TABOR Refund Colorado: What It Means for Your Property Taxes as a First-Time Buyer

Every year or two, Colorado homeowners get a TABOR refund — a check from the state returning surplus revenue. In 2022 and 2023, that refund was over $750 per taxpayer. And yet, in those same years, property tax bills across the Front Range jumped by thousands of dollars.

If you are a first-time buyer trying to understand what Colorado's Taxpayer's Bill of Rights means for your future tax bill, the honest answer is: the TABOR refund does almost nothing to offset rising individual property taxes. Understanding why requires knowing how TABOR actually works.

What TABOR Actually Does

The Taxpayer's Bill of Rights, added to the Colorado Constitution in 1992 as Article X, Section 20, restricts how much revenue state and local governments can collect and keep. Each year, a taxing entity — the state, a county, a school district, a municipality — can only retain revenue up to a cap calculated by combining the prior year's revenue with a growth formula tied to inflation and new construction.

If actual revenue exceeds the cap, the excess must be refunded. That refund is what you see as the "TABOR refund" on your state income tax return.

Here is the critical point that catches buyers off guard: TABOR limits the total revenue a government can keep — not the tax rate on any individual property. Your property tax bill is determined by your assessed value multiplied by the applicable mill levy rates. If your home's assessed value rises — as happened across the Front Range when the reassessment cycle completed — your individual tax bill rises with it, even if the mill levy stays the same.

The government may eventually have to issue a refund because aggregate revenue exceeded the cap. But that refund is distributed broadly and typically offsets a small fraction of your individual tax increase.

Why Jefferson County Property Taxes Are Rising

Jefferson County first-time buyers frequently ask why their property taxes increase even when they have not done anything to trigger a reassessment. There are two overlapping causes.

Biennial reassessment. Colorado reassesses property values every two years in odd-numbered years. The 2025 reassessment reflected market sales data from the preceding 18 months — a period when Front Range home prices appreciated significantly. Higher assessed values translate directly into higher tax bills at the same mill levy rates.

House Bill 21-1164 school mill levy corrections. This is the less visible driver. During the 1990s and 2000s, voters in 118 of Colorado's 178 school districts approved "de-Brucing" measures — giving local school districts permission to keep revenues above TABOR limits. The Colorado Department of Education then mistakenly directed these districts to ratchet down their mill levies anyway, undercollecting tax revenue for decades.

HB 21-1164 mandates that these districts correct the error by increasing their local property tax levies by up to 1 mill per year until the undercollection is unwound. Jefferson County is one of the affected districts. Even if your home's assessed value stays completely flat, your school property taxes will rise annually until the correction is complete.

The Metro District Layer

If you are buying a newly constructed home in a planned community — particularly in suburban areas of Aurora, Douglas County, Broomfield, or the growing corridors of Colorado Springs — you may be entering a property with a Metropolitan District overlay. These are quasi-governmental special taxing districts that issued bonds to finance the roads, water lines, and parks in the subdivision. The debt is repaid through an additional mill levy on top of the county, school, and city levies.

A standard established neighborhood might have a combined mill levy of 70 to 80 mills. A metro district property can add 40 to 60 mills on top of that. On a $500,000 home, a 50-mill metro district overlay adds roughly $2,375 per year to your property tax bill. That is $198 per month that does not appear in online mortgage calculators and is not visible on a listing sheet.

Effective August 6, 2025, Colorado law requires sellers in metro district properties to deliver a comprehensive disclosure packet before you sign a purchase agreement. Read it carefully, and calculate the full mill levy yourself — the disclosure will show you the authorized cap, not necessarily the current rate.

What You Can Actually Count On

For practical planning as a first-time buyer in Colorado:

• Expect reassessment cycles to matter. If you buy in a year when values were assessed high, your first full-year property tax bill may be a shock if the prior owner's Closing Disclosure showed a lower rate.
• Budget for school mill levy increases. In Jefferson County and the other 117 affected districts, your school tax line will likely rise each year for the foreseeable future.
• Investigate metro district status before making an offer. Ask your agent whether the property sits in a Title 32 Metropolitan District, and request the current mill levy from the county treasurer.
• The TABOR refund helps state-level budgets more than individual homeowners. Do not factor it into your monthly carrying cost model.

Colorado's property tax system is genuinely complex — more so than in most states. The TABOR refund is real, but it operates at a different level from the mill levies and assessment cycles that determine what you actually pay each month into escrow.

The Colorado First-Time Home Buyer Guide covers the property tax calculation in detail, including a worksheet that walks through the county, school district, municipal, and any metro district levies that will apply to a specific property — so you know the true annual cost before you close, not after.

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