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Colorado Challenge to Fraternal Premium Tax Exemption – January 2020

January 14, 2020

While the current challenge to the fraternal premium tax exemption in Colorado is limited to one state, it is an important issue for all fraternals. States tend to pick up on ideas from each other, so what happens in one could be easily exported to others. Moreover, the search for additional government revenue that has led to the examination of the Colorado fraternal exemption can and does occur in other states.

Last October, a special legislative committee tasked with reviewing tax exemptions took formal steps to repeal the fraternal exemption in Colorado. A bill was drafted and public hearing held. Due to efforts of Thrivent, the Knights of Columbus and Modern Woodmen – and their Colorado members, in particular – the bill failed to advance. Unfortunately, two legislators who supported the repeal bill vowed to resurrect it during the 2020 legislative session which began on January 8.

So that week, a small group representing fraternals headed to Denver to continue the advocacy effort. Brian Casey of Thrivent, Tim Saccoccia of the Knights of Columbus, Allison Koppel of the Alliance, and the Alliance’s retained lobbyist in Colorado, Steve Holdren, met with legislators to educate them about the fraternal system and our presence in their state. The fraternal team learned that the possibility of legislation being introduced to repeal the exemption is still very much alive, but that support for such a bill at this early stage is limited.

Picture one of small group of fraternal representatives visiting Denver to continue advocacy effort.
Picture two of small group of fraternal representatives visiting Denver to continue advocacy effort.

In the short term, the Alliance Advocacy & Policy Committee will remain actively engaged in this issue and support additional pro-active outreach to legislators to tell the positive fraternal story. Alliance members can help this effort in the following ways:

  1. Fraternals with robust chapter events in Colorado can provide a few detailed examples of their most impactful events to the Alliance;
  2. Determine whether any of your Colorado agents or member volunteer leaders have relationships with legislators;
  3. Identify upcoming quality local chapter/lodge events elected officials could be invited to;
  4. Prepare for how your society would encourage your Colorado members to call or email their legislators to support fraternals if a repeal bill is introduced.

To help in these ways or others, email Allison at the Alliance (akoppel@fraternalalliance.org).

Stay tuned for more information on this issue.