THE INDIVIDUAL'S INCOME UNDER THIS ARTICLE CALCULATED AS FOLLOWS:

(I)  IF THE RESIDENT INDIVIDUAL'S FEDERAL ADJUSTED GROSS INCOME IS TWENTY­FIVE THOUSAND DOLLARS OR LESS, THE CREDIT SHALL BE FIVE HUNDRED DOLLARS PER DEPENDENT CHILD WHO HAS NOT ATTAINED THE AGE OF FOUR YEARS BY DECEMBER 31 OF THE TAX YEAR.

(II)  IF THE RESIDENT INDIVIDUAL'S FEDERAL ADJUSTED GROSS INCOME IS OVER TWENTY­FIVE THOUSAND DOLLARS BUT NOT OVER THIRTY­FIVE THOUSAND DOLLARS, THE CREDIT SHALL BE THREE HUNDRED DOLLARS PER DEPENDENT CHILD WHO HAS NOT ATTAINED THE AGE OF FOUR YEARS BY DECEMBER 31 OF THE TAX YEAR.

(III)  IF THE RESIDENT INDIVIDUAL'S FEDERAL ADJUSTED GROSS INCOME IS OVER THIRTY­FIVE THOUSAND DOLLARS BUT NOT OVER FORTY­FIVE THOUSAND DOLLARS, THE CREDIT SHALL BE TWO HUNDRED DOLLARS PER DEPENDENT CHILD.

(b)  IF THE RESIDENT INDIVIDUAL'S FEDERAL ADJUSTED GROSS INCOME IS OVER FORTY­FIVE THOUSAND DOLLARS, THE RESIDENT INDIVIDUAL SHALL NOT BE ALLOWED A CREDIT UNDER THIS SUBSECTION (1).

(2)  IF THE CREDIT ALLOWED UNDER SUBSECTION (1) OF THIS SECTION EXCEEDS THE INCOME TAXES DUE ON THE RESIDENT INDIVIDUAL'S INCOME, THE AMOUNT OF THE CREDIT NOT USED AS AN OFFSET AGAINST INCOME TAXES MAY BE CARRIED FORWARD AS A TAX CREDIT AGAINST THE RESIDENT INDIVIDUAL'S SUBSEQUENT YEARS' INCOME TAX LIABILITY FOR A PERIOD NOT EXCEEDING FIVE YEARS AND SHALL BE APPLIED FIRST TO THE EARLIEST YEARS POSSIBLE.

(3)  IN THE CASE OF A RESIDENT FOR PART OF THE TAX YEAR, THE CREDIT ALLOWED BY THIS SECTION SHALL BE APPORTIONED PURSUANT TO THE PROVISIONS OF SECTION 39­22­110 (1).

SECTION 2.  Safety clause.  The general assembly hereby finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, and safety.