Senate Committee Approves Bill to Incentivize Employee-Owned Businesses

HB25-1021 would implement an income tax credit for employee-owned businesses
DENVER, CO –
Legislation sponsored by Senator Jeff Bridges, D-Arapahoe County, to create tax incentives for employee-owned businesses passed the Senate Finance Committee today.
“Employee-owned businesses create a higher quality of life for workers, including higher wages, lower turnover, and better benefits and job security,”
Bridges said.
“Investing in employee ownership means investing in a more secure future for Colorado’s working families, and I’m proud to sponsor this legislation to encourage business owners to invest in their employees’ futures, too.”
Transitioning to an employee-owned model helps small businesses focus on investing in their employees and serving their communities.
HB25-1021
would create several new tax deductions and credits for businesses with an employee ownership model. In addition to the new tax incentives, the bill would extend the existing
Employee Ownership Tax Credit
within the Office of Economic Development and International Trade through tax year 2031.
The Employee Ownership Tax Credit, created by
HB21-1311
, is currently equal to 50 percent of the conversion costs for a business that converts to a worker-owned cooperative, an employee stock ownership plan, or an employee ownership trust. HB25-1021 would make the tax credit equal to 75 percent of the conversion cost. The income tax credit is fully refundable.
HB25-1021 now moves to the Senate Appropriations Committee for further consideration. Track its progress
HERE
.