(1) For purposes of this section:
(a) Estate means the gross estate of a decedent as determined for the
purpose of federal estate tax and the estate tax payable to this state.
(b) Fiduciary means personal representative or trustee.
(c) Person means any individual, partnership, association, joint stock
company, corporation, government, political subdivision, governmental agency, or
local governmental agency.
(d) Person interested in the estate means any person entitled to receive, or
who has received, from a decedent or by reason of the death of a decedent any
property or interest therein included in the decedent's estate. It includes a personal
representative, conservator, and trustee.
(e) State means any state, territory, or possession of the United States, the
District of Columbia, and the Commonwealth of Puerto Rico.
(f) Tax means the federal estate tax, the additional inheritance tax
imposed by section 26-2-113, C.R.S., the Colorado estate tax imposed by article
23.5 of title 39, C.R.S., and interest and penalties imposed in addition to the tax.
(2) Unless otherwise provided in the will or other dispositive instrument, the
tax shall be apportioned among all persons interested in the estate, subject to the
exceptions specified in this section. The apportionment is to be made in the
proportion that the value of the interest of each person interested in the estate
bears to the total value of the interests of all persons interested in the estate. The
values used in determining the tax are to be used for tax apportionment purposes.
In all instances not involving a spouse unprovided for in a will as provided in section
15-11-301 or an election by a surviving spouse as provided in section 15-11-202, if the
decedent's will or other dispositive instrument directs a method of apportionment
of tax different from the method described in this code, the method described in
the will or other dispositive instrument controls. In instances involving such a
spouse unprovided for in a will or election, if the decedent's will or other dispositive
instrument directs a method of apportionment of tax different from the method
described in this code, the apportionment of tax to the spouse unprovided for in the
will or to the surviving spouse shall be in accordance with the method described in
this code, and the apportionment of tax to the remaining persons interested in the
estate shall be in accordance with the method described in the will or other
dispositive instrument.
(3) (a) The court in which venue lies for the administration of the estate of a
decedent, on petition for the purpose, may determine the apportionment of the tax.
(b) If the court finds that it is inequitable to apportion interest and penalties
in the manner provided in subsection (2) of this section, because of special
circumstances, it may direct apportionment thereof in the manner it finds equitable.
(c) If the court finds that the assessment of penalties and interest assessed
in relation to the tax is due to delay caused by the negligence of the fiduciary, the
court may charge him with the amount of the assessed penalties and interest.
(d) In any action to recover from any person interested in the estate the
amount of the tax apportioned to the person in accordance with this code, the
determination of the court in respect thereto shall be prima facie correct.
(4) (a) The personal representative or other person in possession of the
property of the decedent required to pay the tax may withhold from any property
distributable to any person interested in the estate, upon its distribution to him, the
amount of tax attributable to his interest. If the property in possession of the
personal representative or other person required to pay the tax and distributable to
any person interested in the estate is insufficient to satisfy the proportionate
amount of the tax determined to be due from the person, the personal
representative or other person required to pay the tax may recover the deficiency
from the person interested in the estate. If the property is not in the possession of
the personal representative or the other person required to pay the tax, the
personal representative or the other person required to pay the tax may recover
from any person interested in the estate the amount of the tax apportioned to the
person in accordance with this section.
(b) If property held by the personal representative is distributed prior to final
apportionment of the tax, the distributee shall provide a bond or other security for
the apportionment liability in the form and amount prescribed by the personal
representative.
(5) (a) In making an apportionment, allowances shall be made for any
exemptions granted, any classification made of persons interested in the estate,
and for any deductions and credits allowed by the law imposing the tax.
(b) Any exemption or deduction allowed by reason of the relationship of any
person to the decedent or by reason of the purposes of the gift inures to the benefit
of the person bearing such relationship or receiving the gift; but, if an interest is
subject to a prior present interest which is not allowable as a deduction, the tax
apportionable against the present interest shall be paid from principal.
(c) Any deduction for property previously taxed and any credit for gift taxes
or death taxes of a foreign country paid by the decedent or his estate inures to the
proportionate benefit of all persons liable to apportionment.
(d) Any credit for inheritance, succession, or estate taxes or taxes in the
nature thereof applicable to property or interests includable in the estate inures to
the benefit of the persons or interests chargeable with the payment thereof to the
extent proportionately that the credit reduces the tax.
(e) To the extent that property passing to or in trust for a surviving spouse or
any charitable, public, or similar gift or devise is not an allowable deduction for
purposes of the tax solely by reason of an inheritance tax or other death tax
imposed upon and deductible from the property, the property is not included in the
computation provided for in subsection (2) of this section, and to that extent no
apportionment is made against the property. The provisions of this paragraph (e) do
not apply to any case if the result would be to deprive the estate of a deduction
otherwise allowable under section 2053(d) of the federal Internal Revenue Code of
1986, as amended, of the United States, relating to deduction for state death taxes
on transfers for public, charitable, or religious uses.
(6) No interest in income and no estate for years or for life or other
temporary interest in any property or fund is subject to apportionment as between
the temporary interest and the remainder. The tax on the temporary interest and
the tax, if any, on the remainder is chargeable against the corpus of the property or
funds subject to the temporary interest and remainder.
(7) Neither the personal representative nor other person required to pay the
tax is under any duty to institute any action to recover from any person interested in
the estate the amount of the tax apportioned to the person until the expiration of
the three months next following final determination of the tax. A personal
representative or other person required to pay the tax who institutes the action
within a reasonable time after the three months' period is not subject to any liability
or surcharge because any portion of the tax apportioned to any person interested in
the estate was collectible at a time following the death of the decedent but
thereafter became uncollectible. If the personal representative or other person
required to pay the tax cannot collect from any person interested in the estate the
amount of the tax apportioned to the person, the amount not recoverable shall be
equitably apportioned among the other persons interested in the estate who are
subject to apportionment.
(8) A personal representative acting in another state or a person required to
pay the tax domiciled in another state may institute an action in the courts of this
state and may recover a proportionate amount of the federal estate tax, of an
estate tax payable to another state, or of a death duty due by a decedent's estate
to another state, from a person interested in the estate who is either domiciled in
this state or who owns property in this state subject to attachment or execution. For
the purposes of the action the determination of apportionment by the court having
jurisdiction of the administration of the decedent's estate in the other state is prima
facie correct.
(9) If the liabilities of persons interested in the estate as prescribed by this
code differ from those which result under the federal estate tax law, the liabilities
imposed by the federal law shall control, and all other provisions of this code shall
apply as if the amounts and liabilities prescribed by the federal law had been
prescribed by subsection (2) of this section.