Second Regular Session
Seventy-fourth General Assembly
STATE OF COLORADO
INTRODUCED
LLS NO. 24-0697.01 Jed Franklin x5484
HOUSE BILL 24-1249
House Committees Senate Committees
Agriculture, Water & Natural Resources
A BILL FOR AN ACT
C
ONCERNING A STATE INCOME TAX CREDIT FOR ACTIVE101
AGRICULTURAL STEWARDSHIP PRACTICES .102
Bill Summary
(Note: This summary applies to this bill as introduced and does
not reflect any amendments that may be subsequently adopted. If this bill
passes third reading in the house of introduction, a bill summary that
applies to the reengrossed version of this bill will be available at
http://leg.colorado.gov.)
The bill establishes a state income tax credit for active qualified
stewardship practices on a farm or ranch beginning January 1, 2026.
There are 3 tiers of tax credits that may be earned by a qualified taxpayer.
For actively practicing one qualified stewardship practice, a qualified
taxpayer may earn a state income tax credit equal to $75 per acre of land
covered by the qualified stewardship practice, up to a maximum credit of
HOUSE SPONSORSHIP
Winter T. and Martinez,
SENATE SPONSORSHIP
Pelton R. and Roberts,
Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment.
Capital letters or bold & italic numbers indicate new material to be added to existing law.
Dashes through the words or numbers indicate deletions from existing law. $150,000 in one income tax year. For actively practicing 2 qualified
stewardship practices, a qualified taxpayer may earn a state income tax
credit equal to $100 per acre of land covered by the qualified stewardship
practices, up to a maximum credit of $200,000 in one income tax year.
For actively practicing 3 or more qualified stewardship practices, a
qualified taxpayer may earn a state income tax credit up to $150 per acre
of land covered by the qualified stewardship practices, up to a maximum
of $300,000 per income tax year. The tax credit is refundable and may not
be carried forward.
To claim the credit, a qualified taxpayer must apply to the
department of agriculture for a tax credit certificate. The department of
agriculture will evaluate the application and issue the certificate if the
taxpayer qualifies for the tax credit. If a tax credit certificate is issued, the
qualified taxpayer must attach it to the taxpayer's income tax return and
submit it to the department of revenue.
The aggregate amount of tax credits issued in one calendar year
cannot exceed $10 million. After certificates have been issued for credits
that exceed an aggregate of $10 million for all qualified taxpayers during
a calendar year, any claims that exceed the amount allowed are placed on
a wait list in the order submitted and a certificate is issued for use of the
credit in the next income tax year. No more than $5 million in claims
shall be placed on the wait list in any given calendar year.
Only one tax credit certificate may be issued per qualified taxpayer
in a calendar year, and the qualified taxpayer claiming the credit may only
receive the tax credit for up to 3 income tax years. No credit may be
earned if the qualified taxpayer has received another tax credit, a tax
deduction, or a grant related to agricultural land health from any source
during the income tax year for which the tax credit is sought.
Be it enacted by the General Assembly of the State of Colorado:1
SECTION 1. In Colorado Revised Statutes, add 39-22-560 as2
follows:3
39-22-560. Agricultural stewardship tax credit - tax preference4
performance statement - legislative declaration - definitions - repeal.5
(1) (a) I
N ACCORDANCE WITH SECTION 39-21-304 (1), WHICH REQUIRES6
EACH BILL THAT CREATES A NEW TAX EXPENDITURE TO INCLUDE A TAX7
PREFERENCE PERFORMANCE STATEMENT AS PART OF A STATUTORY8
LEGISLATIVE DECLARATION, THE GENERAL ASSEMBLY DECLARES THAT THE9
HB24-1249-2- PURPOSE OF THE TAX CREDIT CREATED IN THIS SECTION IS TO INDUCE1
CERTAIN DESIGNATED BEHAVIOR BY TAXPAYERS , SPECIFICALLY TO2
ENCOURAGE AN INDIVIDUAL TO ACTIVELY PRACTICE ONE OR MORE3
QUALIFIED STEWARDSHIP PRACTICES ON A FARM OR RANCH , INCLUDING4
ANY PRACTICE THAT INCREASES SOIL HEALTH , IMPROVES WATER5
EFFICIENCY, OR CREATES MORE DIVERSE AND BENEFICIAL ECOSYSTEMS6
WHILE MAINTAINING THE PRODUCTIVITY OF THE FARM OR RANCH .7
(b) T
HE GENERAL ASSEMBLY AND THE STATE AUDITOR SHALL8
MEASURE THE EFFECTIVENESS OF THE CREDIT IN ACHIEVING THE PURPOSE9
SPECIFIED IN SUBSECTION (1)(a) OF THIS SECTION BASED ON THE10
INFORMATION REQUIRED TO BE MAINTAINED BY AND REPORTED TO THE11
STATE AUDITOR BY THE DEPARTMENT OF AGRICULTURE PURSUANT TO12
SUBSECTION (4)(b) OF THIS SECTION.13
(2) A
S USED IN THIS SECTION, UNLESS THE CONTEXT OTHERWISE14
REQUIRES:15
(a) "C
REDIT CERTIFICATE" MEANS A CERTIFICATE ISSUED BY THE16
DEPARTMENT OF AGRICULTURE CERTIFYING THAT A QUALIFIED TAXPAYER17
QUALIFIES FOR AN INCOME TAX CREDIT AUTHORIZED IN THIS SECTION AND18
SPECIFYING THE AMOUNT OF THE CREDIT ALLOWED AND THE INCOME TAX19
YEAR FOR WHICH THE CREDIT MAY BE CLAIMED .20
(b) "Q
UALIFIED STEWARDSHIP PRACTICE " MEANS ROTATIONAL21
GRAZING, ROTATIONAL CROPS, REDUCED TILL SOIL, NO TILL SOIL, COVER22
CROPPING, INTERSEEDING, COMPOST APPLICATION , OR ANY OTHER23
PRACTICE THAT INCREASES SOIL HEALTH , IMPROVES WATER EFFICIENCY,24
OR CREATES MORE DIVERSE AND BENEFICIAL ECOSYSTEMS WHILE25
MAINTAINING THE PRODUCTIVITY OF THE FARM OR RANCH AS SPECIFIED BY26
A RULE ISSUED BY THE DEPARTMENT OF AGRICULTURE .27
HB24-1249
-3- (c) "QUALIFIED TAXPAYER" MEANS A PERSON SUBJECT TO TAX1
PURSUANT TO THIS ARTICLE 22 WHO ACTIVELY PRACTICES A QUALIFIED2
STEWARDSHIP PRACTICE ON A FARM OR RANCH LOCATED IN THE STATE3
DURING AN INCOME TAX YEAR , WHETHER THE QUALIFIED STEWARDSHIP4
PRACTICE IS NEWLY PRACTICED DURING THE INCOME TAX YEAR OR IS5
BEING CONTINUED FROM A PRIOR INCOME TAX YEAR .6
(3) (a) S
UBJECT TO THE LIMITATIONS SET FORTH IN SUBSECTION7
(3)(b)
OF THIS SECTION, FOR INCOME TAX YEARS COMMENCING ON OR8
AFTER JANUARY 1, 2026, BUT BEFORE JANUARY 1, 2031, A QUALIFIED9
TAXPAYER IS ALLOWED A CREDIT AGAINST THE INCOME TAXES IMPOSED BY10
THIS ARTICLE 22 IN AN AMOUNT EQUAL TO:11
(I) F
OR A QUALIFIED TAXPAYER ACTIVELY PRACTICING ONE12
QUALIFIED STEWARDSHIP PRACTICE DURING AN INCOME TAX YEAR ,13
SEVENTY-FIVE DOLLARS PER ACRE OF LAND SUBJECT TO A QUALIFIED14
STEWARDSHIP PRACTICE, LIMITED TO A MAXIMUM CREDIT AMOUNT OF ONE15
HUNDRED FIFTY THOUSAND DOLLARS PER INCOME TAX YEAR ;16
(II) F
OR A QUALIFIED TAXPAYER ACTIVELY PRACTICING TWO17
QUALIFIED STEWARDSHIP PRACTICES DURING AN INCOME TAX YEAR , ONE18
HUNDRED DOLLARS PER ACRE OF LAND SUBJECT TO A QUALIFIED19
STEWARDSHIP PRACTICE, LIMITED TO A MAXIMUM CREDIT AMOUNT OF TWO20
HUNDRED THOUSAND DOLLARS PER INCOME TAX YEAR ; AND21
(III) F
OR A QUALIFIED TAXPAYER ACTIVELY PRACTICING THREE OR22
MORE QUALIFIED STEWARDSHIP PRACTICES DURING AN INCOME TAX YEAR ,23
ONE HUNDRED FIFTY DOLLARS PER ACRE OF LAND SUBJECT TO A QUALIFIED24
STEWARDSHIP PRACTICE, LIMITED TO A MAXIMUM CREDIT AMOUNT OF25
THREE HUNDRED THOUSAND DOLLARS PER INCOME TAX YEAR .26
(b) A
QUALIFIED TAXPAYER MAY ONLY CLAIM THE CREDIT27
HB24-1249
-4- AUTHORIZED BY THIS SECTION:1
(I) F
OR THREE INCOME TAX YEARS; AND2
(II) I
F THE QUALIFIED TAXPAYER HAS NOT RECEIVED A TAX3
CREDIT, TAX DEDUCTION, OR GRANT RELATED TO THE AGRICULTURAL4
LAND AND THE QUALIFYING STEWARDSHIP PRACTICE DURING AN INCOME5
TAX YEAR FOR WHICH A TAX CREDIT IS CLAIMED PURSUANT TO THIS6
SECTION FROM ANY OTHER SOURCE .7
(4) (a) A
QUALIFIED TAXPAYER SHALL SUBMIT AN APPLICATION TO8
THE DEPARTMENT OF AGRICULTURE FOR A TAX CREDIT CERTIFICATE TO9
CLAIM THE CREDIT ALLOWED BY THIS SECTION ON A FORM AND IN A10
MANNER PRESCRIBED BY THE DEPARTMENT OF AGRICULTURE . THE11
APPLICATION MUST INCLUDE A MEANS FOR THE TAXPAYER TO NOTE12
WHETHER THE TAXPAYER FILES INCOME TAXES ON A CALENDAR YEAR OR13
FISCAL YEAR BASIS AND INFORMATION TO ALLOW THE DEPARTMENT OF14
AGRICULTURE TO MAKE A DETERMINATION THAT THE STEWARDSHIP15
PRACTICE IS A QUALIFIED STEWARDSHIP PRACTICE , THAT THE QUALIFIED16
TAXPAYER IS ACTIVELY PRACTICING THE QUALIFIED STEWARDSHIP17
PRACTICE, AND TO VERIFY THE AMOUNT FOR WHICH THE TAX CREDIT18
CERTIFICATE IS APPLIED. A QUALIFIED TAXPAYER MAY RECEIVE ONLY ONE19
TAX CREDIT CERTIFICATE PER INCOME TAX YEAR .20
(b) (I) T
HE DEPARTMENT OF AGRICULTURE SHALL MAINTAIN A21
DATABASE OF ANY INFORMATION DETERMINED NECESSARY BY THE22
DEPARTMENT OF AGRICULTURE TO EVALUATE THE EFFECTIVENESS OF THE23
INCOME TAX CREDIT ALLOWED IN THIS SECTION IN MEETING THE PURPOSE24
SET FORTH IN SUBSECTION (1) OF THIS SECTION AND SHALL PROVIDE SUCH25
INFORMATION, AND ANY OTHER INFORMATION THAT MAY BE NEEDED , IF26
AVAILABLE, TO THE STATE AUDITOR AS PART OF THE STATE AUDITOR 'S27
HB24-1249
-5- EVALUATION OF THIS TAX EXPENDITURE REQUIRED BY SECTION 39-21-305.1
(II) T
HE DEPARTMENT OF AGRICULTURE SHALL , IN A SUFFICIENTLY2
TIMELY MANNER TO ALLOW THE DEPARTMENT OF REVENUE TO PROCESS3
RETURNS CLAIMING THE INCOME TAX CREDIT ALLOWED IN THIS SECTION ,4
PROVIDE THE DEPARTMENT OF REVENUE WITH AN ELECTRONIC REPORT FOR5
THE PRECEDING TAX YEAR THAT LISTS EACH QUALIFIED TAXPAYER TO6
WHICH THE DEPARTMENT OF AGRICULTURE ISSUED A TAX CREDIT7
CERTIFICATE AND INCLUDES THE FOLLOWING INFORMATION :8
(A) T
HE QUALIFIED TAXPAYER'S NAME;9
(B) T
HE AMOUNT OF THE INCOME TAX CREDIT THAT THE10
CERTIFICATE INDICATES THE QUALIFIED TAXPAYER IS ELIGIBLE TO CLAIM ;11
AND12
(C) T
HE QUALIFIED TAXPAYER'S SOCIAL SECURITY NUMBER OR THE13
QUALIFIED TAXPAYER'S COLORADO ACCOUNT NUMBER AND FEDERAL14
EMPLOYER IDENTIFICATION NUMBER .15
(5) I
N ORDER TO CLAIM THE CREDIT AUTHORIZED BY THIS SECTION ,16
A QUALIFIED TAXPAYER SHALL FILE THE TAX CREDIT CERTIFICATE WITH17
THE QUALIFIED TAXPAYER'S STATE INCOME TAX RETURN. THE AMOUNT OF18
THE CREDIT THAT THE QUALIFIED TAXPAYER MAY CLAIM PURSUANT TO19
THIS SECTION IS THE AMOUNT STATED ON THE TAX CREDIT CERTIFICATE .20
(6) T
HE DEPARTMENT OF AGRICULTURE SHALL ISSUE CERTIFICATES21
FOR CREDIT CLAIMS RECEIVED IN THE ORDER SUBMITTED , BUT SHALL NOT22
ISSUE CREDIT CERTIFICATES THAT EXCEED TEN MILLION DOLLARS IN A23
CALENDAR YEAR. AFTER CERTIFICATES HAVE BEEN ISSUED FOR CREDITS24
IN AN AGGREGATE AMOUNT OF TEN MILLION DOLLARS FOR ALL QUALIFIED25
TAXPAYERS DURING A CALENDAR YEAR , ANY ADDITIONAL CLAIMS MUST26
BE PLACED ON A WAIT LIST, WITH PRIORITY FIRST GIVEN TO A QUALIFIED27
HB24-1249
-6- TAXPAYER WHO HAS BEEN ISSUED A TAX CERTIFICATE IN THE CALENDAR1
YEAR PRECEDING THE CALENDAR YEAR IN WHICH THE QUALIFIED2
TAXPAYER IS PLACED ON THE WAIT LIST AND SECOND TO A QUALIFIED3
TAXPAYER WHO APPLIED FOR THE TAX CREDIT AUTHORIZED IN THIS4
SECTION BUT WAS PLACED ON THE WAIT LIST, AND A CERTIFICATE MUST BE5
ISSUED FOR USE OF THE CREDIT IN THE NEXT CALENDAR YEAR ; EXCEPT6
THAT NO MORE THAN FIVE MILLION DOLLARS IN CLAIMS SHALL BE PLACED7
ON THE WAIT LIST IN ANY GIVEN CALENDAR YEAR. NO CLAIM FOR A CREDIT8
IS ALLOWED FOR ANY INCOME TAX YEAR UNLESS A CERTIFICATE HAS BEEN9
ISSUED BY THE DIVISION. IF ALL OTHER REQUIREMENTS OF THIS SECTION10
ARE MET, THE RIGHT TO CLAIM THE CREDIT IS VESTED IN A QUALIFIED11
TAXPAYER AT THE TIME A CREDIT CERTIFICATE IS ISSUED .12
(7) I
F AN INCOME TAX CREDIT AUTHORIZED IN THIS SECTION13
EXCEEDS THE INCOME TAX DUE ON THE INCOME OF THE QUALIFIED14
TAXPAYER FOR THE TAXABLE YEAR , THE EXCESS CREDIT MAY NOT BE15
CARRIED FORWARD AND MUST BE REFUNDED TO THE QUALIFIED16
TAXPAYER.17
(8) T
HIS SECTION IS REPEALED, EFFECTIVE DECEMBER 31, 2034.18
SECTION 2. Act subject to petition - effective date. This act19
takes effect at 12:01 a.m. on the day following the expiration of the20
ninety-day period after final adjournment of the general assembly; except21
that, if a referendum petition is filed pursuant to section 1 (3) of article V22
of the state constitution against this act or an item, section, or part of this23
act within such period, then the act, item, section, or part will not take24
effect unless approved by the people at the general election to be held in25
November 2024 and, in such case, will take effect on the date of the26
official declaration of the vote thereon by the governor.27
HB24-1249
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