Colorado § 39-22-5404 - Qualified development owned by governmental or quasi-governmental entity.

§ 39-22-5404. Qualified development owned by governmental or quasi-governmental entity.

(1) Notwithstanding any other provision of this part 54:

(a) The authority may allocate credits to any governmental or quasi-governmental entity, including the middle-income housing authority created in section 29-4-1104, with respect to a qualified development that is owned by such entity.

(b) [Editor's note: This version of subsection (1)(b) is effective until January 1, 2027.]

(I) A governmental or quasi-governmental entity may transfer credits allocated to it by the authority to any qualified taxpayer.

(II) Such a governmental or quasi-governmental entity shall invest in the qualified development any compensation received in connection with a transfer of credits to a qualified taxpayer.

(III) A qualified taxpayer to which a credit is transferred pursuant to this subsection (1)(b) is entitled to claim the credit in the same manner and subject to the same conditions and allocation rights as an owner of a qualified development to which the authority has allocated a credit.

(b) [Editor's note: This version of subsection (1)(b) is effective January 1, 2027.]

(I) A governmental or quasi-governmental entity may transfer credits allocated to it by the authority to a transferee.

(II) Such a governmental or quasi-governmental entity shall invest in the qualified development any compensation received in connection with a transfer of credits to a transferee.

(III) A transferee to which a credit is transferred pursuant to this subsection (1)(b) is entitled to claim the credit in the same manner and subject to the same conditions and allocation rights as an owner of a qualified development to which the authority has allocated a credit.

(c) [Editor's note: This version of subsection (1)(c) is effective until January 1, 2027.]

(I) A credit allocated to a governmental or quasi-governmental entity or a transferee thereof is subject to recapture pursuant to section 39-22-5405.

(II) If a credit transferred to a qualified taxpayer by a governmental or quasi-governmental entity is recaptured pursuant to section 39-22-5405, the governmental or quasi-governmental entity shall notify the department of the identity of the qualified taxpayer to which it transferred a credit.

(c) [Editor's note: This version of subsection (1)(c) is effective January 1, 2027.]

(I) A credit allocated to a governmental or quasi-governmental entity or a transferee thereof is subject to recapture if, as of the last day of any taxable year during the compliance period, the amount of the qualified basis of such governmental or quasi-governmental entity is less than the amount of the qualified basis with respect to such governmental or quasi-governmental entity as of the last day of the prior taxable year.

(II) If a credit transferred to a transferee by a governmental or quasi-governmental entity is recaptured pursuant to subsection (1)(c)(I), the governmental or quasi-governmental entity shall notify the department of the identity of the transferee to which it transferred a credit and such transferee must increase their income tax liability pursuant to section 39-22-5305 in the same manner and to the same extent as a partner, shareholder, member, or other qualified taxpayer of an owner allocated a credit pursuant to section 39-22-5403 (6) must increase their income tax liability pursuant to section 39-22-5405.

Source: L. 2024: Entire part added, (HB 24-1316), ch. 287, p. 1923, § 1, effective May 30. L. 2026: (1)(b) and (1)(c) amended, (SB 26-001), ch. 7, p. 22, § 7, effective January 1, 2027.