Colorado Gov. Jared Polis recently signed a landmark bill to make higher education more accessible in the Centennial State. Proponents say the new law, the Colorado Promise: Two Free Years of College Expanded, will help reduce financial barriers for many students and families.
In a release, Polis pointed out that under Colorado Promise, any public four-year college, community college, or trade school will be free for more Coloradans.
“This will strengthen Colorado’s workforce, provide new pathways for students to gain in-demand skills, and save Coloradans thousands of dollars — helping ensure that higher education is affordable for everyone,” Polis stated.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The initiative, which starts this fall, is designed to help more students from families with lower and middle incomes pursue higher education without the burden of significant debt.
Here’s more of what you need to know.
Is college tuition free in Colorado?
The Colorado Promise program will offer two years of tuition and fees at any public four-year college, community college, or trade school in Colorado for students whose families earn less than $90,000 annually.
According to the Colorado Department of Education website, “the tax credit covers up to the first 65 credits a student takes, not counting any concurrent enrollment, AP/IB, military credit, or credit for prior learning.”
- To be eligible for this program, students must qualify for in-state tuition and complete either the Free Application for Federal Student Aid (FAFSA) or the Colorado Application for State Financial Aid (CASFA).
- Additionally, they must enroll in college within two years of graduating high school to pursue a degree and have a semester minimum 2.5 grade point average (GPA).
Qualifying students initially pay tuition out-of-pocket and the reimbursement is for tuition and fees after accounting for any scholarships or grants. However, eligible students can claim reimbursement during tax season through a refundable income tax credit.
- For example, students starting their education in the fall of 2024 will claim their tax credit on their 2025 returns, filed in early 2026.
- That means families cover tuition upfront, with reimbursement following the subsequent tax year.
The lag between paying tuition and receiving the tax credit could be challenging for some. Still, long-term benefits of reducing student debt and enhancing access to education are potentially substantial.
Note: According to state officials, the program specifics may vary depending on the requirements of each educational institution.
TABOR Colorado
Funding for the free tuition initiative involves reallocating state tax revenues to fund the educational costs for eligible students. The program leverages funds collected above the Taxpayer’s Bill of Rights (TABOR) cap. (TABOR requires that excess revenue be returned to Colorado taxpayers.)
TABOR payments/refunds are based on whether the state exceeds a surplus revenue threshold. For example, as Kiplinger has reported, 2024 TABOR payments will be flat or equal across the board. Current estimates are that single filers could receive about $847 and joint filers, $1,694.
Other Colorado tax relief
In addition to the Colorado Promise initiative, Gov. Polis recently signed other tax bills designed to support families and improve economic conditions. Meanwhile, Coloradans will also have the opportunity to vote on property tax proposals in November.
Two proposed property tax measures on the state ballot would provide tax relief to homeowners facing soaring property values.
Related
-
How to Organize Your Financial Life (and Paperwork)To simplify the future for yourself and your heirs, put a financial contingency plan in place. The peace of mind you'll get is well worth the effort.
-
Financial Confidence? It's Just Good Planning, Boomers SayBaby Boomers may have hit the jackpot money-wise, but many attribute their wealth to financial planning and professional advice rather than good timing.
-
IRS Free File Is Now Open for 2025: Are Your Taxes Eligible?Tax Filing Official tax season doesn't begin until late January, but taxpayers can start filing free online returns now.
-
California Fires: How to Recover Tax Records and Other Important DocumentsDisaster Recovery Having your tax records and other vital documents is important for claiming casualty loss deductions that can help with recovery.
-
Child and Dependent Care Credit: How Much Is It?CDCTC The non-refundable tax break can help working families afford quality care for their child or qualifying dependent.
-
Gov. Hochul Wants to Triple the New York Child Tax CreditState Tax Millions of New York families could get a larger state child tax credit check over the next two years under a new proposal.
-
U.S. Consumers May Feel Pinch From Panama Canal Tariff HikeTax Policy The Panama Canal tariffs on crossing ships will add to looming price hikes for U.S. consumers as Trump threatens to take control of the historic waterway.
-
The American Opportunity Tax Credit (AOTC): How Much Is It Worth?Tax Credits This tax break can help you offset $2,500 in qualifying expenses tied to your higher education. Here's what you need to know.
-
Does Your State Have a Child and Dependent Care Tax Credit?
Child and Dependent Care Tax Credit Over two dozen states, plus the District of Columbia offer tax credits or deductions for working families.
-
Should Rent Be Part of Your Retirement Plans?Retirement Taxes Retiree renters may qualify for potential tax savings. Are you considering a move?
