ALAMOSA — During his time in office, State Representative Matt Martinez (D-62) has consistently expressed his support for farmers and ranchers. That support was clearly demonstrated by passage of a bill related to agriculture and pertaining to stewardship of the land.  

Signed into law in May of 2024 and described by Martinez as “one of his favorite bills”, HB24-1249 creates a state income tax credit for active agricultural stewardship practices.  

“I really like this bill because it grants tax credits for being good stewards of the land,” Martinez told the Valley Courier. “By employing one of the practices that support good stewardship of the land, farmers can get at least $5 per acre and no more than $75 per acre of land up to a maximum of $150,000 tax credit in one income year. Farmers can get at least $10 per acre but not more than $100 per acre for a maximum tax credit of $200,000  in one income year for two qualified practices. For engaging in three practices, farmers can get at least $15 per acre but no more than $150 per acre not exceed $300,000 in tax credits.”  

To put it more briefly, the more stewardship practices farmers use, he says, the more benefit growers will reap with a bigger tax benefit.  

The program will be implemented for income tax years beginning on or after January 1, 2026, but before January 1, 2031. Reminder of this bill is especially important now as farmers and ranchers are making plans for 2025. 

As part of the process, the Colorado Department of Agriculture developed a list of accepted practices that incorporate a variety of approaches, including grazing or cropping practices that improve soil health, improve water retention and improve drought resiliency. Other practices create more diverse and beneficial ecosystems while maintaining productivity of the farm or ranch including crop rotation, less tillage or no tillage, cover crop being integrated, managing livestock grazing, range improvement or compost application. 

The program is capped at five years, but Martinez says the hope is that, after engaging in good stewardship, farmers will no longer need to be incentivized by tax credits as the practices themselves will allow them to reap significant benefits. 

To claim the credit, a qualified taxpayer must apply to the department of agriculture for a tax credit certificate. The department of agriculture will evaluate the application and issue the certificate if the taxpayer qualifies for the tax credit. If a tax credit certificate is issued, the qualified taxpayer must attach it to the taxpayer's income tax return and submit it to the department of revenue. 

The aggregate amount of tax credits issued in one calendar year cannot exceed $3 million. After certificates have been issued for credits that exceed an aggregate of $3 million for all qualified taxpayers during a calendar year, any claims that exceed the amount allowed are placed on a wait list and a certificate is issued for use of the credit in the next income tax year. No more than $2 million in claims shall be placed on the wait list in any given calendar year. 

Only one tax credit certificate may be issued per qualified taxpayer in an income tax year, and the qualified taxpayer claiming the credit may only receive the tax credit for up to three income tax years. No credit may be earned if the qualified taxpayer has received another tax credit, a tax deduction, or a grant related to agricultural land health from any source during the income tax year for which the tax credit is sought. 

Representative Ty Winter of Trinidad and Senators Rod Pelton and Dylan Roberts are also listed as prime sponsors on the bill.  

Anyone wishing to read the full text of the bill can do so by going to https://leg.colorado.gov/bills/hb24-1249.