In a strong bipartisan vote, the Colorado House Finance Committee advanced HB25-1015 Thursday, extending the popular Homeless Contribution Income Tax Credit through 2030. The move keeps a proven tool that turns taxpayer generosity into real help for people sleeping on streets, in cars, or in shelters across the state.

The credit has quietly become one of Colorado’s most effective weapons against homelessness. Since its creation, it has driven tens of millions of dollars to nonprofits that provide emergency beds, rental assistance, job training, and permanent housing. Lawmakers say losing it would gut services at the worst possible time.

How the Tax Credit Actually Works

Colorado taxpayers who donate cash to approved homelessness programs can claim 25% of their gift as a state income tax credit. Give $1,000, get $250 off your state taxes. The credit is capped at the amount of tax you owe, but unused portions can carry forward for five years.

The program works differently than a deduction. It is a dollar-for-dollar reduction in tax liability, making it far more valuable than the federal charitable deduction alone. Nonprofits apply to the state Division of Housing for approval, and once certified, every donation they receive qualifies.

In 2023, the program generated more than $9 million in tax credits, meaning Coloradans donated roughly $36 million to homeless services in a single year. That money funded everything from Grand Junction’s emergency shelter to Denver’s rapid rehousing programs.

Bipartisan Champions Step Up

The bill’s prime sponsors, Democratic Rep. Karen McCormick of Longmont and Republican Rep. Rick Taggart of Grand Junction, represent districts miles apart in every sense. Yet both say the credit is too successful to let expire.

“If we didn’t have this tax credit in place, which has shown such success over the years, the need wouldn’t go away, and those services would still be needed,” McCormick told the committee.

Taggart pointed to rural Colorado’s unique struggles. While Denver grabs headlines, towns like Grand Junction, Montrose, and Pueblo have seen sharp rises in street homelessness. The credit helps small rural nonprofits compete for private dollars against bigger urban organizations.

The committee passed the bill 10-3, with support from both parties. Only three Republicans voted no, citing general concerns about expanding tax credits.

Homelessness Numbers Keep Climbing

Colorado’s homeless population jumped 38% between 2020 and 2024, according to HUD’s annual Point-in-Time count. On a single night in January 2024, volunteers counted 18,711 people experiencing homelessness statewide, the highest number ever recorded.

Denver continues to bear the heaviest burden, but rural counties now report waiting lists for shelter beds that never existed before. Mesa County, home to Grand_FILL Grand Junction, saw its unsheltered count double in two years.

Nonprofit leaders told lawmakers that without the tax credit, many would have to cut staff or close facilities. “This credit is the difference between keeping our doors open and turning people away,” said one shelter director during testimony.

What Happens Next

The bill now heads to the full House, where it is expected to pass easily. After that, it moves to the Senate Finance Committee and then the governor’s desk.

Governor Jared Polis has supported previous extensions of the credit and is likely to sign this one. If approved, the extension takes effect immediately and keeps the program alive for donations made through December 31, 2029, covering tax years through 2030.

This is not the first time lawmakers have extended the credit. They originally created it as a pilot in 2014, then renewed it in 2019 and again in 2021. Each time, donation levels have grown, proving the incentive works exactly as intended.

For everyday Coloradans, the message is simple: your donation this year will still save lives and save you money on taxes for years to come.

The fight against homelessness is far from over, but Thursday’s vote showed that when something actually works, Colorado leaders from both parties are willing to keep it going. Thousands of our neighbors who sleep outside tonight have a better chance at a roof tomorrow because of it.

What do you think Colorado should do next to solve homelessness? Drop your thoughts in the comments below.