Colorado Child Care Tax Credit

Make your Charitable Dollar go Further

Charitable contributions to Big Brothers Big Sisters of Southwest Colorado, Inc. (“BBBS”) qualify for the Child Care Contribution Tax Credit (“CCCTC”). The CCCTC provides a valuable credit against a taxpayer’s Colorado state income tax. The credit equals 50% of the amount of a direct donation made to a qualifying Colorado charitable organization that promotes childcare. A taxpayer (or two taxpayers filing jointly) can claim a credit of up to $100,000 per year. Resident and nonresident individuals, estates, trusts, and C corporations can all claim the credit for qualifying contributions they make, either directly or as a partner or a shareholder in a partnership or S corporation that makes a qualifying contribution. Taxpayers can carry forward excess credits for five years. In addition, the contribution is also deductible from state income taxes; and the portion of the charitable contribution that is not credited back to the taxpayer is deductible from federal income taxes. 

Examples: A contribution to BBBS by a taxpayer in the 24% federal marginal tax bracket who itemizes deductions and who has reached the $10,000 threshold on deductible state and local taxes, will result in the following tax savings, and the following net cost of the charitable contribution to the taxpayer:

Note – This explanation of the CCCTC is not legal advice and is not a substitute for professional tax, legal, or accounting counsel. The example above is only a hypothetical example. The tax consequences of your donation to BBBS will vary based on your individual circumstances.