Child Care Contribution Tax Credit

The Colorado Child Care Contribution Credit was established to encourage greater private support of Colorado child care programs. This generous 50% tax credit is available to businesses and individuals who make a monetary donation in support of child care.

This means that your cash contribution to Qualistar Early Learning will allow you a tax credit on your state tax bill equal to 50% of your donation. Combined with the federal tax deduction for charitable contributions this can substantially reduce your tax bill while working to increase child care program quality and affordability in Colorado.

As always, you should consult with your tax advisor to determine how the credit will affect you personally.

Tax Saving Example
(Illustration – please consult with your tax advisor)

Federal Income Tax Bracket28%33%35%
Contribution$1,000$1,000$1,000
Colorado Child Care Credit($500)($500)($500)
Charitable Deduction Colorado Tax Savings($46.30)($46.30)($46.30)
Charitable Deduction Federal Tax Savings($280)($330)($250)
Related Federal Tax Effect*$152.96$180.28$191.21
After Tax Costs of Gift to Qualistar$326.66$303.98$294.91
Total Tax Saving$673.34$696.02$705.10

*Lower state income taxes mean lower state tax deductions for federal tax purposes.

Guidelines

  • The maximum credit you may take in any one year is $100,000 or your actual Colorado income tax liability for the year, whichever is less. However, any unused credit may be carried forward for up to five additional tax years.

  • Only monetary donations are eligible. In-kind gifts, such as stocks or other securities, labor, or equipment no longer qualify for the tax credit.

  • Contributions for which an Enterprise Zone Credit is taken are not eligible for this credit.

  • As required by law, Qualistar Early Learning will provide each donor with a signed statement confirming the amount of the monetary contribution eligible for the credit and the eligible purpose for which the contribution will be used.

  • The credit is available for contributions made through December 31, 2009.

For more information, please call Deidre Johnson at 303.339.6813.