SB25B-009 Summary

• Creates a temporary suspension and prorating mechanism for most income tax credits based on state revenue forecasts, excluding the Colorado Affordable Housing Tax Credit and Earned Income Tax Credits.

• Beginning with the December 2025 quarterly revenue forecast, each forecast must include two estimates of excess state revenues: one assuming all income tax credits are available and one assuming no credits are available; credit availability is determined by which scenario results in the least excess revenue.

• Makes the Family Affordability Tax Credit nonrefundable beginning in tax year 2025 (was previously refundable through 2024).

• Modifies three environmental tax credits (electric lawn equipment, heat pump technology, and electric bicycles) to end as regular credits after tax year 2025 and authorizes the Department of Revenue to sell up to $40 million in tax credit certificates to qualified taxpayers in fiscal year 2025-26, with proceeds credited to the general fund.

• Purchased tax credits can be claimed starting in tax year 2030 and must be fully claimed by tax year 2050.