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HB 25B-1002

Corporate Income Tax Foreign Jurisdictions

2025 First Extraordinary Session Introduced by Judy Amabile and 32 co-sponsors

Colorado corporate tax changes foreign income rules: refines apportionment/sourcing, foreign tax credits, and anti-base erosion for foreign subsidiaries; impacts multinationals.

Governor Signed
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Bill Summary · HB 25B-1002

Summary — HB 25B-1002: Corporate Income Tax — Foreign Jurisdictions

Quick facts

  • Bill number: HB 25B-1002
  • Title: Corporate Income Tax — Foreign Jurisdictions
  • Status: Governor Signed (sent to governor 2025-08-26; signed 2025-08-28)
  • Introduced: August 21, 2025
  • Primary sponsors listed: Matt Ball; Bob Marshall; Yara Zokaie (multiple additional cosponsors)
  • Legislative progress highlights:
    • Introduced in House: 2025-08-21 (assigned to Appropriations)
    • Passed House (Second Reading with amendments 2025-08-22; Third Reading passed 2025-08-23)
    • Passed Senate (Second Reading 2025-08-23; Third Reading 2025-08-24)
    • Signed by legislative leaders and delivered to the Governor 2025-08-26
    • Governor signed 2025-08-28

Note: The official bill text was not provided with your request. The summary below explains likely goals, typical provisions, affected parties, and procedural points based on the bill title and legislative status. For the exact statutory changes, consult the enrolled bill text posted by the Colorado General Assembly.

Purpose and intent (based on title)

By its title, HB 25B-1002 addresses how Colorado’s corporate income tax treats income, taxes, or entities connected to foreign (non‑U.S.) jurisdictions. Typical objectives for bills with this scope include:
- Clarifying how foreign‑sourced corporate income is apportioned or sourced for Colorado tax purposes;
- Defining or adjusting state treatment of taxes paid to foreign jurisdictions (e.g., addbacks, credits, or exclusions);
- Preventing profit shifting and base erosion through rules on controlled foreign entities or related‑party transactions;
- Aligning state rules with recent federal changes or multilateral tax standards.

Key provisions (likely topics — confirm against enrolled text)

Because the bill text is not available here, the following are commonly addressed elements in similar legislation:
- Modification of apportionment formulas or sourcing rules for income earned outside the U.S. (affecting denominator/numerator for Colorado apportionment).
- Rules for claiming state tax credits or deductions for foreign taxes paid (limitations, carryforward, or addback requirements).
- Definitions and reporting requirements for foreign subsidiaries, branches, or controlled foreign corporations (CFCs).
- Anti‑avoidance measures (e.g., adjustments for related‑party transactions, transfer pricing conformity, or anti‑base erosion provisions).
- Administrative provisions directing the Department of Revenue to issue guidance or rules, and penalties for noncompliance.

Who is affected

  • Corporations doing business in Colorado with foreign income, subsidiaries, or payments to foreign affiliates.
  • Inbound and outbound investors whose entities are subject to Colorado corporate income tax.
  • Tax advisers, accountants, and the Colorado Department of Revenue (administration and enforcement).
  • Potential indirect effects on pricing, investment, and corporate structuring for firms operating internationally.

Fiscal and procedural notes

  • The bill completed the legislative process rapidly (introduced 8/21/2025 and signed 8/28/2025).
  • The effective date and any transitional rules are not included in the provided metadata; check the final enrolled bill for implementation timing, applicability to taxable years, and fiscal notes (state revenue impact).

For precise statutory language, eligibility rules, dollar or percentage limits, effective dates, and fiscal impact estimates, review the enrolled bill text and fiscal note on the Colorado General Assembly website (search HB 25B-1002).

Compiled from official sources — confirm details with the bill’s official record.

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