While much attention is dedicated to proposals to increase federal taxation, it is important for Colorado residents (and those filing Colorado state tax returns) to understand tax law changes already on the books – fully passed and signed by the governor of Colorado in 2021 – that will apply in 2022 and going forward.
The new Colorado state tax law bills, HB 1311, and HB 1312, signed into law in June 2021, will undoubtedly impact clients submitting Colorado state tax returns in 2022 and beyond.
Impact of these bills (see table below for additional details):
- Amount of Itemized Deductions you can apply to your Colorado State Income Tax Return
- Amount of Pass-Through Deductions business owners can apply to their Colorado State Income Tax Return
- A limit on deductions for 529 Plan Contributions
- The elimination of Qualified Capital Gain Exclusions (for all but Agricultural Property)
- The elimination of State Taxes on Social Security Income
Colorado’s New Tax Laws (signed into law June 2021)
This alert is not meant to be a detailed explanation or analysis of these tax law changes impacting our Colorado clients and friends, but rather a quick notice and summary.
Tax planning involving each state a client files tax returns in, and especially, the official state of residency of each client, continues to play a more significant role in advanced tax planning. Be sure to review these items (and other state tax laws) with us, your tax preparer, your CPA, and your income and estate tax attorneys periodically to make informed decisions about such matters.
Not engaging in smart tax planning, on both a federal and state level, is a common wealth management mistake to be aware of and avoid. The Complete Wealth Solution™ of Janiczek Wealth Management includes increased amounts of integrated tax planning, analysis, and management. Important Reminder: Clients are encouraged to securely send us, via the Janiczek Sharefile Portal, a copy of their filed tax returns each year to assist us in our analysis, and integrated planning in collaboration with all your trusted advisors (tax preparer, CPA, attorneys, etc.).
If you are interested in learning more about our wealth, tax and investment management services, contact Cathy Wegner at 303-339-4480 or cwegner@janiczek.com.
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