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.
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.
Does a charitable donation from a DAF (donor advised fund) qualify for Colorado child care tax credit with Form DR1317?
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,
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.
You should find the credit under Colorado credits and taxes:
I don't see under Turbo Tax where I may electronically upload form DR1317 to my State return, assistance please
On the screen in the Colorado interview titled, "Enter Your Child Care Contribution Credit", There is a link at the bottom: "How do I do this?". When you expand the link, you will see a box that explains how your send form DR 1317 to the state even if you e-filed.
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?
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!
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?
You are correct, TurboTax is applying 100% instead of 50%. Thank you for bringing this to our attention; we will get this updated. You can either reduce it by half or wait for the update. You may want to wait, since manually adjusting it will require you to enter a different amount (1/2) than reported on your DR1317 @izzyp1
Is there an ETA for this fix for Colorado( TurboTax is applying 100% instead of 50% )?
Take a look at the following TurboTax help article and click the link to register your email address for notifications as this situation is addressed:
Why is the Colorado Child Care Contribution Credit not calculating 50%?
When you I click on the link given, I get
Can you double check link.
thanks,
When there is an issue being addressed by the developers and there is an article issued to allow you to register your email address, the link is discontinued when the issue is completed.
When entering the information for the Colorado Child Care Credit Contribution, be sure to look at your Colorado Form DR 1317 and enter the amount shown on line 3 to claim the credit.
The credit is still be miscalculated at 100% of donation instead 50%. Enter the donation amount from line 3 will give you an incorrect deduction (double). Is TurboTax working this problem?
thanks,
Yes, this does seem to be an ongoing issue. Need your help so we can resubmit to the investigations team. Here is where I need your help.
If you are using the software version, check the Online tab in the black stripe and then check for updates.
The program is working correctly. The program was updated to change the wording to say the credit amount from line 3 of Form 1317 which is already at 50%. Review the form and make sure that line 3 in Form 1317 is calculated at 50%.
Be sure to run the updates in your program as I suggested.
This is incorrect. Line 3 of the DR 1317 is the full donation amount. Line4 is the credit 50%. I have entered the line 4 (50% credit) into TurboTax. This corrects the main CO tax form and gives the correct total amount, but it does leave a incorrect value in the smart worksheet. If that causes any red flags, I guess its easy enough to explain. Not sure if the worksheet is sent in with e-file or not.
thanks
No, worksheets are not part of your tax return. Only IRS forms create the return that is sent to the IRS.