Small Colorado business claims state owes more than $300K in outstanding e-bike tax credit

More than 20,000 Coloradans got a discount on buying an e-bike and that number keeps rising as the state's e-bike tax credit program continues. This year, that credit got cut in half from $450 to $225, but some shops say they're still on the hook for that credit from last year and waiting for the state to pay them back. While many have been paid, some have told CBS Colorado they're still waiting for thousands of dollars.

Daniel Johnson co-owns CyclErie in Erie and he is currently waiting on what he says is more than $300,000 in tax credits from e-bike sales for half of last year.

"I wake up to check every single day. I go to the mailbox five times a day," Johnson said, "Bike shops are traditionally, you know, small independently owned bicycle retailers, mom and pop type organizations, and it's very hard for us to float tens of thousands or more of dollars."

Johnson says he pays for his inventory in full up front, so when customers buy e-bikes with the tax discount, he's floats the money until he files his taxes for that quarter and the state pays him back. Johnson says he supports the program overall, but any delay in repayment puts a strain on business. 

Johnson says he's still waiting on tax credits from Q3 and Q4 of last year, which is his shop's busiest window.

"The Christmas buying season, Black Friday holiday season, so that's when you sell almost all of your bikes for the year, or definitely at least half of them," Johnson said.

The Department of Revenue (DOR) sent a statement about the status of the tax credit program:

"The Department of Revenue cannot comment on any particular taxpayer's account. The electric bicycle income tax credit is earned when a qualified retailer makes a retail sale of a new qualified electric bicycle to a qualified purchaser in the state. To qualify for the credit, the qualified electric bicycle must be sold at retail to, and received by, a qualified purchaser in Colorado. After these conditions for earning the credit are met, the qualified retailer may request advance payment of the credit earned when filing its quarterly report of completed retail sales."

Johnson says the money he's waiting for wasn't an advance, but he still wants it on time.

"I want to give [DOR] as much grace as I can, because I understand how much pressure the Department of Revenue is under from all over. Obviously, as a business owner, I want my money as quickly as possible," says Johnson.

Johnson says more than 90% of his sales are e-bikes and therefore use this tax credit program.

"When someone comes in and looks at that price tag, it definitely incentivizes it, and makes the sale that much easier, and makes them ready to buy," Johnson said.

Now, as Johnson works to expand his business, he says he wants to stay in the program but hopes it becomes more reliable.

"I definitely think there's been a lot of stress, and I think we will look back on this and say that it was worth it."