How to Get the Colorado TABOR Refund on Your Tax Return

Colorado taxpayers can take advantage of the Taxpayer’s Bill of Rights (TABOR) refund, which returns excess state revenue to residents. This refund provides financial relief and is an essential aspect of tax planning for eligible individuals.

Eligibility Requirements

To qualify for the Colorado TABOR refund, taxpayers must file a Colorado state income tax return for the relevant tax year, establishing residency and tax liability within the state. Full-year residents are automatically eligible, while part-year residents may qualify based on their time in Colorado. Non-residents are excluded as they do not contribute to the state’s tax base.

Income thresholds may also affect eligibility, particularly in years with a smaller state budget surplus. These thresholds are periodically adjusted and outlined in the Colorado Department of Revenue’s annual tax guidance. Taxpayers should review these guidelines to determine how their income level impacts their eligibility.

Determining the Refund Amount

The refund amount depends on the state’s fiscal performance and statutory formulas for distributing excess revenue. The surplus is calculated based on revenue collections exceeding the constitutional limit set by TABOR, which is adjusted annually for inflation and population growth.

In 2024, a graduated scale was used to allocate refunds, with lower-income taxpayers receiving a higher percentage of the surplus. This method aims to provide greater relief to those who need it most. Specific refund amounts for income brackets are detailed in the annual tax guidance.

Claiming the Refund on Your Return

Taxpayers must ensure their documentation is accurate and complete before filing. This includes verifying residency status and correctly reporting income. The Colorado Department of Revenue provides resources, including checklists and guides, to assist with the refund process.

The refund is claimed using the state tax return form DR 0104. The amount is entered based on the state’s guidelines. Tax preparation software often simplifies this process by incorporating the latest tax codes and calculations. Taxpayers should double-check for errors in the refund section. For joint filers, ensure both parties’ details are accurate, as their filing status may affect the refund calculation.

Adjustments for Joint Filers

Joint filers must account for specific considerations when claiming the TABOR refund. Their combined income may place them in a different refund tier than if filing separately. This aggregation is particularly relevant when the state uses a graduated refund scale.

Deductions and credits can also impact the refund. For example, deductions for mortgage interest or charitable contributions may lower taxable income and influence the refund amount. Joint filers should ensure all income and deductions are accurately reported to avoid complications. Consulting a tax professional familiar with Colorado tax codes can be helpful for those with complex financial situations.

Distribution Timeline

The refund distribution process begins after the state finalizes its fiscal year-end revenue calculations, typically by June 30. Refunds are distributed via direct deposit or paper checks. Taxpayers who choose direct deposit often receive payments sooner, sometimes as early as August. Paper checks are mailed in the following weeks. Those filing extensions may experience delays, as refunds are processed after their returns are submitted.

The state sets deadlines for issuing refunds, but taxpayers should monitor updates from the Department of Revenue for any changes to the schedule. Staying informed helps taxpayers plan their finances and anticipate their refunds.

Addressing Delays or Missing Funds

Delays or missing refunds can result from errors on the tax return, such as incorrect bank information or discrepancies in reported income. Refunds may also be offset to cover back taxes, child support, or other government debts.

Taxpayers should first review their tax returns for mistakes. If no errors are found, contacting the Colorado Department of Revenue is the next step. The department’s Refund Status tool allows taxpayers to track their payments. If refunds are offset, taxpayers will receive a notice explaining the amount withheld and the reason.

For missing funds, taxpayers may need to file a formal inquiry or request a replacement check using Form DR 0137. Accurate records and prompt action are essential, as delays in addressing issues can complicate the process.