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How do I use the Colorado child care credit contribution?

Forum|Forum|6 years ago
June 4, 2019
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Best answer by JulieH1

Taxpayers that make a qualifying monetary contribution to promote child care in Colorado may claim an income tax credit of 50% of the total qualifying contribution. In-kind contributions of property (non-monetary donations) do not qualify for the credit.

TAXPAYERS ELIGIBLE FOR THE CREDIT Any taxpayer that makes a qualifying contribution can claim the child care contribution credit. Resident and nonresident individuals, estates, trusts, partnerships, and corporations can all claim the credit for qualifying contributions they make.

QUALIFYING CONTRIBUTIONS Contributions must meet several criteria to qualify for the child care contribution credit. The contribution must be monetary; contributions of property do not qualify for the credit. The credit is allowed only for contributions that promote child care in Colorado. Additionally, the contribution must be made for an eligible child care purpose and to a licensed child care facility, an approved facility school, or a registered or grandfathered child care program.

HOW TO CLAIM THE CREDIT

Taxpayers must file an annual income tax return along with the associated credit schedule in order to claim the credit. Taxpayer must submit with their return a copy of the completed Child Care Contribution Tax Credit Certification (Form DR 1317) obtained from the donee organization certifying the contribution. For electronically filed returns, a scanned copy of Form DR 1317 can be submitted either via e-file or by using the E-Filer Attachment function of Revenue Online. TurboTax will produce this form for you to upload or mail with your receipt.

For more information:

https://www.colorado.gov/pacific/sites/default/files/Income35.pdf.

J

JulieH1Answer

Taxpayers that make a qualifying monetary contribution to promote child care in Colorado may claim an income tax credit of 50% of the total qualifying contribution. In-kind contributions of property (non-monetary donations) do not qualify for the credit.

TAXPAYERS ELIGIBLE FOR THE CREDIT Any taxpayer that makes a qualifying contribution can claim the child care contribution credit. Resident and nonresident individuals, estates, trusts, partnerships, and corporations can all claim the credit for qualifying contributions they make.

QUALIFYING CONTRIBUTIONS Contributions must meet several criteria to qualify for the child care contribution credit. The contribution must be monetary; contributions of property do not qualify for the credit. The credit is allowed only for contributions that promote child care in Colorado. Additionally, the contribution must be made for an eligible child care purpose and to a licensed child care facility, an approved facility school, or a registered or grandfathered child care program.

HOW TO CLAIM THE CREDIT

Taxpayers must file an annual income tax return along with the associated credit schedule in order to claim the credit. Taxpayer must submit with their return a copy of the completed Child Care Contribution Tax Credit Certification (Form DR 1317) obtained from the donee organization certifying the contribution. For electronically filed returns, a scanned copy of Form DR 1317 can be submitted either via e-file or by using the E-Filer Attachment function of Revenue Online. TurboTax will produce this form for you to upload or mail with your receipt.

For more information:

https://www.colorado.gov/pacific/sites/default/files/Income35.pdf.

A

amdorn

I am not seeing where to enter a child care contribution credit in the State tax section. Which page should I find this on? Is it "Additional Qualifying Charitable Contributions"? It doesn't say anything about a tax credit in this section.

J

JeffreyR77

You should find the credit under Colorado credits and taxes:

P

PFM3

Does a charitable donation from a DAF (donor advised fund) qualify for Colorado child care tax credit with Form DR1317?

M

MAK70

No, contribution from a donor advised fund would not qualify on your personal tax return if you received a tax benefit (charitable deduction) for the contribution to the fund and it would be the Fund, not you personally making the donation,

@PFM3

H

hunter4770

I have already determined I can take the Child Care Contribution Tax credit for Colorado. And I have entered this into the correct section of the Colorado Tax form in TurboTax. Do I need to manually reduce the charitable donation on the Federal side by 50%? Or will this be reconciled next year when I get the 1099G form from Colorado? Or does TurboTax take this into account in the calculations once I enter the value in on the State form?

B

BillM223

You are correct that you will need to reduce the amount on your federal tax return on Schedule A for the Child Care Contribution by 50%. Note that there are a number of exceptions - Please see this Treasury page on the subject.

As a general rule, TurboTax does not make modifications to the federal return based on state calculations.

Good catch!

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I

izzyp1

The TurboTax form "learn more" link correctly states

Taxpayers who make qualifying monetary contributions to promote child care in Colorado may claim a credit of 50% of the total qualifying contribution.

and then further states

We will calculate the correct amount for you.

However, after filling in the filling in the field "2023 Qualifying Donation Amount from DR 1317", the credit amount is calculated at 100% of the qualifying donation amount rather than 50%. This seems to be incorrect, even though TurboTax insists that it will calculate the correct amount. I guess I should manually reduce the amount myself? Or does TurboTax end up taking care of this at some point down the line?

M

mglauner

On Colorado Form DR-1317, your donation amount should be shown on Line 2, then multiply that amount by .50 for the amount on Line 3. If Line 3 is incorrect, enter the correct amount in TurboTax or ask the donee for a corrected form.

Enter the amount from Line 3 in TurboTax in the Colorado Interview, on the screen titled 'Child Care Contribution Credit'.

@RZ12