First Regular Session
Sixty-second General Assembly
LLS NO. 99-0395.01 Jason Gelender SENATE BILL 99-055
STATE OF COLORADO
BY SENATOR Linkhart
EDUCATION
APPROPRIATIONS
A BILL FOR AN ACT
101 CONCERNING A CREDIT AGAINST STATE INCOME TAX FOR DONATIONS TO
102 SCHOOLS IN THE STATE.
Bill Summary
(Note: This summary applies to this bill as introduced and does
not necessarily reflect any amendments that may be subsequently
adopted.)
Allows to any taxpayer who makes a monetary or in-kind
contribution to a school in the state an income tax credit in an amount
equal to 25% of the total value of a cash contribution and 12.5% of the
total value of an in-kind contribution. Defines "monetary or in-kind
contribution to a school in the state" to include contributions that are
made for various educational purposes to both public and private
preschools, elementary schools, and secondary schools.
Disallows the credit for contributions made to a school in which
the taxpayer or a relative of the taxpayer has a financial interest or that
are not made for the purpose of promoting education in the state.
Requires any school that receives a contribution to provide a verification
form to the taxpayer making the contribution and include in such a form
a statement that the school will use the contribution for certain specified
purposes.
Limits the total amount of the credit that can be claimed. Allows
any credit in excess of a taxpayer's income tax liability to be carried
forward for up to 5 years, but states that any excess credit remaining after
5 years is not refundable to the taxpayer.
1 Be it enacted by the General Assembly of the State of Colorado:
2 SECTION 1. Part 5 of article 22 of title 39, Colorado Revised
[ ] denotes HOUSE amendment. { } denotes SENATE amendment.
Capital letters indicate new material to be added to existing statute.
Dashes through the words indicate material to be deleted from existing statute.
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1 Statutes, is amended BY THE ADDITION OF A NEW SECTION to
2 read:
3 39-22-522. Credit for donations to schools. (1) FOR INCOME
4 TAX YEARS COMMENCING ON OR AFTER JANUARY 1, 1999, AND SUBJECT TO
5 THE LIMITATIONS SET FORTH IN SUBSECTIONS (3), (5), AND (6) OF THIS
6 SECTION, ANY TAXPAYER WHO MAKES A MONETARY OR IN-KIND
7 CONTRIBUTION TO A SCHOOL IN THE STATE SHALL BE ALLOWED A CREDIT
8 AGAINST THE INCOME TAX IMPOSED BY THIS ARTICLE IN AN AMOUNT EQUAL
9 TO TWENTY-FIVE PERCENT OF THE TOTAL VALUE OF ANY MONETARY
10 CONTRIBUTION AND TWELVE AND ONE-HALF PERCENT OF THE TOTAL
11 VALUE OF ANY IN-KIND CONTRIBUTION.
12 (2) FOR PURPOSES OF THIS SECTION, "MONETARY OR IN-KIND
13 CONTRIBUTION TO A SCHOOL IN THE STATE" MEANS A DONATION OF
14 MONEY, REAL ESTATE, OR TANGIBLE PERSONAL PROPERTY TO ANY PUBLIC
15 OR PRIVATE PRESCHOOL, ELEMENTARY SCHOOL, OR SECONDARY SCHOOL
16 IN THE STATE FOR ANY OF THE FOLLOWING PURPOSES:
17 (a) BUILDING OR MAINTAINING A SCHOOL BUILDING OR FACILITY;
18 (b) ESTABLISHING OR OPERATING AN EDUCATIONAL PROGRAM;
19 (c) ESTABLISHING OR CONTRIBUTING TO A GRANT, LOAN, OR
20 SCHOLARSHIP PROGRAM FOR STUDENTS WHO REQUIRE FINANCIAL
21 ASSISTANCE OR DEMONSTRATE HIGH ACADEMIC ACHIEVEMENT;
22 (d) TRAINING TEACHERS; AND
23 (e) PROVIDING OR PURCHASING EQUIPMENT, INCLUDING BUT NOT
24 LIMITED TO COMPUTERS, AUDIO-VISUAL DEVICES, AND TEXTBOOKS, USED
25 TO EDUCATE STUDENTS.
26 (3) IN NO EVENT SHALL A CREDIT BE ALLOWED PURSUANT TO THIS
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1 SECTION FOR A CONTRIBUTION THAT IS NOT DIRECTLY RELATED TO THE
2 PROMOTION OF EDUCATION IN THE STATE OR FOR A CONTRIBUTION THAT
3 IS MADE TO A SCHOOL IN WHICH THE TAXPAYER OR ANY RELATIVE OF THE
4 TAXPAYER HAS A FINANCIAL INTEREST.
5 (4) ANY SCHOOL SHALL PROVIDE, UPON RECEIVING A
6 CONTRIBUTION, A VERIFICATION FORM TO THE TAXPAYER MAKING THE
7 CONTRIBUTION. THE VERIFICATION FORM SHALL SPECIFY THE AMOUNT OF
8 ANY MONETARY CONTRIBUTION AND THE VALUE AND NATURE OF ANY
9 IN-KIND CONTRIBUTION, THE NAME OF THE TAXPAYER MAKING THE
10 CONTRIBUTION, AND THE NAME AND ADDRESS OF THE SCHOOL RECEIVING
11 THE CONTRIBUTION. THE VERIFICATION FORM SHALL ALSO INDICATE THAT
12 THE SCHOOL WILL DIRECTLY INVEST THE CONTRIBUTION FOR ONE OR MORE
13 OF THE PURPOSES SPECIFIED IN SUBSECTION (2) OF THIS SECTION. THE
14 VERIFICATION FORM SHALL BE SIGNED AND DATED BY A PERSON
15 AUTHORIZED BY THE SCHOOL. THE TAXPAYER SHALL FILE THE
16 VERIFICATION FORM WITH THE DEPARTMENT OF REVENUE FOR THE
17 PURPOSE OF CLAIMING THE CREDIT ALLOWED BY SUBSECTION (1) OF THIS
18 SECTION.
19 (5) THE CREDIT ALLOWED BY THIS SECTION SHALL NOT EXCEED
20 ONE HUNDRED FIFTY THOUSAND DOLLARS, OF WHICH NO MORE THAN ONE
21 HUNDRED THOUSAND DOLLARS MAY BE ALLOWED FOR MONETARY
22 CONTRIBUTIONS, AND NO MORE THAN FIFTY THOUSAND DOLLARS MAY BE
23 ALLOWED FOR IN-KIND CONTRIBUTIONS, OR THE TAXPAYER'S ACTUAL
24 INCOME TAX LIABILITY FOR THE TAX YEAR FOR WHICH THE CREDIT IS
25 CLAIMED, WHICHEVER IS LESS.
26 (6) IF THE AMOUNT OF THE CREDIT ALLOWED PURSUANT TO THE
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1 PROVISIONS OF THIS SECTION EXCEEDS THE AMOUNT OF INCOME TAXES
2 OTHERWISE DUE ON THE TAXPAYER'S INCOME IN THE INCOME TAX YEAR
3 FOR WHICH THE CREDIT IS BEING CLAIMED, THE AMOUNT OF THE CREDIT
4 NOT USED AS AN OFFSET AGAINST INCOME TAXES IN SAID INCOME TAX
5 YEAR MAY BE CARRIED FORWARD AND USED AS A CREDIT AGAINST
6 SUBSEQUENT YEARS' INCOME TAX LIABILITY FOR A PERIOD NOT TO EXCEED
7 FIVE YEARS AND SHALL BE APPLIED FIRST TO THE EARLIEST INCOME TAX
8 YEARS POSSIBLE. ANY CREDIT REMAINING AFTER SAID PERIOD SHALL NOT
9 BE REFUNDED TO THE TAXPAYER.
10 SECTION 2. Safety clause. The general assembly hereby finds,
11 determines, and declares that this act is necessary for the immediate
12 preservation of the public peace, health, and safety.