BY SENATORS Phillips, Bishop, Matsunaka, Rupert, Linkhart, Martinez, Pascoe, Reeves, Rizzuto, Tanner, and Thiebaut;
also REPRESENTATIVES Tool, Bacon, Chavez, Hagedorn,
Mace, Nichol, Reeser, Romero, Saliman, Udall, Veiga, Williams,
and Zimmerman.
CONCERNING A CHANGE IN STATE INCOME TAX POLICY PERTAINING
TO EXPENSES RELATED TO CHILD CARE.
Be it enacted by the General Assembly of the State
of Colorado:
SECTION 1. 3922119 (2),
(3), and (4), Colorado Revised Statutes, are amended, and the
said 3922119 is further amended BY THE ADDITION OF
A NEW SUBSECTION, to read:
3922119. Expenses related
to child care credits against state tax.
(1.5) (a) NOTWITHSTANDING THE PROVISIONS OF SUBSECTION
(1) OF THIS SECTION, IF, FOR ANY INCOME TAX YEAR BEGINNING ON
OR AFTER JANUARY 1, 1998, THE AMOUNT OF STATE REVENUES FOR THE
STATE FISCAL YEAR ENDING IN THE IMMEDIATELY PRECEDING INCOME TAX
YEAR EXCEEDED THE LIMITATION ON STATE FISCAL YEAR SPENDING IMPOSED
BY SECTION 20 (7) (a) OF ARTICLE X OF THE STATE CONSTITUTION AND
THE VOTERS STATEWIDE DID NOT AUTHORIZE THE STATE TO RETAIN AND
SPEND ALL OF THE EXCESS STATE REVENUES FOR THAT STATE FISCAL YEAR,
THEN A RESIDENT INDIVIDUAL SHALL NOT BE ALLOWED A CREDIT FOR CHILD
CARE EXPENSES UNDER SUBSECTION (1) OF THIS SECTION BUT SHALL BE
ALLOWED CREDITS FOR EXPENSES RELATED TO CHILD CARE AS FOLLOWS:
(I) A RESIDENT INDIVIDUAL WHO CLAIMS A
CREDIT FOR CHILD CARE EXPENSES ON THE INDIVIDUAL'S FEDERAL TAX
RETURN SHALL BE ALLOWED A CHILD CARE EXPENSES CREDIT AGAINST THE
INCOME TAXES DUE ON THE INDIVIDUAL'S INCOME UNDER THIS ARTICLE
IN AN AMOUNT EQUAL TO FIFTY PERCENT OF THE CREDIT FOR CHILD CARE
EXPENSES CLAIMED ON THE INDIVIDUAL'S FEDERAL TAX RETURN; EXCEPT
THAT SUCH CREDIT SHALL BE REDUCED BY THE AMOUNT OF ANY CREDIT
CLAIMED UNDER SUBPARAGRAPH (II) OF THIS PARAGRAPH (a).
(II) A RESIDENT INDIVIDUAL WHO CLAIMS
A CHILD TAX CREDIT FOR ONE OR MORE QUALIFYING CHILDREN PURSUANT
TO SECTION 24 OF THE INTERNAL REVENUE CODE ON THE INDIVIDUAL'S
FEDERAL TAX RETURN SHALL BE ALLOWED A CHILD TAX CREDIT AGAINST
THE INCOME TAXES DUE ON THE INDIVIDUAL'S INCOME UNDER THIS ARTICLE
IN THE AMOUNT OF TWO HUNDRED DOLLARS FOR EACH QUALIFYING CHILD
WHO IS FIVE YEARS OF AGE OR UNDER AT THE END OF THE TAXABLE YEAR
FOR WHICH THE CREDIT IS CLAIMED.
(b) A RESIDENT INDIVIDUAL WHOSE FEDERAL
ADJUSTED GROSS INCOME IS SIXTY THOUSAND ONE DOLLARS OR MORE SHALL
NOT BE ALLOWED A CREDIT UNDER THIS SUBSECTION (1.5).
(c) NOTWITHSTANDING ANY OTHER PROVISIONS
OF THIS SUBSECTION (1.5), IF, FOR ANY INCOME TAX YEAR BEGINNING
ON OR AFTER JANUARY 1, 1998, THE AMOUNT OF STATE REVENUES FOR
THE STATE FISCAL YEAR ENDING IN THE IMMEDIATELY PRECEDING INCOME
TAX YEAR EXCEEDED THE LIMITATION ON STATE FISCAL YEAR SPENDING
IMPOSED BY SECTION 20 (7) (a) OF ARTICLE X OF THE STATE CONSTITUTION
AND THE VOTERS STATEWIDE DID NOT AUTHORIZE THE STATE TO RETAIN
AND SPEND ALL OF THE EXCESS STATE REVENUES FOR THAT STATE FISCAL
YEAR BUT THE TOTAL AMOUNT REQUIRED TO BE REFUNDED PURSUANT TO
SECTION 20 (7) (d) OF ARTICLE X OF THE STATE CONSTITUTION
IS LESS THAN THE TOTAL AMOUNT OF THE CREDITS THAT WOULD BE ALLOWED
UNDER THIS SUBSECTION (1.5), THEN A RESIDENT INDIVIDUAL SHALL
NOT BE ALLOWED ANY CREDIT UNDER THIS SUBSECTION (1.5) BUT SHALL
BE ALLOWED A CREDIT UNDER SUBSECTION (1) OF THIS SECTION.
(2) If the credit
CREDITS allowed under subsection
SUBSECTIONS (1) AND (1.5) of this section exceeds
EXCEED the income taxes due on the resident individual's income,
the amount of the credit
CREDITS not used as an
TO offset against
income taxes may
SHALL NOT be carried forward as a
tax credit
CREDITS 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
REFUNDED TO THE INDIVIDUAL.
(3) The child care expenses credit
CREDITS allowed under subsection
SUBSECTIONS (1) AND (1.5) of this section shall not be allowed
to a resident individual who is receiving child care assistance
from the state department of human services except to the extent
of the taxpayer's unreimbursed outofpocket expenses
that result in a federal credit for child care expense.
(4) In the case of a resident for part
of a tax year, the credit
CREDITS allowed by this section shall be apportioned in the ratio
determined under section 3922110 (1).
SECTION 2. No
appropriation. The general assembly has determined
that this act can be implemented within existing appropriations,
and therefore no separate appropriation of state moneys is necessary
to carry out the purposes of this act.
SECTION 3. 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.
____________________________ ____________________________
Tom Norton Charles E. Berry
PRESIDENT OF SPEAKER OF THE HOUSE
THE SENATE OF REPRESENTATIVES
____________________________ ____________________________
Patricia K. Dicks Judith M. Rodrigue
ASSISTANT SECRETARY OF CHIEF CLERK OF THE HOUSE
THE SENATE OF REPRESENTATIVES
APPROVED________________________________________
_________________________________________
Roy Romer
GOVERNOR OF THE STATE
OF COLORADO