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$38M Annual Tax Credit for College Tuition in Colorado: Save Up to $2,700 Per Student -Meet These Criteria to Qualify!

Save Up to $2,700 Per Student Starting 2025

Colorado‘s New $38M College Tuition Tax Credit

According to the report of The Center Square, Governor Jared Polis recently signed House Bill 24-1430 into law introducing a new refundable state income tax credit aimed at reducing the cost of college tuition for Colorado students. This initiative which is expected to cost the state $38 million annually seeks to encourage more high school graduates to enroll in higher education institutions within Colorado. Starting in the 2025 tax year and continuing through 2032 students can apply this tax credit towards tuition and fees at public state institutions, community colleges, technical schools and occupational educational schools. To qualify for this credit students must meet specific criteria. They need to have graduated from a Colorado high school or an equivalent program within the past two years, have a household adjusted gross income of $90,000 or less, qualify for in-state tuition, be enrolled in at least six credit hours per term and maintain a grade point average of 2.5 or higher.

The bill was passed unanimously in the House and with a significant majority in the Senate on the final day of the 2024 legislative session. Governor Polis emphasized that this law will strengthen Colorado’s workforce, help students gain in-demand skills, and make higher education more affordable. The tax credit is expected to reduce state tax revenue by $18.1 million in fiscal year 2024-2025 increasing to $37.8 million by fiscal year 2026-2027 and remain at similar levels through 2032. The average credit amount is estimated to be $2,700 for students at four-year colleges $2,000 for students at technical colleges and $1,000 for those at two-year colleges. However, these figures could vary based on enrollment and tuition changes. Eligible students can claim a maximum of 65 credit hours under this program. Scholarships and grants must be deducted from the total tuition and fees before applying the tax credit.

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$38M Annual Tax Credit for College Tuition in Colorado: Save Up to $2,700 Per Student -Are You Eligible? (PHOTO: MPR News)

Reporting Requirements and Benefits for Students

Furthermore, the Department of Higher Education is required to report eligible students to the Department of Revenue annually starting January 31, 2026. The Department must submit a detailed report on the program’s progress to the Joint Budget Committee and the Education Committees of both the House and Senate by June 30, 2027 and annually thereafter until 2037. Governor Polis believes this tax credit will save Colorado students thousands of dollars making higher education more accessible and supporting the state’s economic growth by developing a well-educated workforce.

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