If you live in Colorado and pay taxes, you may already know about TABOR. But if you’re not sure what it means or how it affects you, this guide will help. TABOR stands for Taxpayer Bill of Rights. It was passed in 1992 and is a unique law that limits how much money the Colorado state government can collect and spend.
What Is TABOR and Why Was It Created?
TABOR was introduced to make sure that the government does not collect more money than necessary from taxpayers. It requires the state to return extra income (called surpluses) to residents if government revenues go over a set limit.
This limit is based on two factors: inflation and population growth each year. If income goes beyond this limit, the state must return the extra amount to taxpayers.
TABOR also requires a public vote if the government wants to increase taxes. It mainly applies in Colorado, where it still influences how the state budget is planned.
What Are the TABOR Benefits in 2025?
In 2025, the state of Colorado is giving back money to taxpayers in two ways:
1. Sales Tax Refund
2. Temporary Income Tax Rate Reduction
1. Sales Tax Refund
This refund is based on your adjusted gross income (AGI) for the 2024 tax year. The amounts are not paid as separate checks, but are included in the general state tax refund.
Here’s how much you could receive:
- Single filers: Between $177 and $565
- Married couples filing jointly: Between $354 and $1,130
To claim this, you must file a state tax return or use the PTC form if you’re a senior with low income. Refund amounts are based on six income levels, announced in April 2025.
2. Temporary Tax Rate Reduction
Colorado has reduced the state income tax rate from 4.40% to 4.25% for the 2024 tax year. This change applies automatically, so you don’t need to do anything extra to get it.
For example, someone earning $50,000 will save about $75 in 2024 because of this rate cut. People with higher incomes benefit more because their taxable income is higher.
Who Can Claim TABOR Benefits?
To qualify for TABOR refunds and tax cuts:
- You must have been a Colorado resident for the full year 2024
- You must file your state tax return by October 15, 2025
- If you’re a senior (age 65+) with non-taxable income below $25,000, you can use form DR0104EZ to claim your refund
- Seniors must also have paid at least one property, rent, or heat tax
- Couples filing jointly must be legally married as of December 31, 2024
If you miss the tax filing deadline or don’t meet the requirements, you won’t receive the refund. There are no refunds for non-residents, trusts, or people living outside Colorado unless they can prove residency.
When Will Refunds Be Sent?
Those who filed their returns early (by April 15, 2025) started receiving their refunds in May 2025. If you file later, it might take:
- 3 to 5 weeks for electronic returns
- Up to 12 weeks for paper returns
Delays can happen if there are mistakes in your forms or missing information.
Why Is the 2024 TABOR Model Different?
In 2023, TABOR refunds were the same amount for everyone. But many people complained that this was unfair because it didn’t consider how much tax people actually paid.
So, in 2024, Colorado switched to a system that uses income levels. Now, the more tax you paid, the higher your refund—making the process more fair and balanced.