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Income Tax Checkoffs 

Table of Contents

Background

The Colorado individual income tax return form allows taxpayers to contribute to various listed organizations by donating a portion of their income tax refund or increasing the amount owed on their tax return.  Legislation is required to create new income tax check-off.

Only 20 check-off programs can appear on an indivisual income tax form each year.  To ensure that the cap is not exceeded, the priority order system specifies that continued or renewed program take precedence over newly created programs.  Tax check-offs must contain a sunset date and meet a yearly minimum contribution of $50,000 by the third year from when it first appeared on the form and subsequent tax years to remain on the tax form.  Contributions are calculated from January 1st through September 30th of each tax year.  Thus, if a program that has appeared on the form is renewed or continued and has donations of at least $50,000, the program remains on the form in the following tax year.  Under current law, the Western Slope Military Veterans Cemetery and Homeless Prevention Activities Program Nonprofit Donation funds are exempt from the mandatory sunset process.

Newly created programs can only appear on the tax form when an existing program is removed.  The order of programs in the queue is determined by the date and time that the Governor signs each bill.  It should be notes that 19 voluntary contributions will appear on the 2019 Colorado individual income tax form.

According to the Colorado Department of Revenue, the following program funds will be available as income tax checkoffs in the 2018 tax year:

  1. Nongame and Endangered Wildlife Cash Fund;
  2. Colorado Domestic Abuse Program Fund;
  3. Homeless Prevention Activities Program Fund;
  4. Western Slope Military Veterans Cemetery Fund;
  5. Pet Overpopulation Fund;
  6. Military Family Relief Fund;
  7. American Red Cross Colorado Disaster Response, Readiness, and Preparedness Fund;
  8. Habitat for Humanity of Colorado Fund;
  9. Special Olympics of Colorado Fund;
  10. Colorado Healthy Rivers Fund;
  11. Alzheimer's Association Fund;
  12. Colorado Cancer Fund;
  13. Make-a-Wish Foundation of Colorado Fund;
  14. Colorado Multiple Sclerosis Fund;
  15. Unwanted Horse Fund;
  16. Urban Peak Housing Support Services for Youth Experiencing Homelessness Fund;
  17. Family Caregiver Support Fund;
  18. Young Americans Financial Education Fund; and
  19. This line is reserved for future use for the Nonprofit Donation Fund designated by SB 18-141.

State Comparisons

In 1977, the Colorado Nongame and Endangered Wildlife Fund became the first state income tax checkoff fund in the United States. Since, checkoffs have grown in popularity across states.  According to a 2003 survey by the Federation of Tax Administrators, 220 checkoff programs were identified across 41 states and the District of Columbia for tax year 2002.  The first national checkoff program was implemented in tax year 1972, when taxpayers were allowed to designate $1 of their income tax liability to a special presidential campaign fund.

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1Section 39-22-1001, C.R.S.
 
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