140,000 Colorado seniors can now claim new refundable tax credit for housing
DENVER, CO – Governor Jared Polis today signed HB22-1205, which will save seniors money on housing by creating a temporary new income tax credit.
“Coloradans are feeling the pressures of rising costs from pandemic-induced inflation, supply chain challenges and rising gas prices, so we made saving people money our top priority this session,” said Rep. Chris Kennedy, D-Lakewood. “We reduced property taxes, made record investments to bring down the cost of housing, and passed legislation to put more money into people’s pockets. With this law, 140,000 low-income Colorado seniors save $100 million on housing. This will cut taxes and directly boost the incomes of older Coloradans who rent their homes or haven’t owned them long enough to qualify for the senior homestead exemption.”
“This year we took important steps to alleviate the pressure many families are facing due to pandemic-induced inflation and the rising cost of living, and this new law is a key component of that progress,” said Senator Chris Hansen, D-Denver. “This measure will save older Coloradans millions of dollars on housing, make Colorado a more affordable place to live, and ensure seniors can remain in the communities they have called home for years.”
“This new law will put $100 million back into seniors’ pockets, save seniors money on housing, and help vulnerable Coloradans afford the rising cost of living in our state,” said Rep. Mike Weissman, D-Aurora. “With so many Coloradans facing rent increases, higher property taxes, or an unaffordable home market, we passed a package of bills this session to save people money on housing. In addition to the new tax credit signed into law today, Governor Polis has signed bills into law to reduce property taxes by $274 on average and direct $428 million in federal funds to build more affordable homes, develop middle-income housing, and construct innovative and modular homes.”
“Rising housing costs are putting folks all across Colorado in a bind, and it’s hitting those on fixed incomes, like many seniors, especially hard,” said Senator James Coleman, D-Denver. “This new law will give those folks immediate relief by creating a new tax break that will save thousands of Colorado money on housing and help them stay in their homes and their communities.”
HB22-1205, sponsored by Representatives Chris Kennedy and Mike Weissman and Senators Chris Hansen and James Coleman, will save Colorado seniors over $100 million on their housing costs by creating a new refundable income tax credit. Seniors with incomes under $75,000 who have not claimed the senior homestead exemption will be eligible for the tax credit through their 2022 income tax returns. The credit starts at $1,000 for taxpayers with incomes below $25,000 and phases out slowly by $10 for every $500 of income above $25,000. Because the credit is refundable, taxpayers will receive the benefit even if the credit exceeds their tax liability. According to the bill’s fiscal note prepared by nonpartisan staff, nearly 60,000 Coloradans will receive the full $1,000 credit, and up to 77,000 additional Coloradans will see tax relief under the law.
The chart below from the bill’s fiscal note shows the tax credit amount as it phases out by income level.