C.R.S. § 39-22-538 — Credit for health-care preceptors working in health professional shortage areas - legislative declaration - definitions

(1) (a) The general assembly finds, determines, and declares that: (I) to (III) (Deleted by amendment, L. 2022.) (IV) The COVID-19 pandemic and subsequent economic crisis have caused significant challenges for Colorado's health-care system and exacerbated the workforce shortage across multiple disciplines and sectors of the health-care industry; (V) While the pandemic has had lasting impacts on the entire health-care system across the state, rural Colorado is experiencing the most severe workforce turnover and shortages, and as a result these communities experience reduced access to primary care services and exhibit poorer health outcomes; (VI) Rural communities often face challenges in recruiting an adequate health workforce, making it difficult to provide needed patient care or to meet staffing requirements for their facilities. Therefore, rural health-care facilities should be proactive and strategic about recruiting and retaining primary care personnel, which includes professionals in physical, dental, behavioral, and mental health. (VII) Most of Colorado's forty-seven rural and frontier counties are also designated as primary care health professional shortage areas by the Colorado primary care office; (VIII) Preceptorship programs are a critical component of clinical training and a proven approach to developing one-on-one relationships between expert professionals and students needing to develop the clinical skills and practical experience of working with patients in rural settings; (IX) Health professional students who obtain a significant amount of their clinical training in rural communities and under the guidance of rural health-care providers are much more likely to live and work in a rural or frontier area after completing their health professional training; (X) Recent studies and surveys by the American academy of family physicians have shown that primary care physicians are more likely to engage in preceptorships when professional recognition and financial incentives are provided; and (XI) The general assembly therefore finds that maintaining a highly qualified and sustainable rural health-care workforce depends on the extension and expansion of the rural and frontier health-care preceptor tax credit to provide sufficient financial incentives to preceptors statewide. (b) and (c) (Deleted by amendment, L. 2022.) (d) In accordance with section 39-21-304 (1), which requires each bill that extends an expiring tax expenditure to include a tax preference performance statement as part of a statutory legislative declaration, the general assembly hereby finds and declares that: (I) The general legislative purposes of the tax credit allowed by this section are: (A) To induce certain designated behavior by taxpayers, specifically the offering of professional instruction, training, and supervision to students seeking careers as primary health-care providers in rural areas and frontier areas of the state; and (B) To provide tax relief to preceptors in rural and frontier areas of the state who offer the professional instruction, training, and supervision described in subsection (1)(d)(I)(A) of this section; and (II) The specific legislative purpose of the tax credit allowed by this section is to encourage preceptors to offer professional instruction, training, and supervision to students matriculating at Colorado institutions of higher education who are seeking careers as primary health-care providers in rural and frontier areas of the state. In order to allow the general assembly and the state auditor to measure the effectiveness of the credit, the department of revenue, when administering the credit, shall require each taxpayer who claims the credit to submit a certification form with each income tax return form in accordance with subsection (4) of this section. The certification form must verify that the taxpayer has satisfied the requirements for allowance of the tax credit as specified in this section and state the number of eligible health professional students that the taxpayer has instructed, trained, or supervised during the applicable income tax year. (2) As used in this section, unless the context otherwise requires: (a) AHEC or AHEC program means the area health education center. (b) Frontier area means a county in the state that has a population density of six or fewer individuals per one square mile. (c) Repealed. (c.5) Health professional student means an individual matriculating at any accredited Colorado institution of higher education seeking a degree or certification in a primary health-care field. (d) Preceptor means a medical doctor, doctor of osteopathic medicine, advanced practice nurse, physician assistant, doctor of dental surgery, doctor of dental medicine, registered nurse, registered dental hygienist, pharmacist, licensed clinical or counseling psychologist, licensed clinical social worker, licensed professional counselor, licensed marriage and family therapist, psychiatric nurse specialist, licensed addiction counselor, or certified addiction counselor working in an outpatient clinical setting who has been licensed in his or her primary health-care field in the state by the applicable licensing authority. (e) Preceptorship means an uncompensated mentoring experience in which a preceptor provides a program of personalized instruction, training, and supervision for a total of not less than four consecutive or nonconsecutive working weeks or twenty consecutive or nonconsecutive business days per calendar year that is offered to eligible health professional students to enable the students to obtain eligible professional degrees or certifications. (f) Primary health-care means the provision of integrated, equitable, and accessible health-care services provided by clinicians who are accountable for addressing a large majority of personal health-care needs, developing a sustained partnership with patients, and practicing in the context of family and community. Integrated health-care encompasses the provision of comprehensive, coordinated, and continuous services that provide a seamless process of care. (g) Rural area means an area listed as eligible for rural health funding by the federal office of rural health policy. (h) Taxpayer means a preceptor who files an income tax return under this article. (3) (a) (I) For income tax years commencing on or after January 1, 2017, but prior to January 1, 2025, and subject to the requirements of subsection (3)(b)(I)(A) of this section, a taxpayer is allowed a credit against the income taxes imposed by this article 22 in an amount equal to one thousand dollars for a preceptorship provided by the taxpayer during the applicable income tax year for which the credit is claimed. (II) For income tax years commencing on or after January 1, 2025, but prior to January 1, 2033, and subject to the requirements of subsection (3)(b)(I)(B) of this section, a taxpayer is allowed a credit against the income taxes imposed by this article 22 in an amount equal to two thousand dollars for each preceptorship provided by the taxpayer during the applicable income tax year for which the credit is claimed. A credit is allowed for a maximum of three preceptorships per applicable income tax year. The maximum total credit in a taxable year is six thousand dollars. (b) Notwithstanding any other provision of this section: (I) (A) For income tax years commencing before January 1, 2025, the aggregate amount of the credit awarded to any one taxpayer under this section shall not exceed one thousand dollars for any one income tax year regardless of the number of preceptorships undertaken by the taxpayer during the applicable income tax year or the number of eligible health professional students the taxpayer instructs, trains, or supervises during the applicable income tax year. (B) For income tax years commencing on or after January 1, 2025, but prior to January 1, 2033, the aggregate amount of the credit awarded to any one taxpayer under this section shall not exceed six thousand dollars for any one income tax year regardless of the number of preceptorships undertaken by the taxpayer during the applicable income tax year or the number of eligible health professional students the taxpayer instructs, trains, or supervises during the applicable income tax year. (II) A taxpayer is eligible to claim the credit allowed by this section if the taxpayer performs a preceptorship that lasts a total of not less than four consecutive or nonconsecutive working weeks or twenty consecutive or nonconsecutive business days during the income tax year in which the credit is claimed and the preceptor is practicing in the preceptor's primary health-care field in a rural or frontier area; and (III) Not more than three hundred preceptors are entitled to claim the credit authorized by this section for any one income tax year. The department shall promulgate by rule, in accordance with article 4 of title 24, a method for determining the manner in which taxpayers who have obtained certification under subsection (4) of this section are able to claim the tax credit. (4) To qualify for the credit provided by this section, the taxpayer shall submit a certification form with each income tax return. Certification may be provided by either the institution for which the taxpayer teaches, whether it is an institution of higher education or a hospital, clinic, or other medical facility, or by the particular regional office of the AHEC program with jurisdiction over the area in which the preceptor's medical practice is located. In the case of certification by an institution for which the taxpayer teaches, the institution must execute the form certifying that the taxpayer has satisfied the requirements for allowance of the tax credit as specified in this section and identifying the number of eligible health professional students that the taxpayer has instructed, trained, or supervised during the applicable income tax year through all preceptorships provided by the taxpayer. In the case of certification by the AHEC program, the certification form must be obtained from the particular regional office of the AHEC program with jurisdiction over the area in which the preceptor is practicing, which office shall certify that the taxpayer has satisfied the requirements for allowance of the tax credit as specified in this section and identify the number of eligible health professional students the taxpayer has instructed, trained, or supervised during the applicable income tax year through all preceptorships provided by the taxpayer. The AHEC program may charge the taxpayer a reasonable fee for providing such certification, which fee shall not exceed the actual costs incurred by the AHEC in completing the certification. (5) Where a taxpayer claims the credit provided by this section but fails to satisfy the requirements of this section during the income tax year for which the credit is claimed, the taxpayer shall repay the entire amount of the total credit that is attributed to him or her pursuant to this section. The taxpayer shall report the recapture required by this subsection (5) by increasing his or her income tax liability by the amount of the total credit claimed for the year in which the recapture occurs. (6) If the amount of the credit allowed pursuant to this section exceeds the amount of the income tax otherwise due on the taxpayer's income in the income tax year for which the credit is being claimed, the amount of the credit not used as an offset against income taxes in the income tax year is not allowed as a refund but may be carried forward and applied against the income tax due in each of the five succeeding income tax years, but must first be applied against the income tax due for the earliest of the income tax years possible. (7) Nothing in this section modifies or changes the definition of public employee specified in section 24-10-103 (4)(b)(II) and (4)(b)(V), C.R.S. (8) Repealed. Source: L. 2016: Entire section added, (HB 16-1142), ch. 229, p. 891, § 1, effective August 10. L. 2017: (2)(e) amended, (SB 17-294), ch. 264, p. 1418, § 119, effective May 25. L. 2019: (2)(e), (3)(a), and (3)(b)(II) amended and (8) repealed, (HB 19-1088), ch. 363, p. 3355, § 1, effective August 2. L. 2022: (1), (2)(d), (2)(e), (2)(f), (2)(g), (3), and (4) amended, (2)(c) repealed, and (2)(c.5) added, (HB 22-1005), ch. 299, p. 2137, § 1, effective August 10. L. 2024: (3)(a) and (3)(b)(I) amended, (HB 24-1036), ch. 373, p. 2534, § 31, effective August 7. Cross references: For the legislative declaration in HB 24-1036, see section 1 of chapter 373, Session Laws of Colorado 2024.