Colorado’s members of Congress tell IRS not to tax TABOR

All 10 members of Colorado’s bipartisan congressional delegation sent a message to the Internal Revenue Service Friday morning: Don’t tax Coloradans’ refund checks.

The IRS issued guidance last week telling Coloradans to delay filing their taxes if they received a special refund last year. About 2.4 million refund checks were sent to Coloradans late last summer to refund taxes collected over the limit set by the Taxpayer Bill of Rights, or TABOR.

TABOR has been part of Colorado’s Constitution for 30 years. While the checks were a new delivery method for the refunds, refunds themselves have been a regular — untaxed by the IRS — occurrence in the state.

“It is incomprehensible that the IRS would threaten to take money out of the hands of hardworking Coloradans,” U.S. Rep. Joe Neguse, a Democrat from Lafayette who previously served as director of Colorado’s regulatory agency, said in a statement. Neguse organized the bipartisan letter.

In the letter, Colorado’s federal delegation warned that suddenly taxing the refunds “would impose a significant burden on Colorado taxpayers, introduce considerable compliance costs for taxpayers who did not anticipate having to add their TABOR revenue payments to their joint or single filings, and cost Coloradans hundreds of additional dollars in tax liability.”

Further, they noted concern that the IRS’ announcement during tax season creates “unnecessary stress” for Coloradans.

“As you know, regulatory stability and transparency promote compliance, whereas sudden changes with thin justification do not,” the letter states. “Potential new rules promulgated within months of the filing deadline, with the possibility of costing taxpayers a significant amount of money, would impose unnecessary financial distress on countless Coloradans.”

In addition to Neguse, it was signed by U.S. Sens. Michael Bennet and John Hickenlooper, both Democrats, and Reps. Lauren Boebert, Ken Buck, Yadira Caraveo, Jason Crow, Diana DeGette, Doug Lamborn, and Brittany Pettersen.

“The IRS owes Coloradans a timely answer surrounding this uncertainty and a justification for this potentially costly policy reversal,” Buck, a Windsor Republican, said in a statement.

The IRS said in an unsigned statement last week it expected to provide additional guidance this week. Its media office did not immediately return a request for comment Friday.

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