A TABOR refund is money Colorado sends back to taxpayers when the state collects more tax revenue than the law allows it to keep

Colorado has a law called the Taxpayer Bill of Rights, or TABOR. It limits how much tax money the state can spend each year. When Colorado's economy is strong and tax collections grow faster than the limit allows, the state must return the extra money to the people who paid it. That return is called a TABOR refund.

The refund is not something you request or explore for. If you filed a Colorado state income tax return for the year in question, you are part of the group that receives one. The state calculates the total refund amount, divides it among all taxpayers based on what each person paid, and sends it out automatically.

TABOR refunds are rare. Colorado has only issued them a handful of times since the law passed in 1992. The most recent refund was in 2023, when the state returned money to taxpayers from the 2022 tax year. Whether another refund happens depends entirely on whether Colorado collects more revenue than TABOR allows in future years.

Key Takeaways

  • A TABOR refund happens when Colorado collects more tax revenue than state law permits it to spend, and the excess must be returned to taxpayers.
  • You do not need to do anything to receive a TABOR refund — the state sends it automatically if you filed a Colorado income tax return for that year.
  • The refund amount you receive is based on the income tax you paid, not a flat amount to every resident.
  • TABOR refunds are uncommon and have only occurred a few times since 1992, so you should not count on receiving one in any given year.

How the state calculates your individual refund amount

Colorado does not divide the refund equally among all taxpayers. Instead, the state calculates what share of the total tax revenue each person paid, then gives that same share of the refund to each person.

If you paid $1,000 in Colorado income tax and the total refund pool is $100 million, your share depends on what percentage of all Colorado income tax you represented. The state uses tax return data to make this calculation. People who paid more tax receive larger refunds; people who paid less receive smaller ones.

The state announces the refund amount per dollar of tax paid. For example, in 2023, Colorado announced that taxpayers would receive approximately 4.5% of the income tax they paid in 2022. If you paid $2,000 in 2022 Colorado income tax, your refund would have been roughly $90. The exact percentage varies depending on how much total revenue needs to be returned.

When and how you receive your TABOR refund

The timing of a TABOR refund depends on when the state legislature certifies that a refund is required. This usually happens months after the tax year ends, once Colorado has final revenue numbers. For the 2022 tax year refund, the state announced it in mid-2023 and began sending refunds in the fall of that year.

The state sends TABOR refunds in the same way you received your tax refund that year. If you filed electronically and chose direct deposit, your TABOR refund goes to the same bank account. If you filed by mail or chose a paper check, you receive a check in the mail. You do not need to provide banking information again.

Some people owe Colorado taxes or have unpaid child support or other debts. The state may use your TABOR refund to pay those debts before sending you the remainder. If you think this might explore to you, contact the Colorado Department of Revenue before the refunds are issued to understand what will happen to your refund.

Who receives a TABOR refund and who does not

You must have filed a Colorado state income tax return for the year in question to receive a refund. This includes people who filed even if they owed no tax or received a refund. It does not include people who did not file a return at all, even if they lived in Colorado and earned income.

Non-residents who filed Colorado tax returns because they earned income in the state are also included in TABOR refunds. The refund is based on Colorado income tax paid, not on residency status.

People who are claimed as dependents on someone else's tax return do not file their own return and do not receive a separate TABOR refund. The refund goes to the person who filed the return and claimed them as a dependent.

The difference between a TABOR refund and a regular tax refund

A regular tax refund happens when you overpay your taxes during the year through withholding or estimated payments. You get that money back because you paid more than you owed. A TABOR refund is different — it is money the state collected from everyone but is not allowed to keep under state law.

You might receive both in the same year. Your regular tax refund comes when you file your return, usually within weeks. A TABOR refund comes later, after the state certifies that excess revenue exists. The two are separate payments based on different reasons.

What TABOR means for Colorado's budget

TABOR limits Colorado state spending to a specific formula based on population growth and inflation. If the economy grows faster than that formula allows, the state collects more tax revenue than it can legally spend. The refund requirement is built into the law as a way to prevent the state from accumulating surplus revenue.

This means TABOR refunds signal a strong economy and higher-than-expected tax collections. They do not mean the state has extra money to spend on schools, roads, or other services. In fact, the refund requirement can make it harder for the state to fund services during years when revenue is high.

Colorado voters have the power to change TABOR through ballot measures. Any change to how refunds work or whether they happen at all would require a vote. The law has been in place for over 30 years and remains a significant part of how Colorado manages its budget.

Frequently Asked Questions

Do I have to pay taxes on my TABOR refund?

No. A TABOR refund is not taxable income at the federal or state level. You do not report it on your federal tax return, and Colorado does not tax it either. It is treated as a return of taxes you already paid, not as new income.

What if I did not receive my TABOR refund?

Contact the Colorado Department of Revenue to check the status. If you filed a return for that year, you should have received one. Possible reasons for not receiving it include the refund being applied to back taxes or debts, an incorrect mailing address on file, or a processing error. The department can look up your specific situation.

Can I claim a TABOR refund I did not receive?

Yes, but you must act within the time limit set by the state. Colorado typically allows you to claim a refund for a limited period after it is issued. Contact the Department of Revenue with proof that you filed a return for that year and did not receive your refund. They can issue a replacement check or deposit.

Will Colorado have another TABOR refund soon?

That depends on whether Colorado collects more revenue than TABOR allows in future years. Refunds are not may provide and have only happened a few times since 1992. You should not count on receiving one in any particular year. The state will announce if a refund is coming once final revenue numbers are certified.