Did you know Colorado has over 30 state tax credits? This filing season, you may qualify for another: the family affordability tax credit is designed to help families with children, especially those with lower incomes.
This tax credit is offered to Coloradans for the first time thanks to legislation passed last year. “This historic effort will significantly reduce childhood poverty in Colorado,” said Speaker Pro Tempore Chris deGruy Kennedy (D-Lakewood) and one of the bill’s sponsors. “[It will] boost the incomes of hardworking families, and help millions of Coloradans who are feeling the greatest impacts of the cost of living in our state.”
But who is eligible for this new tax break and how much can you expect to receive? Read on.
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What is the new tax credit for families in Colorado?
The Colorado family affordability tax credit is new this year. The tax break is designed to help lower-income residents with children under 17 at the end of the tax year.
Income eligibility requirements for tax year 2024 are as follows:
- Single, head of household, and married filing separately taxpayers must have an adjusted gross income (AGI) of $85,000 or less.
- Married filing joint filers must have an AGI of $95,000 or less.
You can also use the Get Ahead Colorado state tool to check your eligibility for this tax credit and many others.
Colorado tax refund credit
The 2024 Colorado family affordability tax credit is refundable, meaning eligible Colorado families will receive money back even if they owe nothing in taxes.
But how much you get depends on three factors:
- Filing status.
- Adjusted gross income (AGI).
- Age and number of children (families can receive up to $3,200 per child 5 and younger and up to $2,400 per child 6 to 16).
The amount of benefit you can receive ranges from $90 to $3,200 per child. There’s a phaseout for higher incomes.
For instance, families with the lowest AGI amounts and two children (one in each age category) may receive up to $5,600 in tax benefits.
But if your AGI is $67,000 (and you have one child age 5, and another age 15):
- Single filers are only eligible for a total credit of $1,365.
- Married filing joint taxpayers are only eligible for a total credit of $2,135.
For complete tables on all the income levels and phaseout amounts, see Colorado’s Department of Revenue website.
Note: The family affordability tax credit is only offered if there’s a surplus in state revenue. If next year’s state budget is low, the credit may be lower than the above amounts, or not offered at all.
Colorado child tax credit 2024
While the family affordability tax credit is new, tax breaks for Colorado families are not. Colorado also has a child tax credit for families with younger children:
- Married filing joint taxpayers with incomes of $85,000 or less ($75,000 for single filers) may qualify.
- Families can get up to 10-60% of the federal child tax credit per child 5 or younger.
For more information, check out Kiplinger’s report States That Offer a Child Tax Credit.
Colorado tax credits
The Centennial State offers several family and student tax credits you may claim in the 2025 filing season, including:
- The Colorado Promise tax credit, providing two years of tuition and fees for qualifying students.
- Colorado’s state child and dependent care tax credit, worth up to 50% of the federal child and dependent care tax credit.
- The Low-Income Child Care Expenses Credit, worth up to $1,000 for two or more dependents.
- Child care contribution credit, for taxpayers who contributed to qualified child care facilities and programs in the state.
Be sure to scroll through the list of Colorado tax credits on the state’s Department of Revenue website before filing your taxes this season. Also, don’t forget to check the box on your return claiming your Colorado TABOR refund when filing taxes.
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