Second Regular Session
Seventy-fourth General Assembly
STATE OF COLORADO
REVISED
This Version Includes All Amendments Adopted
on Second Reading in the Second House
LLS NO. 24-0697.01 Jed Franklin x5484
HOUSE BILL 24-1249
House Committees Senate Committees
Agriculture, Water & Natural Resources Finance
Finance Appropriations
Appropriations
A BILL FOR AN ACT
C
ONCERNING A STATE INCOME TAX CREDIT FOR ACTIVE101
AGRICULTURAL STEWARDSHIP
PRACTICES, AND, IN CONNECTION102
THEREWITH, MAKING AN APPROPRIATION .103
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
SENATE
2nd Reading Unamended
May 7, 2024
HOUSE
3rd Reading Unamended
April 29, 2024
HOUSE
Amended 2nd Reading
April 26, 2024
HOUSE SPONSORSHIP
Winter T. and Martinez, Amabile, Bird, deGruy Kennedy, Duran, Joseph, Kipp, Lieder,
Lukens, Lynch, Mauro, McCluskie, McCormick, McLachlan, Titone
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. covered by the qualified stewardship practice, up to a maximum credit of
$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
1249-2- LEGISLATIVE DECLARATION, THE GENERAL ASSEMBLY DECLARES THAT THE1
PURPOSE OF THE TAX CREDIT CREATED IN THIS SECTION IS TO INDUCE2
CERTAIN DESIGNATED BEHAVIOR BY TAXPAYERS , SPECIFICALLY TO3
ENCOURAGE AN INDIVIDUAL TO ACTIVELY PRACTICE ONE OR MORE4
QUALIFIED STEWARDSHIP PRACTICES ON A FARM OR RANCH , INCLUDING5
ANY PRACTICE THAT INCREASES SOIL HEALTH , IMPROVES WATER6
EFFICIENCY, OR CREATES MORE DIVERSE AND BENEFICIAL ECOSYSTEMS7
WHILE MAINTAINING THE PRODUCTIVITY OF THE FARM OR RANCH .8
(b) T
HE GENERAL ASSEMBLY AND THE STATE AUDITOR SHALL9
MEASURE THE EFFECTIVENESS OF THE CREDIT IN ACHIEVING THE PURPOSE10
SPECIFIED IN SUBSECTION (1)(a) OF THIS SECTION BASED ON THE11
INFORMATION REQUIRED TO BE MAINTAINED BY AND REPORTED TO THE12
STATE AUDITOR BY THE DEPARTMENT OF AGRICULTURE PURSUANT TO13
SUBSECTION (4)(b) OF THIS SECTION.14
(2) A
S USED IN THIS SECTION, UNLESS THE CONTEXT OTHERWISE15
REQUIRES:16
(a) "C
REDIT CERTIFICATE" MEANS A CERTIFICATE ISSUED BY THE17
DEPARTMENT OF AGRICULTURE CERTIFYING THAT A QUALIFIED TAXPAYER18
QUALIFIES FOR AN INCOME TAX CREDIT AUTHORIZED IN THIS SECTION AND19
SPECIFYING THE AMOUNT OF THE CREDIT ALLOWED AND THE INCOME TAX20
YEAR FOR WHICH THE CREDIT MAY BE CLAIMED .21
(b) "QUALIFIED STEWARDSHIP PRACTICE" MEANS ANY22
AGRICULTURAL PRACTICE, AS SPECIFIED BY RULES ISSUED BY THE23
COMMISSIONER OF THE DEPARTMENT OF AGRICULTURE, THAT MAY24
INCLUDE A GRAZING OR CROPPING PRACTICE THAT IMPROVES SOIL HEALTH,25
IMPROVES WATER RETENTION AND DROUGHT RESILIENCE , OR CREATES26
MORE DIVERSE AND BENEFICIAL ECOSYSTEMS WHILE MAINTAINING THE27
1249
-3- PRODUCTIVITY OF THE FARM OR RANCH, INCLUDING ROTATIONAL CROPS,1
REDUCED TILLAGE, NO TILLAGE, COVER CROPPING, INTEGRATING2
MANAGED LIVESTOCK GRAZING ON CROPLAND, RANGE IMPROVEMENTS ,3
INTERSEEDING, OR COMPOST APPLICATION.4
(c) "Q
UALIFIED TAXPAYER" MEANS A PERSON SUBJECT TO TAX5
PURSUANT TO THIS ARTICLE 22 WHO ACTIVELY PRACTICES A QUALIFIED6
STEWARDSHIP PRACTICE ON A FARM OR RANCH LOCATED IN THE STATE7
DURING AN INCOME TAX YEAR , WHETHER THE QUALIFIED STEWARDSHIP8
PRACTICE IS NEWLY PRACTICED DURING THE INCOME TAX YEAR OR IS9
BEING CONTINUED FROM A PRIOR INCOME TAX YEAR .10
(3) (a) S
UBJECT TO THE LIMITATIONS SET FORTH IN SUBSECTION11
(3)(b)
OF THIS SECTION, FOR INCOME TAX YEARS COMMENCING ON OR12
AFTER JANUARY 1, 2026, BUT BEFORE JANUARY 1, 2031, A QUALIFIED13
TAXPAYER IS ALLOWED A CREDIT AGAINST THE INCOME TAXES IMPOSED BY14
THIS ARTICLE 22 IN AN AMOUNT EQUAL TO:15
(I) A MINIMUM OF FIVE DOLLARS AND A MAXIMUM OF16
SEVENTY-FIVE DOLLARS PER ACRE OF LAND SUBJECT TO ONE QUALIFIED17
STEWARDSHIP PRACTICE, AS SPECIFIED BY RULE ISSUED BY THE18
COMMISSIONER OF THE DEPARTMENT OF AGRICULTURE , LIMITED TO A19
MAXIMUM CREDIT AMOUNT OF ONE HUNDRED FIFTY THOUSAND DOLLARS20
PER INCOME TAX YEAR;21
(II) A MINIMUM OF TEN DOLLARS AND A MAXIMUM OF ONE22
HUNDRED DOLLARS PER ACRE OF LAND SUBJECT TO TWO QUALIFIED23
STEWARDSHIP PRACTICES , AS SPECIFIED BY RULE ISSUED BY THE24
COMMISSIONER OF THE DEPARTMENT OF AGRICULTURE, LIMITED TO A25
MAXIMUM CREDIT AMOUNT OF TWO HUNDRED THOUSAND DOLLARS PER26
INCOME TAX YEAR; AND27
1249
-4- (III) A MINIMUM OF FIFTEEN DOLLARS AND A MAXIMUM OF ONE1
HUNDRED FIFTY DOLLARS PER ACRE OF LAND SUBJECT TO THREE OR MORE2
QUALIFIED STEWARDSHIP PRACTICES, AS SPECIFIED BY RULE ISSUED BY THE3
COMMISSIONER OF THE DEPARTMENT OF AGRICULTURE , LIMITED TO A4
MAXIMUM CREDIT AMOUNT OF THREE HUNDRED THOUSAND DOLLARS PER5
INCOME TAX YEAR.6
(b) THE DEPARTMENT OF AGRICULTURE MAY ONLY ISSUE TAX7
CREDIT CERTIFICATES TO A QUALIFIED TAXPAYER :8
(I) F
OR THREE INCOME TAX YEARS; AND9
(II) I
F THE QUALIFIED TAXPAYER HAS NOT RECEIVED A TAX10
CREDIT, TAX DEDUCTION, OR GRANT RELATED TO THE AGRICULTURAL11
LAND AND THE QUALIFYING STEWARDSHIP PRACTICE DURING AN INCOME12
TAX YEAR FOR WHICH A TAX CREDIT IS CLAIMED PURSUANT TO THIS13
SECTION FROM ANY OTHER SOURCE .14
(4) (a) A
QUALIFIED TAXPAYER SHALL SUBMIT AN APPLICATION TO15
THE DEPARTMENT OF AGRICULTURE FOR A TAX CREDIT CERTIFICATE TO16
CLAIM THE CREDIT ALLOWED BY THIS SECTION ON A FORM AND IN A17
MANNER PRESCRIBED BY THE DEPARTMENT OF AGRICULTURE . THE18
APPLICATION MUST INCLUDE A MEANS FOR THE TAXPAYER TO NOTE19
WHETHER THE TAXPAYER FILES INCOME TAXES ON A CALENDAR YEAR OR20
FISCAL YEAR BASIS AND INFORMATION TO ALLOW THE DEPARTMENT OF21
AGRICULTURE TO MAKE A DETERMINATION THAT THE STEWARDSHIP22
PRACTICE IS A QUALIFIED STEWARDSHIP PRACTICE , THAT THE QUALIFIED23
TAXPAYER IS ACTIVELY PRACTICING THE QUALIFIED STEWARDSHIP24
PRACTICE, AND TO VERIFY THE AMOUNT FOR WHICH THE TAX CREDIT25
CERTIFICATE IS APPLIED. A QUALIFIED TAXPAYER MAY RECEIVE ONLY ONE26
TAX CREDIT CERTIFICATE PER INCOME TAX YEAR .27
1249
-5- (b) (I) THE DEPARTMENT OF AGRICULTURE SHALL MAINTAIN A1
DATABASE OF ANY INFORMATION DETERMINED NECESSARY BY THE2
DEPARTMENT OF AGRICULTURE TO EVALUATE THE EFFECTIVENESS OF THE3
INCOME TAX CREDIT ALLOWED IN THIS SECTION IN MEETING THE PURPOSE4
SET FORTH IN SUBSECTION (1) OF THIS SECTION AND SHALL PROVIDE SUCH5
INFORMATION, AND ANY OTHER INFORMATION THAT MAY BE NEEDED , IF6
AVAILABLE, TO THE STATE AUDITOR AS PART OF THE STATE AUDITOR 'S7
EVALUATION OF THIS TAX EXPENDITURE REQUIRED BY SECTION 39-21-305.8
(II) T
HE DEPARTMENT OF AGRICULTURE SHALL , IN A SUFFICIENTLY9
TIMELY MANNER TO ALLOW THE DEPARTMENT OF REVENUE TO PROCESS10
RETURNS CLAIMING THE INCOME TAX CREDIT ALLOWED IN THIS SECTION ,11
PROVIDE THE DEPARTMENT OF REVENUE WITH AN ELECTRONIC REPORT FOR12
THE PRECEDING TAX YEAR THAT LISTS EACH QUALIFIED TAXPAYER TO13
WHICH THE DEPARTMENT OF AGRICULTURE ISSUED A TAX CREDIT14
CERTIFICATE AND INCLUDES THE FOLLOWING INFORMATION :15
(A) T
HE QUALIFIED TAXPAYER'S NAME;16
(B) T
HE AMOUNT OF THE INCOME TAX CREDIT THAT THE17
CERTIFICATE INDICATES THE QUALIFIED TAXPAYER IS ELIGIBLE TO CLAIM ;18
AND19
(C) T
HE QUALIFIED TAXPAYER'S SOCIAL SECURITY NUMBER OR THE20
QUALIFIED TAXPAYER'S COLORADO ACCOUNT NUMBER AND FEDERAL21
EMPLOYER IDENTIFICATION NUMBER .22
(5) I
N ORDER TO CLAIM THE CREDIT AUTHORIZED BY THIS SECTION ,23
A QUALIFIED TAXPAYER SHALL FILE THE TAX CREDIT CERTIFICATE WITH24
THE QUALIFIED TAXPAYER'S STATE INCOME TAX RETURN. THE AMOUNT OF25
THE CREDIT THAT THE QUALIFIED TAXPAYER MAY CLAIM PURSUANT TO26
THIS SECTION IS THE AMOUNT STATED ON THE TAX CREDIT CERTIFICATE .27
1249
-6- (6) THE DEPARTMENT OF AGRICULTURE SHALL ISSUE CERTIFICATES1
FOR CREDIT CLAIMS RECEIVED IN THE ORDER SUBMITTED , BUT SHALL NOT2
ISSUE CREDIT CERTIFICATES THAT EXCEED THREE MILLION DOLLARS IN A3
CALENDAR YEAR. AFTER CERTIFICATES HAVE BEEN ISSUED FOR CREDITS4
IN AN AGGREGATE AMOUNT OF THREE MILLION DOLLARS FOR ALL5
QUALIFIED TAXPAYERS DURING A CALENDAR YEAR , ANY ADDITIONAL6
CLAIMS MUST BE PLACED ON A WAIT LIST, WITH PRIORITY FIRST GIVEN TO7
A QUALIFIED TAXPAYER WHO HAS BEEN ISSUED A TAX CERTIFICATE IN THE8
CALENDAR YEAR PRECEDING THE CALE NDAR YEAR IN WHICH THE9
QUALIFIED TAXPAYER IS PLACED ON THE WAIT LIST AND SECOND TO A10
QUALIFIED TAXPAYER WHO APPLIED FOR THE TAX CREDIT AUTHORIZED IN11
THIS SECTION BUT WAS PLACED ON THE WAIT LIST , AND A CERTIFICATE12
MUST BE ISSUED FOR USE OF THE CREDIT IN THE NEXT CALENDAR YEAR ;13
EXCEPT THAT NO MORE THAN TWO MILLION DOLLARS IN CLAIMS SHALL BE14
PLACED ON THE WAIT LIST IN ANY GIVEN CALENDAR YEAR . NO CLAIM FOR15
A CREDIT IS ALLOWED FOR ANY INCOME TAX YEAR UNLESS A CERTIFICATE16
HAS BEEN ISSUED BY THE DIVISION. IF ALL OTHER REQUIREMENTS OF THIS17
SECTION ARE MET, THE RIGHT TO CLAIM THE CREDIT IS VESTED IN A18
QUALIFIED TAXPAYER AT THE TIME A CREDIT CERTIFICATE IS ISSUED .19
(7) I
F AN INCOME TAX CREDIT AUTHORIZED IN THIS SECTION20
EXCEEDS THE INCOME TAX DUE ON THE INCOME OF THE QUALIFIED21
TAXPAYER FOR THE TAXABLE YEAR , THE EXCESS CREDIT MAY NOT BE22
CARRIED FORWARD AND MUST BE REF UNDED TO THE QUALIFIED23
TAXPAYER.24 (8) THE COMMISSIONER OF THE DEPARTMENT OF AGRICULTURE25
MAY ISSUE RULES TO ADMINISTER THIS SECTION, INCLUDING SPECIFYING26
REQUIREMENTS FOR IMPLEMENTING AND DEMONSTRATING QUALIFIED27
1249
-7- STEWARDSHIP PRACTICES, AND MAY ISSUE TAX CREDIT CERTIFICATES1
PURSUANT TO THIS SECTION. BEFORE PROMULGATING ANY RULES, THE2
COMMISSIONER SHALL INITIATE A PUBLIC STAKEHOLDER PROCESS TO3
ADVISE THE COMMISSIONER ABOUT THE REQUIREMENTS FOR4
IMPLEMENTING AND DEMONSTRATING QUALIFIED STEWARDSHIP5
PRACTICES.6
(9) THIS SECTION IS REPEALED, EFFECTIVE DECEMBER 31, 2034.7
SECTION 2. Appropriation. For the 2024-25 state fiscal year,8
$17,117 is appropriated to the department of agriculture for use by the9
agricultural services division. This appropriation is from the general fund10
and is based on an assumption that the division will require an additional11
0.1 FTE. To implement this act, the division may use this appropriation12
for the conservation services division.13
SECTION 3. Act subject to petition - effective date. This act14
takes effect at 12:01 a.m. on the day following the expiration of the15
ninety-day period after final adjournment of the general assembly; except16
that, if a referendum petition is filed pursuant to section 1 (3) of article V17
of the state constitution against this act or an item, section, or part of this18
act within such period, then the act, item, section, or part will not take19
effect unless approved by the people at the general election to be held in20
November 2024 and, in such case, will take effect on the date of the21
official declaration of the vote thereon by the governor.22
1249
-8-