By Todd Shepherd, COLORADO NEWS AGENCY

For years, the tax checkoff options on the Colorado tax return have provided dozens of charities with a constant flow of dollars. But recent emails from inside the Department of Revenue suggested that part of the system was open to manipulation concerning which charities stay on the tax form.

Each tax checkoff, once approved by the General Assembly and after being on the tax form for three years, must achieve and maintain $75,000 in donations annually. Failing to meet that statutory requirement would mean the charity would no longer be placed on the tax form.

Earlier this year, three board members of the Colorado Pet Overpopulation Fund made donations to their own charity via the checkoff box in addition to taxes that they owed the state. The fact that the board members were making donations on top of taxes they owed, rather than from a refund they were due, sparked a debate inside the Department of Revenue. Some department officials were not certain the Revenue Department should allow individuals to make contributions in cases where taxes were owed, arguing that charitable donations should only be collected in instances where refunds were due.

At this point in the debate inside the Revenue Department, senior tax director John Vecchiarelli theorized in a departmental e-mail that the system was open to being manipulated:

“I may be missing something, but why is it better for the donor to pay us extra and have us send the money to the charity rather than donating directly to the charity? The only reason that I can think of, is so that the charity can make a final push to receive sufficient check-off donations to allow it to remain on the return. If this is the only reason it seems just a tad bit disingenuous. As for the comment that 3 Board members were in this position, I ask why did 3 Board members want to make check-off donations on their tax return, I think the answer may be that they wanted to keep their charity on the return even though the general taxpaying public did not make sufficient check-off donations to satisfy the statutory requirement to remain on the return.”

In fact, it is highly unlikely the Colorado Pet Overpopulation Fund was in need of any donations to push it beyond the required $75,000. For tax years 2007-2009, the charity never received less than $183,000.

Still, the emails expressed departmental concern that manipulating the tax checkoffs in order to stay on the form was a distinct possibility. Using the checkoffs as a fundraising method has become so popular there is now a waiting list for charities to appear on the form. Last session, Rep. Jerry Sonnenberg, R-Sterling, ran a bill to create a tax checkoff for the Unwanted Horse Alliance of Colorado. While the bill passed, there is currently not enough room on the form to accommodate the new checkoff. As a result, the Unwanted Horse Alliance of Colorado became the first tax checkoff to be on a “waiting list” to appear on the tax return.