Colorado is expected to refund taxpayers under the state’s Taxpayer Bill of Rights (TABOR) law. The law mandates the state to refund excess revenue back to taxpayers in case certain revenue thresholds are exceeded.
This article will discuss who is eligible for these refunds, how the payments will be made, and by when the refunds are supposed to be issued.
TABOR in Colorado requires that if the state government earns revenue that surpasses the limit, it should refund excess revenue back to taxpayers. It is expected that in 2025 there will be TABOR refunds from the state owing to its exceeding revenue limits.
Who will benefit from TABOR Refunds:
All taxpayers of the state of Colorado who paid income taxes within Colorado for the year in which the excess revenue was realized qualify for refunds under TABOR. This comprises individuals and business entities among others that paid state income taxes.
Payment Information:
The amount of the TABOR refund will vary depending on the excess revenue collected by the state government and on the total amount of income taxes paid by individual taxpayers.
Usually, the refund is processed as a credit on the succeeding year’s tax return, which either reduces the amount owed or increases the amount refunded to the taxpayer.
The duration of the issuance of TABOR refunds can vary between the time when excess revenue is collected up to the processing and distribution of refunds by the state government. In most cases, there will be instances whereby refunds are issued shortly after the fiscal year ends.
Only the residents, part-year residents, and other non-residents who paid Colorado state income tax for the respective tax year qualify to receive a TABOR refund. These people have their respective income and earned within Colorado.
These people must have overpaid their state income tax whereby more revenue was collected than the one that is allowed under the Taxpayer’s Bill of Rights (TABOR). This excess revenue collected triggers the refunds
The amounts of the TABOR refund received by qualified persons shall be determined on the basis of the amount of excess state revenue collected during the tax year for which such refund is being paid. Such refund shall be computed using each taxpayer’s percentage interest in the excess revenue as determined by the Colorado Department of Revenue.
The TABOR refunds will appear to a taxpayer as a credit on his state income tax return for the year in which the refunds are distributed. A taxpayer would see the refund appearing in his tax return and could either receive a larger refund or pay less in taxes, depending on one’s situation.
The Colorado Department of Revenue shall determine the amount of excess revenue collected during the applicable tax year and calculate the TABOR refunds payable to such eligible persons. The refunds shall be allowed as credits on state income tax returns of taxpayers for that year.
When the Department of Revenue will actually distribute the TABOR refunds is up to when it finishes its calculations and when it distributes them.
Taxpayers should be watching for information from the Department of Revenue and consulting with a tax professional about even more tailored information about when they could expect their TABOR refund.
Summary In essence, TABOR refunds shall therefore be a return to excess state revenue paid to all taxpayers in Colorado, and hence, individuals and businesses qualified to acquire their refunds shall get them in good time without having to apply for them first.
Accredited individuals: Colorado residents who filed a state income tax return in the past year and have a tax liability
The refund amount primarily depends on the revenue and expenditure levels of the state, but is estimated at a rough $100-$200 per person.
Method of payment: Refund will be made directly into one’s account or by check:
- Timing: Reimbursements would be returned this fall of 2025, once the state has reconciled its fiscal year revenues and expenses and determined how much excess revenue exists.
Eligibility Determination: The state government determines the total amount that is available for the TABOR refunds and who qualifies in case of excess funds.
Distribution Plan: The state government shall draw up a distribution plan detailing the eligibility criteria and the refund amount to each eligible taxpayer.
Notice: The state government will give notice to eligible taxpayers of their entitlement to TABOR refund and the amount they’ll collect.
Disbursement: Eligible taxpayers can either have their TABOR refund paid into their account directly or by check. Be sure that your information is current with the Colorado Department of Revenue.
Deadline: There will also be a deadline for claiming your TABOR refund. Be sure to follow instructions furnished by the state government in successfully claiming your refund.
Tips for Maximizing Your TABOR Refund:
Who can be eligible for Colorado’s 2025 TABOR Refunds?
- Individuals who paid state income taxes in 2025
- Person eligible to the state for his or her gross income.
- Those persons who have also taken tax and have no pending state debt.
Amount and Payment:
The refund amount shall be arrived at by means of a formula taking into account the state’s revenue collection and population growth.
- The refund is typically made either by direct deposit or check sent by mail
- The typical return is around $100 to $200 per eligible individual
Timeline:
- TABOR refunds typically are issued in the fall of the year after the tax year
- For tax year 2025, the refunds will probably be issued in late 2026
Tips for Getting the Most Out of Your TABOR Refund
- File state taxes in a timely and proper manner for increased likelihood of a refund
- Consider contributing to tax advantaged accounts, such as a 401(k) or IRA, which decreases the amount of taxable income and thus increases the refund amount
- Keep records of deductible expenses-they are interest paid on a mortgage as well as donations you made to charities and medical expenditures.
Celebrating Your TABOR Refund:
If one is a Colorado resident and has paid state income taxes, among other specific eligibility criteria under TABOR, the state will mail a refund check in 2025. The amount of refund dollars depends on state revenues and spending for the year.
Who is Eligible:
Colorado residents who paid state income taxes for the previous year
Eligible individuals meet certain requirements for income and residency.
- Taxpayers who owe no unpaid state debt or tax
Payment Information:
- The amount of money refunded will depend on what the state collects and spends over the course of the year
- The refunds will be issued to eligible taxpayers through check or direct deposit
- Funds should be paid out separately from the tax refund or credits currently due to taxpayers
- Total amount of refund will be published by the Colorado Department of Revenue at the beginning of 2025
- Eligible taxpayers in the state are expected to get their refunds by the end of 2025
- Therefore, the timeline of refunds will, on the contrary, depend on the revenue and expenditure of the state within any year
Celebrate Your TABOR Refund:
- When you receive your refund from TABOR, celebrate responsibly
- Save or invest refund so that you are prepared for the future
Share the news with friends and family who might also qualify for a refund.
In general, Colorado residents should look out for public notices by the Department of Revenue on the potential refund eligibility and administration of their TABOR refund in 2025.
Conclusion:
For these reasons, the 2025 TABOR refunds in Colorado will be an excellent distribution of finances for taxpayers who benefit from the refund. Considering how much is earned and paid by a person in property tax, the refund is sure to be a sizeable amount of money.
However, refunds will be paid in two installments-the first payment is scheduled for October 2025, while the second payment is set for January 2026. Eligible taxpayers should stay informed regarding their refund and have a chance to claim their money.
Generally, TABOR refunds give Coloradoans an opportunity to enjoy financial returns on the surplus revenue.