For any tax year beginning on or after January 1, 2000, but prior to December 31, 2010, an income tax credit is available for taxpayers who redevelop contaminated land in Colorado. [§39-22-526, C.R.S.].
The property being redeveloped must be located within a municipality that has a population of 10,000 or more and the project must be approved by the Colorado Department of Public Health and Environment (CDPHE). A certificate from CDPHE verifying that the project qualifies for this credit and the implementation costs must be attached to any income tax return that claims this credit. To obtain the certificate, the property must go through the “Voluntary Clean Up Program.” For more information, visit the CDPHE Web site at www.cdphe.state.co.us
Computing the credit The credit will be the total of the following:
1. 50% of the first $100,000 expended for the project,
2. 30% of the amount expended over $100,000 up to $200,000,
3. 20% of the amount expended over $200,000 up to $300,000
A tax credit is not allowed on expenses in excess of $300,000.
Limitations To the extent the allowable credit exceeds the net tax liability, the excess may be carried forward for up to five years.