Home Modification Tax Credit

Home and ramp

The Income Tax Credit for Retrofitting Home for Health bill (HB18-1267) created a state income tax credit of up to$5,000 to help people with an illness, impairment or disability retrofit their residence for greater accessibility and independence. The credit is available for retrofits completed in tax years 2019 through 2023.

The Colorado Legislature recently passed clarifying legislation (HB19-1135) to make dependents and spouses eligible. It also allows for up to a $5,000 credit per person in the family with a disability.

Maximum tax credits per year are limited to $1,000,000.
 

Basic Program Eligibility Criteria


Requirements for qualified individuals
Have an illness, impairment or disability that necessitates the requested home modification, and
 
Be a state income taxpayer with an adjusted family income at or below the income limit, which is $150,000 for the 2019 income tax year.
 
Anticipate owing more in state income taxes over the next five years than the value of the work or $5,000, whichever is less.
 
If the qualified individual is not the homeowner of the residence being modified, they must have the owner’s permission to modify the residence.

* The Colorado Legislature has passed clarifying legislation (HB19-1135) to make dependents and spouses eligible, effective August 2, 2019. It also allows for up to a $5,000 credit per person in the family with a disability.
Requirements for eligible residence
The residence being modified must exist before the work begins – the work may not be completed during initial construction of the residence.
 
The residence must be currently occupied as the home of the qualified individual and the person for whom the retrofit is required.

The residence must be located in Colorado.

Requirements for modification to the residence

Retrofits (or modifications) to the residence must:

  • Be necessary to ensure the health, welfare, and safety of the qualified individual and/or their dependent(s);
  • Increase the residence’s visitability;
  • Enable greater accessibility and independence in the residence for the qualified individual and/or their dependent(s);
  • Be required due the qualified individual’s and/or their dependent(s) illness, impairment or disability;
  • Allow the qualified individual and/or their dependent(s) to age in place;
  • Meet the Division of Housing's Home Modification Construction Specifications; and 
  • Be completed in the tax year for which the qualified individual will receive the tax credit.

*Please note, durable medical equipment and other items that are not installed or affixed to the residence are not eligible modifications.

 

 

 

  Prequalification Survey


If you are experiencing difficulties submitting your PreQual Survey, please contact dola_homemodtaxcredit@state.co.us
 

Reference Material


Instructional video:
 
Modifications, adaptations, or improvements

Changes made to the residence may include, but are not limited to:

  • Installing or building ramps
  • Modifying bathrooms
  • Installing grab-bars
  • Widening doorways
  • Modifying kitchen facilities
  • Installing specialized electric and plumbing systems that are necessary to accommodate medically necessary equipment and supplies

Contact


If you have any questions, please contact us at dola_homemodtaxcredit@state.co.us or at  303-482-7670.
 
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