Updated September 5, 2026. Quick answer: The $10,000 deferral cap most summaries quote for Colorado is actually a different, narrower program for people who don’t otherwise qualify; the main 65-plus deferral has no dollar cap, just a 75% loan-to-value test, and its interest rate resets every year to the 10-year Treasury note rate.
Two Colorado programs, and a commonly-misquoted cap
Colorado runs its deferral under C.R.S. §§39-3.5-101 through -115, open to homeowners 65 or older, or anyone called into military service as of January 1 of the claim year, on a homestead that is generally non-income-producing. This is where a common misunderstanding needs correcting: the roughly $10,000 cap that circulates in secondary summaries of Colorado’s deferral is not a limit on the main 65-plus or military program at all; it belongs to a separate, narrower ‘tax-growth cap’ deferral created in 2021 for homeowners who do not otherwise qualify under the main provision. The primary senior/military deferral itself carries no dollar cap; it is limited only by an equity test, requiring total mortgages and deeds of trust on the property to be no more than 75% of assessed value for the 65-plus deferral, or 90% for the military deferral.
An interest rate that resets every year, and a lien junior to your existing mortgage
Colorado does not fix a flat interest percentage; instead, for every deferral claimed since 2001, interest accrues at whatever rate the most recently issued 10-year U.S. Treasury note carried as of February 1 of that claim year, rounded to the nearest tenth of a percent; a formula that resets annually rather than a number set once in statute. On lien priority, Colorado states the answer twice, in almost identical language each time: the deferred-tax lien attaches on the date its certificate is recorded, is junior to any mortgage or deed of trust recorded before that date, and has priority only over liens attaching after it; meaning a foreclosure on a pre-existing, senior mortgage can extinguish Colorado’s own deferral lien entirely.
When it comes due, and how to apply
The balance becomes due when the taxpayer dies, the property is sold or under contract of sale or has its title transferred, the property stops being the taxpayer’s homestead (with an exception for illness or uninhabitability), the property no longer meets the income-production or equity tests, or a mobile home is relocated. Payment is due 90 days after most of these events, but a full year after death; if it goes unpaid, the state treasurer can foreclose the lien like a judgment lien, though the owner may instead simply convey the property to the state in place of paying. Claims must be filed after January 1 and on or before April 1 each year.
Colorado’s broader senior property-tax picture, covering exemptions, freezes and circuit-breaker credits, not just the deferral: property tax breaks for seniors in Colorado.
How every state’s programme compares: property tax relief for seniors by state. What a deferral means in general, and who it catches out: the property-tax deferral lien trap.
Statutory text read at each state’s own legislature, revisor, or revenue agency this session. General information, not tax or legal advice; rates, caps and thresholds change most years and a county or state agency retains the final say on your own application.