Colo. Code Regs. 39-22-119
Current through Register Vol. 47, No. 20, October 25, 2024
Rule 39-22-119 - Child Care Expenses Tax CreditBasis and Purpose. The bases for this rule are sections 39-21-112(1) and 39-22-119, C.R.S. The purpose of this rule is to clarify that the child care expenses tax credit must be adjusted if the federal credit on which it is based is adjusted, and to describe the proper apportionment of the credit allowed to part-year Colorado residents.
(1) The allowable Colorado child care expenses tax credit is equal to a percentage of the federal tax credit allowed for child care expenses. If the federal tax credit a taxpayer claims for child care expenses is disallowed, in whole or in part, or otherwise adjusted, the allowable Colorado child care expenses tax credit shall be adjusted accordingly based on the amount of the federal credit that is allowed.(2)Part-Year Residents. In the case of a part-year Colorado resident, the allowable child care expenses tax credit shall be apportioned by multiplying the credit otherwise calculated pursuant to section 39-22-119, C.R.S., by the ratio determined under section 39-22-110(1), C.R.S.; except that the ratio for apportioning the child care expenses tax credit may not exceed 100%, even if the ratio determined under section 39-22-110(1), C.R.S., exceeds 100%. (a)Example 1. Taxpayer A is a part-year Colorado resident in tax year 2020. Their apportionment ratio determined pursuant to section 39-22-110(1), C.R.S., is 60%. Taxpayer A is allowed a credit of $1,000 on their 2020 federal income tax return for child care expenses. Taxpayer A satisfies the requirements for the child care expenses tax credit pursuant to section 39-22-119, C.R.S. The Colorado child care expenses tax credit allowed to Taxpayer A is calculated first by multiplying the $1,000 federal credit by 50%, pursuant to section 39-22-119 (1.7), C.R.S., and then multiplying the result ($500) by the 60% apportionment ratio, pursuant to section 39-22-119(4), C.R.S. Taxpayer A is allowed a Colorado child care expenses tax credit of $300.(b)Example 2. Taxpayer B is a part-year Colorado resident in tax year 2020. Their apportionment ratio determined pursuant to section 39-22-110(1), C.R.S., is 110%. Taxpayer B is allowed a $1,000 credit on their 2020 federal income tax for child care expenses. Taxpayer B satisfies the requirements for the child care expenses tax credit pursuant to section 39-22-119, C.R.S. The Colorado child care expenses tax credit allowed to Taxpayer B is calculated first by multiplying the $1,000 federal credit by 50%, pursuant to section 39-22-119 (1.7), C.R.S., and then multiplying the result ($500) by the 100%, pursuant to section 39-22-119(4), C.R.S., and paragraph (2) of this rule, because the apportionment ratio determined pursuant to section 39-22-110(1), C.R.S., exceeds 100%. Taxpayer B is allowed a Colorado child care expenses tax credit of $500.Colorado Register, Vol 37, No. 14. July 25, 2014, effective 8/14/201437 CR 18, September 25, 2014, effective 10/15/201437 CR 19, October 10,2014, effective 10/30/201437 CR 22, November 25, 2014, effective 12/16/201438 CR 04, February 25, 2015, effective 3/17/201538 CR 07, April 10, 2015, effective 4/30/201538 CR 11, June 10, 2015, effective 6/30/201538 CR 22, November 25, 2015, effective 12/15/201538 CR 24, December 25, 2015, effective 1/14/201638 CR 24, December 25, 2015, effective 1/19/201639 CR 01, January 10, 2016, effective 1/30/201639 CR 16, August 25, 2016, effective 9/14/201640 CR 08, April 25, 2017, effective 5/15/201740 CR 12, June 25, 2017, effective 7/15/201740 CR 16, August 25, 2017, effective 9/14/201740 CR 23, December 10, 2017, effective 1/1/201841 CR 14, July 25, 2018, effective 8/14/201841 CR 20, October 25, 2018, effective 11/14/201842 CR 02, January 25, 2019, effective 12/18/201842 CR 02, January 25, 2019, effective 12/18/2018, expires 4/17/201942 CR 06, March 25, 2019, effective 4/14/201943 CR 04, February 25, 2020, effective 3/16/202043 CR 13, July 10, 2020, effective 6/2/202043 CR 17, September 10, 2020, effective 9/30/202044 CR 03, February 10, 2021, effective 3/2/202144 CR 07, April 10, 2021, effective 4/30/202144 CR 08, April 25, 2021, effective 5/15/202145 CR 01, January 10, 2022, effective 1/30/202245 CR 04, February 25, 2022, effective 3/17/202245 CR 05, March 10, 2022, effective 3/30/202246 CR 11, June 10, 2023, effective 5/2/202346 CR 09, May 10, 2023, effective 5/30/2023