The Colorado Department of Revenue is now reviewing all EV tax credit denials after a coding error was discovered following a story by Steve On Your Side.
DENVER – The Colorado Department of Revenue said a coding error in an automated system for state electric vehicle tax credits led to new electric vehicle owners being denied the credits.
A spokesperson for the Colorado Department of Revenue’s tax division said the department began reviewing internal processes after a Steve On Your Side story last week questioned several credit denials for consumers who appeared to meet the criteria.
After that story aired, more than 50 EV owners contacted Steve On Your Side to complain about the same issue.
Mark Christensen told 9NEWS consumer investigator Steve Staeger that he purchased his Hyundai Ioniq 5 specifically knowing the vehicle would qualify for the state tax credit. His accountant claimed the innovative motor vehicle tax credit on her 2023 tax return.
“I received a letter about two weeks after the filing date saying the refund had been disqualified because the state of Colorado said it was only a 24-month lease,” Christensen said. “And really this car was a 36-month lease.”
“My accountant said it’s a lot of fun,” Christensen said. “His six clients have the same problem.”
In an initial story on this topic, the Colorado Department of Revenue told Steve On Your Side that there were “no systemic issues” causing credit denials. The department noted that it had recently switched from a manual review of innovative motor vehicle credits to an automated system.
After more than four dozen similar complaints on the Steve On Your Side tip line, we again asked the state for comment. It took about a week, but on Friday, spokesperson Derek Kuhn told Steve On Your Side that the error was discovered because of the story.
“The Department is implementing new approaches to automated processing of this tax credit,” Kuhn said by email. “Those automations have already reduced the average time to process these loans from more than 8 months to approximately one month. One of those automated processes confirms that leased vehicles have a lease that lasts longer than two years, as required by law. “That feature had a coding error that affected credits submitted for tax year 2023, which may have resulted in credits being incorrectly denied for some leased vehicles.”
Kuhn said the department has now dedicated staff to review all denied credits.
“We are contacting taxpayers who purchased vehicles in 2023 directly by letter to ensure they receive the credits they deserve,” Kuhn said.
Chris Walsh, who appears in the same Steve On Your Side story, said he filed a letter of protest with the state and continued to call the state’s tax defense department. He said someone finally responded and said the department was investigating the matter. A few weeks later he received notification that he would receive the money from him.
“I think because I walked up, they put my card on top of the pile, looked at it and said, ‘Okay, yeah, everything’s okay,'” Walsh said.
Christensen and many others who contacted Steve On Your Side’s tip line said they are still waiting for their money.
“It’s still somewhere in limbo,” he said. “I have no idea where she is.”
“Big news shouldn’t be necessary for something so simple. “It’s frustrating that it’s taking this long and the state of Colorado isn’t taking any action.”
This story was the result of a tip to Steve On Your Side. He shared his consumer problem with 9NEWS consumer investigator Steve Staeger.
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