Income Tax Statute Modification To Address Defects

The act: Repeals an income tax deduction for money earned on Colorado investment deposits issued by a qualified financial institution because the definition of "Colorado investment deposits" relies on the "Colorado Investment Deposit Act", which was repealed in 2004, so it is unlikely that there have been any new certificates of deposit issued since 2004; and there are also no known eligible certificates of deposit that still exist and thus there would be no allowable amount of interest earnings to subtract. Repeals 2 income tax deductions meant to correct for the difference between the standard deduction amounts for federal income tax filings that used to be called the "marriage penalty" approximately 15 years ago. The "marriage penalty" was addressed by Congress in 2003, so the deductions are no longer necessary. Repeals an income tax credit for estate taxes paid on the transfer of agricultural land. The Colorado estate tax is effectively zero because it is based on a federal credit in the provisions of the federal estate tax. The federal provision for the credit is not allowed for estates of decedents who passed away after December 31, 2004. Because the federal credit has not been extended, there is no state estate tax, and thus the income tax credit is not useable. Addresses some circular cross references within the statutory section. Corrects an issue in statute that erroneously requires nonresident beneficiaries to prepay income tax twice, once through estimated payments and again through tax withheld by the fiduciary.(Note: This summary applies to this bill as enacted.)