2023 Colorado Revised Statutes › Title 39 - TAXATION (§§ 39-1-101 — 39-37-301) › SPECIFIC TAXES (§§ 39-20-101 — 39-37-301) › INCOME TAX (§§ 39-22-101 — 39-22-5508) › Article 22 - Income Tax (§§ 39-22-101 — 39-22-5508) › Part 54 - MIDDLE-INCOME HOUSING TAX CREDIT (§§ 39-22-5401 — 39-22-5409) › Section 39-22-5403 - Credit against tax - middle-income housing developments

(1)
For the income tax years during the credit period, a qualified taxpayer is allowed a credit against the income taxes imposed by this article 22 in an amount determined by the authority pursuant to this part 54.
(2)
The authority may allocate a credit to the owner of a qualified development by issuing an allocation certificate to the owner. The authority may determine the time at which it will issue an allocation certificate. The authority shall determine the amount of the credit. All credit allocations must be made according to the allocation plan and each credit must be necessary for the financial feasibility of the Qualified development.
(3)
The authority shall not allocate a credit to an owner pursuant to this part 54 unless the qualified development meets the following requirements:
(a)
The qualified development is the subject of a recorded restrictive covenant requiring the development to be maintained and operated as a qualified development for the length of the compliance period or longer; and
(b)
The qualified development meets the accessibility and adaptability requirements of title VIII of the federal "Civil Rights Act of 1968", as amended by the federal "Fair Housing Amendments Act of 1988", 24 U.S.C. 3601 et seq.
(4)
(a)
During each calendar year of the period beginning on January 1, 2025, and ending on December 31, 2029, the authority may allocate a credit, the full amount of which may be claimed by a qualified taxpayer against the taxes imposed by this article 22 for each tax year of the five-year credit period.
(b)
(I)
The aggregate amount of all credits allocated by the authority in each calendar year must not exceed the following amounts:
(A)
For calendar year 2025, five million dollars;
(B)
For calendar year 2026, five million dollars;
(C)
For calendar year 2027, ten million dollars;
(D)
For calendar year 2028, ten million dollars; and
(E)
For calendar year 2029, ten million dollars.
(II)
The authority may also allocate any unallocated credits from preceding calendar years, and these unallocated credits are not included in the annual dollar limits specified in subsection (4)(b)(I) of this section.
(c)
The authority shall add the aggregate amount of any unallocated credits remaining as of December 31, 2029, to the amount of credits the authority may allocate pursuant to part 21 of this article 22.
(5)
If the amount of a credit allocated pursuant to this section exceeds the taxes due on the qualified taxpayer's income for the taxable year, the excess credit amount may be carried forward as a credit against the Qualified taxpayer's income tax liability for up to three tax years following the credit period and must be applied first to the earliest years possible. Any amount of the credit that is not applied against income tax liability within this three-year carry-forward period shall not be refunded to the taxpayer.
(6)
If an owner of a qualified development receiving an allocation of a credit is a partnership, limited liability company, S corporation, or similar pass-through entity, the owner may allocate the credit among its partners, shareholders, members, or other qualified taxpayers in any manner agreed to by such persons, regardless of whether any such persons are deemed a partner for federal income tax purposes. The owner shall certify to the department the amount of credit allocated to each partner, shareholder, member, or other qualified taxpayer. Each partner, shareholder, member, or other qualified taxpayer admitted as a partner, shareholder, member, or other qualified taxpayer of the owner prior to the filing of a tax credit claiming the credit is allowed to claim such amount, subject to any restrictions set forth in this part 54 or imposed by the authority or the department.
(7)
To claim the tax credit allowed in this part 54, an owner of a qualified development to which the authority allocated a credit and any qualified taxpayer to which an owner has allocated a portion of its credit shall file with its state income tax return the following documents:
(a)
A copy of the allocation certificate issued by the authority; and
(b)
A copy of the owner's certification to the department regarding its allocation of the credit among the qualified taxpayers having ownership interests in the qualified development, if any.
Added by 2024 Ch. 287,§ 1, eff. 5/30/2024.