According to the IRS, tax credits are an amount you subtract from the amount of tax you owe. There are two types of tax credits:

• A nonrefundable tax credit means you get a refund only up to the amount you owe.
• A refundable tax credit means you get a refund, even if it’s more than what you owe.

There are two important refundable credits that are available both at the federal level and state level, the Earned Income Tax Credit (EITC) and the Child Tax Credit (CTC).

According to the IRS, the Earned Income Tax Credit (EITC) is a refundable tax credit that helps low- to moderate-income workers and families. If you qualify, you can use the credit to reduce the taxes you owe – and maybe increase your refund. In Colorado, people can receive both the Federal EITC and Colorado’s state match of the Federal EITC.

The Child Tax Credit (CTC) is a refundable tax credit meant to help working families offset the costs of raising children. Filers with children can receive up to $2,000 per child under the age of 17 from the federal credit. If the credit exceeds taxes owed, families may receive up to $1,600 per child as a refund. Other dependents—including children ages 17–18 and full-time college students ages 19–24—can receive a nonrefundable credit of up to $500 each. The maximum amount families can receive from the Colorado Child Tax Credit is $1,200.

You could be leaving money on the table when you file your taxes. The EITC and CTC are also powerful anti-poverty measures.

• In 2018 the Federal EITC pulled 5.6 million people out of poverty including about 3 million children, and in 2019, it boosted the incomes of 9 million women of color.

• The CTC lifted approximately 4.3 million people out of poverty in 2018, including about 2.3 million children, and lessened poverty for another 12 million people, including 5.8 million children. 

The EITC and CTC are powerful ways to put money in the pockets of working families that they can use for whatever they need or to offset what they owe when they file their taxes. You can check out our factsheets below for more on the benefits of the EITC and CTC. At CFI, we look to further expand the impact and eligibility of these tax credits.

Alongside advocates, community partners, and legislators, the Colorado Fiscal Institute has been at the forefront of advocating for the implementation of, expansion to, and outreach efforts for the EITC. In 2013, Senate Bill 001 made the state EITC a permanent part of Colorado's tax code and set the credit amount at 10% of the federal. In 2020, we made the credit available to people who file taxes using an ITIN and in 2021 we doubled the credit amount to 20%. In 2023, Colorado temporarily increased the state credit to a 50% match of the federal EITC. Thanks to policy passed in 2024, the state EITC is a 50% match again for tax year 2024. In tax year 2025 the Colorado EITC will be a minimum of a 35% match, with the possibility of a 50% match depending on economic growth.

In addition, we expanded eligibility for the EITC state match to everyone 18 and up, and included folks with Individual Taxpayer Numbers (ITIN) as eligible to receive the state match. Unfortunately, ITIN filers do not currently qualify for the Federal EITC.

What is an ITIN Filer?

ITIN Filers are folks who pay taxes but do not have social security numbers. Many of these individuals are immigrants who pay taxes into the public services we all benefit from like public education, roads, and local services. If you pay taxes with an ITIN in Colorado, you may be eligible for the state EITC, CTC, and FATC with no consequence to your immigration status.

The state version of the Child Tax Credit was passed into law in 2013, but up until 2021, hadn’t been funded. During the 2021 legislative session, the Colorado Fiscal Institute alongside partners and legislators finally funded our Colorado Child Tax Credit match. The state CTC is available for eligible families with children under the age of 6 and can receive $200 to $1200 per child. Parents who file with ITINs are also eligible to receive the Colorado’s Child Tax Credit. 

In 2024, CFI and our partners passed a new refundable state credit called the Family Affordability Tax Credit (FATC) for families with eligible children aged 16 and under. Families with children under the age of six can receive up to $3,200 per child, and families with children between six and sixteen can receive up to $2,400. In combination with expansions to the EITC made in 2024, both policies are projected to reduce childhood poverty in Colorado by 40%.

1. If you are filing with an ITIN, be sure that your ITIN is up to date. You can find more information here.
2. Find free tax preparation.
3. Collect all necessary tax documents
4. Ask your tax preparer if you are eligible for the EITC, CTC, and FATC.
5. If you qualify, you’ll receive either a larger refund or, if you owe taxes, a reduction in how much you owe.

The biggest reason individuals don’t claim the EITC and CTC on their tax returns is because they don’t know about it. In 2020, over 28% of eligible individuals in Colorado missed out on the credit. Below we have posted tax help resources to share. You can also follow us on social media to stay up to date on tax credit resources and share them with your networks. Share this resource page with others who could benefit from claiming these powerful tax credits.

• Get Ahead Colorado is a public information campaign from the Colorado Department of Public Health and Environment (CDPHE) that highlights free resources for tax filing so Coloradans can receive cash back through the Earned Income Tax Credit, Child Tax Credit, and other credits.
• Tax Help Colorado is another trusted partner of ours dedicated to providing free tax filing assistance to families earning less than about $67,000 a year, saving them money, while receiving the best service possible.
• GetYourRefund.org provides free tax filing help by partnering with IRS-certified Volunteer Income Tax Assistance (VITA) sites to provide tax filing assistance to families earning less than $67,000 a year.
• Get It Back Campaign helps eligible individuals claim tax credits and use free tax filing assistance to maximize tax time. A project of the Center on Budget and Policy Priorities, the Campaign partners with community organizations, businesses, government agencies, and financial institutions to conduct outreach nationally.
• IRS EITC Information can help you check if you qualify and learn how to claim the credit.