Colorado Tax Credit Benefits 19,000 Childcare Workers

Why this is here: The new tax credit distributed roughly $23 million in relief to Colorado’s care workers during its first year.

More than 19,000 childcare teachers and staff in Colorado claimed a new $1,200 state tax credit this year. The Care Worker Tax Credit debuted with the 2025 tax filings and extends to those supporting young children, older adults, or people with disabilities. Roughly 17,500 workers in state-licensed facilities and 1,800 family, friend, and neighbor caregivers received about $23 million in tax relief.

The credit aims to address lower wages common among early childhood educators. It’s available to single filers earning $75,000 or less and joint filers earning $100,000 or less. The credit is refundable, meaning eligible filers receive the full amount even if it exceeds their tax liability.

State officials will not have data regarding workers supporting older adults and people with disabilities until fall. Another Colorado tax credit for early childhood educators is set to expire after the 2025 tax year. Workers who have already filed can amend their returns to claim the credit by October 15.