Income Tax Credit for Parental School Engagement

The bill establishes a refundable state income tax credit for parental engagement in schools for income tax years commencing on or after January 1, 2025, but before January 1, 2030, that allows a taxpayer who is a parent, guardian, or legal custodian (taxpayer) to claim a credit when the taxpayer volunteers in the school of the taxpayer's child. Taxpayers are allowed a credit of $20 for each volunteer hour, up to $500.

An eligible school includes a school of a school district, a district charter school, an institute charter school, or a board of cooperative services at which the percentage of students receiving free or reduced-cost lunch under the national school lunch program equals at least 40%.

An eligible school shall issue a credit certificate to any taxpayer who volunteers in the school. The credit certificate allows the taxpayer to claim a credit with respect to the income taxes imposed by the state. To claim a credit, the taxpayer must submit the credit certificate to the department of revenue (department) with the taxpayer's income tax return for the income tax year for which a credit is claimed. The amount of the credit that exceeds the taxpayer's income taxes due is refunded to the taxpayer.

The bill encourages eligible schools to promote the credit to parents at the start of each school year and to provide volunteer opportunities throughout the year to accommodate parent schedules and interests.

The bill requires the Colorado state advisory council for parent involvement in education (council) to develop marketing materials to promote the credit to parents. The council shall conduct training sessions to instruct eligible schools on how to implement and manage a volunteer program to align with the credit. The training sessions must use best practices for parental engagement. On or before May 1, 2026, the council shall create and distribute a statewide parental engagement feedback survey (survey) to solicit and collect parental engagement feedback from parents. The purpose of the survey is to measure parental engagement participation and to determine whether parental engagement provides support to eligible schools.

At the end of each school year through 2030, eligible schools are required to solicit feedback, using the council's survey, from parents concerning volunteer experiences. On or before July 1, 2026, and each July 1 thereafter through July 1, 2030, eligible schools shall submit the survey data to the school districts. On or before October 1, 2026, and each October 1 thereafter through October 1, 2030, school districts shall report the survey data to the department of education.

The bill requires the department of education to submit an annual report summarizing the survey data reported by the school districts to the department on February 15, 2027, and each February 15 thereafter through February 15, 2031, to the state auditor, the education committees of the house of representatives and the senate, or their successor committees, and the finance committees of the house of representatives and the senate, or their successor committees.

The bill repeals the state income tax credit, effective July 1, 2033.

(Note: This summary applies to this bill as introduced.)