MJP –
Exciting news for Colorado residents: tax refunds will be making their way to you once again in 2025, all thanks to the Taxpayer’s Bill of Rights, commonly known as TABOR.
Recently, it was revealed by the Coloradoan that the state has collected an impressive $1.4 billion more in revenue than what is permissible under TABOR regulations. Alongside this, the state is also set to refund an additional $289 million that was previously underfunded.
If you’re curious about how much you’ll receive from the TABOR Refunds in 2025 and the timeline for these payments, stay informed with the latest updates. While the refunds are anticipated to be distributed in 2025 for the 2023-24 fiscal year, it’s important to note that future state budgets might be tighter, making refunds beyond this period uncertain.
Many are wondering, “How will I get my TABOR refund? Will it come in the form of a check?” In the fall of 2022, Colorado issued refunds via checks, but that was a unique occurrence. According to Maya Rosochacova, an audit manager, there are three methods through which these refunds will be returned to taxpayers:
- Direct Deposits to Bank Accounts
- Paper Checks
- Prepaid Debit Cards
The reimbursement of local governments for property tax exemptions is a significant initiative aimed at providing financial relief to specific groups, including older adults, veterans with disabilities, and Gold Star spouses. This thoughtful measure ensures that those who have served or are in vulnerable positions receive the support they deserve.
Temporary Income Tax Rate Reduction
Florida Homeowners Hit Hard: Property Taxes Surge Alongside 50% Increase in Home Values
There is an exciting opportunity for taxpayers with a temporary reduction in the income tax rate from 4.45% to 4.25%, applicable for refunds given in 2025. This reduction is processed through the typical income tax filing procedure, offering a tangible benefit to many.
Six-Tier Sales Tax Refund Mechanism
A new six-tier sales tax refund system has been introduced, strategically designed to distribute refunds based on taxpayers’ adjusted gross income. If the refund exceeds $15 per person, it is also processed through the income tax filing system. The refund amount varies according to income, ensuring fairness and equity across different income groups.
What Refund Can You Expect?
Beyond the tax savings from the reduced income tax rate of 4.25%, taxpayers can anticipate the following refunds through the six-tier mechanism:
Adjusted Gross Income: Single Filers / Joint Filers
- Incomes up to $53,000: $177 / $354
- $53,001 to $105,000: $240 / $480
- $105,001 to $166,000: $277 / $554
- $166,001 to $233,000: $323 / $646
- $233,001 to $302,000: $350 / $700
- $302,001 and up: $565 / $1,130
These measures collectively provide substantial financial relief, ensuring that the most deserving members of our community receive the support and benefits they need.
