§ 15-12-1406 — Insulated property, advancement of tax - definitions

Colorado § 15-12-1406

• Jurisdiction: Colorado
• Title 15: Probate,
• Art.: Probate of Wills and Administration

Text

(1) As
used in this section, unless the context otherwise requires:

(a) Advanced fraction means a fraction that has as its numerator the
amount of the advanced tax and as its denominator the value of the interests in
insulated property to which that tax is attributable.

(b) Advanced tax means the aggregate amount of estate tax attributable
to interests in insulated property that is required to be advanced by uninsulated
holders under subsection (3) of this section.

(c) Insulated property means property subject to a time-limited interest
that is included in the apportionable estate but is unavailable for payment of an
estate tax because of impossibility or impracticability.

(d) Uninsulated holder means a person who has an interest in uninsulated
property.

(e) Uninsulated property means property included in the apportionable
estate, other than insulated property.

(2) If estate tax is to be advanced pursuant to subsection (3) of this section
by persons holding interests in uninsulated property subject to a time-limited
interest other than property to which section 15-12-1407 applies, the estate tax
shall be advanced, without further apportionment, from the principal of the
uninsulated property.

(3) Subject to sections 15-12-1409 (2) and 15-12-1409 (4), an estate tax
attributable to interests in insulated property shall be advanced ratably by
uninsulated holders. If the value of an interest in uninsulated property is less than
the amount of estate taxes otherwise required to be advanced by the holder of that
interest, the deficiency shall be advanced ratably by the person holding interests in
any property that is excluded from the apportionable estate as defined in section
15-12-1402 (1)(b) as if those interests were in uninsulated property.

(4) A court having jurisdiction to determine the apportionment of an estate
tax may require a beneficiary of an interest in insulated property to pay all or part
of the estate tax otherwise apportioned to the interest if the court finds that it
would be substantially more equitable for that beneficiary to bear the tax liability
personally than for that part of the tax to be advanced by uninsulated holders.

(5) When a distribution of insulated property is made, each uninsulated
holder may recover from the distributee a ratable portion of the advanced fraction
of the property distributed. To the extent that undistributed insulated property
ceases to be insulated, each uninsulated holder may recover from the property a
ratable portion of the advanced fraction of the total uninsulated property.

(6) Upon a distribution of insulated property for which the distributee
becomes obligated to make a payment to uninsulated holders pursuant to
subsection (4) of this section, a court may award an uninsulated holder a recordable
lien on the distributee's property to secure the distributee's obligation to that
uninsulated holder.

Legislative History

Source: L. 2011: Entire part added, (SB 11-165), ch. 184, p. 704, � 1, effective August 10.