David Ortiz
- Democratic
- Representative
- District 38
Primary
The 2017 federal "Tax Cuts and Jobs Act" placed a cap of $10,000 on the amount of state and local taxes paid that an individual can deduct on their federal taxes. This limitation did not apply to C corporations. Consequently, businesses organized as pass-through entities like S corporations and partnerships pay increased taxes on business profits compared to C corporations because pass-through entities pay taxes on business profits at the individual (partner or shareholder) level.For income tax years commencing on or after January 1, 2022, the act allows pass-through entities to elect to pay their state income tax at the entity level so that the pass-through entity can claim an unlimited deduction at the federal level of state and local taxes paid; except that the election is only allowed in an income tax year where there is a limitation on the deductions allowed to individuals under section 164 of the internal revenue code.While this reduces federal taxable income for the pass-through entity, it does not reduce Colorado taxable income because, under current law, the individual and the partnership are required to add back any state and local taxes deducted at the federal level.The act adds an appropriation for the department of revenue to implement the taxpayer's election to pay their state income tax at the entity level.(Note: This summary applies to this bill as enacted.)
Governor Signed
Sent to the Governor
Signed by the Speaker of the House
Signed by the President of the Senate
Senate Third Reading Passed - No Amendments
Senate Second Reading Special Order - Passed - No Amendments
Senate Committee on Appropriations Refer Unamended - Consent Calendar to Senate Committee of the Whole
Senate Committee on State, Veterans, & Military Affairs Refer Unamended to Appropriations
Introduced In Senate - Assigned to State, Veterans, & Military Affairs
House Third Reading Passed - No Amendments
House Second Reading Passed with Amendments - Committee
House Committee on Appropriations Refer Amended to House Committee of the Whole
House Committee on Finance Refer Unamended to Appropriations
| Bill Text Versions | Format |
|---|---|
| Signed Act (06/23/2021) | |
| Final Act (06/22/2021) | |
| Rerevised (06/08/2021) | |
| Revised (06/07/2021) | |
| Reengrossed (06/07/2021) | |
| Engrossed (06/04/2021) | |
| Introduced (06/01/2021) | |
| PA1 (06/04/2021) | |
| Committee Amendment |
| Document | Format |
|---|---|
| Fiscal Note SA1 (06/03/2021) | |
| Fiscal Note FN1 (06/02/2021) | |
| Fiscal Note FN2 (06/03/2021) | |
| Fiscal Note FN3 (07/23/2021) |
Data on Open States is updated periodically throughout the day from the official website of the Colorado General Assembly.
If you notice any inconsistencies with these official sources, feel free to file an issue.