Colorado Removes State Income Taxes for Service Members
State Legislature Passes Bill in Overwhelming Majority
July 10, 2015 by Jake Butler
Good news for service members in Colorado! The state legislature passed a bill last month that will make active-duty service members completely exempt from paying state income taxes.
House Bill 1181, dubbed the “Honoring Our Military Exemption,” or HOME bill, allows members of the Armed Forces to maintain Colorado as their official home of record, without having to pay income taxes to the state.
It was spearheaded by Gov. John Hickenlooper and passed 56-9 in the House and 27-8 in the Senate. Ultimately, the bill will not cost tax payers anything extra. In fact, most Colorado service members don’t currently pay the state income tax in the first place. Most residents choose other states like Texas or Florida as their home of record, where they’re already exempt.
There was no reason for a service member stationed in Colorado to claim it as their home of record – until now. The proponents of the bill believe it will increase revenue by boosting the number of cars registered in the state.
Eventually the goal is to open up the exemption to apply to all active-duty service members around the country who want to claim Colorado as their home of record. But for now, establishing residency in the state is a prerequisite. The biggest issue still ahead of the state, proponents say, is simply getting the word out so all military residents are aware.