Concerning the removal of the maximum age requirement for the state earned income tax credit.
Summary
HB 26-1240 would remove the maximum age limit for Colorado’s state earned income tax credit (EITC), beginning with tax years starting on or after January 1, 2028. Under current law, older workers can be excluded from the state credit because of age-based eligibility rules tied to the federal EITC. The bill keeps the existing income and work requirements, but makes the state credit available to qualifying residents regardless of age, aligning Colorado’s policy more closely with the federal EITC rules that no longer impose a maximum age limit.
The bill also preserves the state credit’s calculation structure. For eligible taxpayers, the Colorado EITC would remain a percentage of the federal credit, with the bill specifying that the new age-neutral eligibility applies in the same manner as the earlier expansion for younger workers. The legislative declaration frames the change as a fairness and anti-poverty measure aimed at supporting working seniors, grandparents, and other older adults who remain in the workforce.
Impact
The bill would amend Colorado Revised Statutes section 39-22-123.5 to add a new provision allowing residents to claim the state EITC without regard to maximum age, effective for tax years beginning on or after January 1, 2028. It also updates related subsections so the new age-neutral category is included in the percentage-based calculation used to determine the state credit. The practical effect is to expand eligibility for low- and moderate-income older workers while leaving the credit’s income-based structure intact.
Sentiment
The bill appears generally favorable in concept, with the introduced text strongly supporting the policy as a fairness and workforce-support measure for older Coloradans. The legislative declaration emphasizes poverty reduction, workforce participation, and support for multigenerational households, suggesting broad pro-expansion sentiment among the sponsors. However, the available voting history shows the bill was laid over unamended in House Appropriations and that an amendment failed, indicating some procedural or fiscal hesitation even if the underlying policy was well supported.
Contention
The main point of contention is likely fiscal impact and the timing of the expansion. The bill describes the change as a modest fiscal investment, but expanding the EITC to additional taxpayers can reduce state revenue, which may explain resistance or amendment activity in Appropriations. Another possible issue is whether Colorado should mirror the federal EITC’s age rules for older workers, though the bill’s sponsors argue that excluding workers over 65 is inequitable when they meet the same income and work requirements as younger filers.