This bill improves the administration and oversight of an existing state income tax credit available to students who pay tuition and fees for qualifying higher education semesters.
KEY PROVISIONS
Clarifies Existing Statute:
The bill refines the legal language governing the tuition tax incentive to ensure it can be more effectively implemented and interpreted by the Department of Revenue.
Improves Data Tracking & Reporting:
Strengthens mechanisms for the state to monitor usage, track outcomes, and evaluate the incentive’s impact on college affordability and completion.
Administrative Funding:
Allocates $135,446 in FY 2025–26 to the Department of Revenue’s Taxation Business Group for systems and staffing needed to manage these changes.
Bottom Line: This is a technical and administrative bill that enhances the functionality, transparency, and accountability of Colorado’s tax credit for higher education tuition, making it easier to manage and assess. It does not expand or reduce the credit itself.
Summary
Joint Budget Committee. The state allows a student pursuing
higher education who satisfies statutorily specified eligibility criteria to claim an income tax incentive for amounts paid for tuition and fees for qualifying academic semesters or terms that the student completes. The bill clarifies the statute that provides for the income tax incentives to improve the administration, including data tracking and reporting, of the incentive.
For the 2025-26 state fiscal year, $135,446 is appropriated to the
department of revenue for use by the taxation business group to implement the bill.
