2020 -- H 7696 | |
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LC004268 | |
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STATE OF RHODE ISLAND | |
IN GENERAL ASSEMBLY | |
JANUARY SESSION, A.D. 2020 | |
____________ | |
A N A C T | |
RELATING TO TAXATION -- ESTATE AND TRANSFER TAXES | |
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Introduced By: Representatives Chippendale, Filippi, Lyle, Price, and Place | |
Date Introduced: February 26, 2020 | |
Referred To: House Finance | |
It is enacted by the General Assembly as follows: | |
1 | SECTION 1. Chapter 44-22 of the General Laws entitled "Estate and Transfer Taxes - |
2 | Liability and Computation" is hereby repealed in its entirety. |
3 | CHAPTER 44-22 |
4 | Estate and Transfer Taxes - Liability and Computation |
5 | 44-22-1. Tax on net estate of decedents -- Additional tax on postponed enjoyment -- |
6 | Deductions -- Marital deduction. |
7 | (a) A tax is imposed upon the transfer of the net estate of every resident or nonresident |
8 | decedent as a tax upon the right to transfer. The tax is imposed at the rate of two percent (2%) |
9 | upon all amounts not in excess of twenty-five thousand dollars ($25,000); at the rate of three |
10 | percent (3%) upon all amounts in excess of twenty-five thousand dollars ($25,000) and not |
11 | exceeding fifty thousand dollars ($50,000); at the rate of four percent (4%) upon all amounts in |
12 | excess of fifty thousand dollars ($50,000) and not exceeding one hundred thousand dollars |
13 | ($100,000); at the rate of five percent (5%) upon all amounts in excess of one hundred thousand |
14 | dollars ($100,000) and not exceeding two hundred fifty thousand dollars ($250,000); at the rate of |
15 | six percent (6%) upon all amounts in excess of two hundred fifty thousand dollars ($250,000) and |
16 | not exceeding five hundred thousand dollars ($500,000); at the rate of seven percent (7%) upon |
17 | all amounts in excess of five hundred thousand dollars ($500,000) and not exceeding seven |
18 | hundred fifty thousand dollars ($750,000); at the rate of eight percent (8%) upon all amounts in |
19 | excess of seven hundred fifty thousand dollars ($750,000) and not exceeding one million dollars |
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1 | ($1,000,000); at the rate of nine percent (9%) upon all amounts in excess of one million dollars |
2 | ($1,000,000). An additional tax is imposed at the rate of two percent (2%) upon all or any part of |
3 | each estate devised, bequeathed, or conveyed in such manner that it becomes necessary to |
4 | postpone the assessment of taxes imposed by this chapter until the person entitled to the estate |
5 | comes into beneficial enjoyment or possession of the estate; and provided, further, that an |
6 | additional tax is not assessed and collected, as provided in §§ 44-23-9 -- 44-23-12, in case a |
7 | settlement of taxes is effected under the provisions of § 44-23-25. |
8 | (b) In computing the value of the net estate in subsection (a) of this section, there is |
9 | deducted from the estate and exempted from the tax twenty-five thousand dollars ($25,000). |
10 | (c) In computing the value of the net estate in subsection (a) of this section, there is |
11 | deducted from the estate and exempted from the tax all property or interests transferred to any |
12 | corporation, association, or institution located in Rhode Island which is exempt from taxation by |
13 | charter or under the laws of this state; or to any corporation, association, or institution located |
14 | outside of this state, which if located within this state, would be exempt from taxation; provided, |
15 | that the state of domicile of the corporation, association, or institution allows a reciprocal |
16 | exemption to any similar Rhode Island corporation, association, or institution; or to any person in |
17 | trust for the same or for use by the same for charitable purposes; or to any city or town in this |
18 | state for public purposes. |
19 | (d) In computing the value of the net estate in subsection (a) of this section, there is |
20 | deducted from the estate and exempted from the tax United States civil and federal military |
21 | service annuity payments. |
22 | (e) In computing the value of the net estate in subsection (a) of this section, there is |
23 | deducted from the estate and exempted from the estate tax a marital deduction, as defined in 26 |
24 | U.S.C. § 2056, in the amount of one hundred seventy-five thousand dollars ($175,000), from |
25 | property or beneficial interests which pass or have passed from the decedent to the surviving |
26 | spouse, but only to the extent that the interests are included in determining the value of the gross |
27 | estate. |
28 | (f)(1) In computing the value of the net estate in subsection (a) of this section, there is |
29 | deducted from the estate and exempted from the estate tax, an orphan's deduction, provided, that: |
30 | (i) the decedent does not have a surviving spouse, and (ii) the decedent is survived by a minor |
31 | child who, immediately after the death of the decedent, has no known parent, an amount equal to |
32 | the value of any interest in property which passes or has passed from the decedent to the child, |
33 | but only to the extent that the interest is included in determining the value of the gross estate. The |
34 | aggregate amount of the deductions allowed under this section (computed without regard to this |
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1 | subsection) with respect to interests in property passing to any minor child shall not exceed an |
2 | amount equal to five thousand dollars ($5,000) multiplied by the excess of twenty-one (21) over |
3 | the age (in years) which the child has attained on the date of the decedent's death. |
4 | (2) For purposes of this subsection, any term used in the subsection has the same meaning |
5 | as when used in a comparable context in 26 U.S.C. § 2057 unless a different meaning is clearly |
6 | required. |
7 | (g) Notwithstanding any other provisions of this chapter, the total estate tax payment on |
8 | account of the estate of a decedent whose death occurs on or after January 1, 1986, is that |
9 | percentage of the estate tax which would be payable under this chapter determined in accordance |
10 | with the following schedule: |
11 | (1) Death prior to January 1, 1987. Ninety percent (90%) in the case of decedents whose |
12 | deaths occur on or after January 1, 1986, and prior to January 1, 1987; |
13 | (2) Death prior to January 1, 1988. Eighty percent (80%) in the case of decedents whose |
14 | deaths occur on or after January 1, 1987, and prior to January 1, 1988; |
15 | (3) Death prior to January 1, 1989. Sixty percent (60%) in the case of decedents whose |
16 | deaths occur on or after January 1, 1988, and prior to January 1, 1989; |
17 | (4) Death prior to January 1, 1990. Forty percent (40%) in the case of decedents whose |
18 | deaths occur on or after January 1, 1989, and prior to January 1, 1990; |
19 | (5) Death prior to June 1, 1990. Twenty percent (20%) in the case of decedents whose |
20 | deaths occur on or after January 1, 1990, and prior to June 1, 1990; |
21 | (6) Death prior to January 1, 1992. Forty percent (40%) in the case of decedents whose |
22 | deaths occur on or after June 1, 1990, and prior to January 1, 1992. |
23 | (7) Death on or after January 1, 1992. The estate tax payable on or account of the estate |
24 | of a decedent whose death occurs on or after January 1, 1992, is determined in accordance with § |
25 | 44-22-1.1. |
26 | (h) The estate tax payable under this section shall in no event be less than the estate tax |
27 | due under § 44-22-1.1, computed without regard to the date of death. |
28 | 44-22-1.1. Tax on net estate of decedent. |
29 | (a)(1) For decedents whose death occurs on or after January 1, 1992, but prior to January |
30 | 1, 2002, a tax is imposed upon the transfer of the net estate of every resident or nonresident |
31 | decedent as a tax upon the right to transfer. The tax is a sum equal to the maximum credit for |
32 | state death taxes allowed by 26 U.S.C. § 2011. |
33 | (2) For decedents whose death occurs on or after January 1, 2002, but prior to January 1, |
34 | 2010, a tax is imposed upon the transfer of the net estate of every resident or nonresident |
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1 | decedent as a tax upon the right to transfer. The tax is a sum equal to the maximum credit for |
2 | state death taxes allowed by 26 U.S.C. § 2011 as it was in effect as of January 1, 2001; provided, |
3 | however, that the tax shall be imposed only if the net taxable estate shall exceed six hundred |
4 | seventy-five thousand dollars ($675,000). Any scheduled increase in the unified credit provided |
5 | in 26 U.S.C. § 2010 in effect on January 1, 2001, or thereafter, shall not apply. |
6 | (3) For decedents whose death occurs on or after January 1, 2010, and prior to January 1, |
7 | 2015, a tax is imposed upon the transfer of the net estate of every resident or nonresident |
8 | decedent as a tax upon the right to transfer. The tax is a sum equal to the maximum credit for |
9 | state death taxes allowed by 26 U.S.C. § 2011 as it was in effect as of January 1, 2001; provided, |
10 | however, that the tax shall be imposed only if the net taxable estate shall exceed eight hundred |
11 | and fifty thousand dollars ($850,000); provided, further, beginning on January 1, 2011, and each |
12 | January 1 thereafter until January 1, 2015, said amount shall be adjusted by the percentage of |
13 | increase in the Consumer Price Index for all Urban Consumers (CPI-U) as published by the |
14 | United States Department of Labor Statistics determined as of September 30 of the prior calendar |
15 | year; said adjustment shall be compounded annually and shall be rounded up to the nearest five |
16 | dollar ($5.00) increment. Any scheduled increase in the unified credit provided in 26 U.S.C. § |
17 | 2010 in effect on January 1, 2003, or thereafter, shall not apply. |
18 | (4) For decedents whose death occurs on or after January 1, 2015, a tax is imposed upon |
19 | the transfer of the net estate of every resident or nonresident decedent as a tax upon the right to |
20 | transfer. The tax is a sum equal to the maximum credit for state death taxes allowed by 26 U.S.C. |
21 | § 2011, as it was in effect as of January 1, 2001; provided, however, that a Rhode Island credit |
22 | shall be allowed against any tax so determined in the amount of sixty-four thousand four hundred |
23 | ($64,400). Any scheduled increase in the unified credit provided in 26 U.S.C. § 2010 in effect on |
24 | January 1, 2003, or thereafter, shall not apply; provided, further, beginning on January 1, 2016, |
25 | and each January 1 thereafter, said Rhode Island credit amount under this section shall be |
26 | adjusted by the percentage of increase in the Consumer Price Index for all Urban Consumers |
27 | (CPI-U) as published by the United States Department of Labor Statistics determined as of |
28 | September 30 of the prior calendar year; said adjustment shall be compounded annually and shall |
29 | be rounded up to the nearest five dollar ($5.00) increment. |
30 | (b) If the decedent's estate contains property having a tax situs not within the state, then |
31 | the tax determined by this section is reduced to an amount determined by multiplying the tax by a |
32 | fraction whose numerator is the gross estate excluding all property having a tax situs not within |
33 | the state at the decedent's death and whose denominator is the gross estate. In determining the |
34 | fraction, no deductions are considered and the gross estate is not reduced by a mortgage or other |
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1 | indebtedness for which the decedent's estate is not liable. |
2 | (c)(1) The terms "gross taxable estate", "federal gross estate" or "net taxable estate" used |
3 | in this chapter or chapter 23 of this title has the same meaning as when used in a comparable |
4 | context in the laws of the United States, unless a different meaning is clearly required by the |
5 | provisions of this chapter or chapter 23 of this title. Any reference in this chapter or chapter 23 of |
6 | this title to the Internal Revenue Code or other laws of the United States means the Internal |
7 | Revenue Code of 1954, 26 U.S.C. § 1 et seq. |
8 | (2) For decedents whose death occurs on or after January 1, 2002, the terms "gross |
9 | taxable estate" "federal gross estate" or "net taxable estate" used in this chapter or chapter 23 of |
10 | this title has the same meaning as when used in a comparable context in the laws of the United |
11 | States, unless a different meaning is clearly required by the provisions of this chapter or chapter |
12 | 23 of this title. Any reference in this chapter or chapter 23 of this title to the Internal Revenue |
13 | Code or other laws of the United States means the Internal Revenue Code of 1954, 26 U.S.C. § 1 |
14 | et seq., as they were in effect as of January 1, 2001, unless otherwise provided. |
15 | (d) All values are as finally determined for federal estate tax purposes. |
16 | (e) Property has a tax situs within the state of Rhode Island: |
17 | (1) If it is real estate or tangible personal property and has actual situs within the state of |
18 | Rhode Island; or |
19 | (2) If it is intangible personal property and the decedent was a resident. |
20 | 44-22-2. Exemption -- Missing persons in military action. |
21 | An estate of a serviceman or servicewoman who has been classified by the armed forces |
22 | of the United States as missing in action is exempt from provisions of this chapter pertaining to |
23 | taxation. |
24 | 44-22-3 -- 44-22-7. Repealed. |
25 | 44-22-8 -- 44-22-11. Repealed. |
26 | 44-22-12 -- 44-22-20. Repealed. |
27 | 44-22-21. Repealed. |
28 | 44-22-22 -- 44-22-24. Repealed. |
29 | 44-22-25. Repealed. |
30 | 44-22-26. [Renumbered.] |
31 |
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32 | SECTION 2. Chapter 44-23 of the General Laws entitled "Estate and Transfer Taxes - |
33 | Enforcement and Collection" is hereby repealed in its entirety. |
34 | CHAPTER 44-23 |
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1 | Estate and Transfer Taxes - Enforcement and Collection |
2 | 44-23-1. Statements filed by executors, administrators and heirs-at-law. |
3 | (a) Every executor, administrator, and heir-at-law, within nine (9) months after the death |
4 | of the decedent, shall file with the tax administrator a statement under oath showing the full and |
5 | fair cash value of the estate, the amounts paid out from the estate for claims, expenses, charges, |
6 | and fees, and the statement shall also provide the names and addresses of all persons entitled to |
7 | take any share or interest of the estate as legatees or distributees of the estate. |
8 | (b) A fee of fifty dollars ($50.00) is paid when filing any statement required by this |
9 | section. All fees received under this section are allocated to the tax administrator for enforcement |
10 | and collection of taxes. |
11 | 44-23-2. Statements filed by trustees. |
12 | Whenever any person during his or her life appoints a trustee, naming that person or |
13 | others as beneficiaries, and providing for the administration of the trust after his or her death, or |
14 | providing for a termination of the trust and a distribution of the trust estate or any part of the trust |
15 | estate at his or her death, any person acting as the trustee or any trustee of property subject to a |
16 | power of appointment, shall, within thirty (30) days after the death of the creator of the trust, or |
17 | within thirty (30) days after the death of the donee of the power file with the tax administrator a |
18 | sworn statement showing: |
19 | (1) The trust agreement, if any; |
20 | (2) The full and fair cash value of the trust estate; |
21 | (3) The extent of the duration of the trust; |
22 | (4) The manner provided for its termination; |
23 | (5) The names and addresses of the beneficiaries of the trust; and |
24 | (6) Any other information relating to the trust, which the tax administrator may deem |
25 | necessary for the proper assessment of the tax on the estate. |
26 | 44-23-3. Extension of time for filing of statement. |
27 | The tax administrator has authority to grant extensions of time corresponding to the |
28 | approved extension granted by the Internal Revenue Service for the filing of federal form 706 |
29 | within which any statement is required to be filed upon written application of the executor, |
30 | administrator, heir-at-law, or trustee desiring an extension, and it is the duty of the executor, |
31 | administrator, heir-at-law, or trustee, to file the statement within the extension of time granted. |
32 | 44-23-4. Declarations under penalties of perjury. |
33 | The oath or affirmation required by the provisions of this chapter as to any report or |
34 | written statement is not required if the report or statement to be sworn to contains or is verified by |
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1 | a written declaration that it is made under the penalties of perjury; and whoever signs or issues |
2 | any report or statement containing or verified by a written declaration is, if the report or statement |
3 | is willfully false, guilty of perjury. |
4 | 44-23-5. Appraisal of estate. |
5 | (a) If any statement filed in accordance with the provisions of this chapter is considered |
6 | to be an erroneous or incomplete statement of the property, real, tangible personal, intangible |
7 | personal, or of any part of the property, of the decedent, the tax administrator shall give notice to |
8 | the executor, administrator, heir-at-law, beneficiary, or trustee filing the statement, to appear |
9 | before the tax administrator for the purpose of examination of and concerning the statement, and |
10 | concerning all matters appertaining to the estate and the value of the estate of the decedent; and if |
11 | the executor, administrator, heir-at-law, beneficiary, or trustee fails to appear after due notice, or |
12 | if after appearance and examination of the executor, administrator, heir-at-law, beneficiary, or |
13 | trustee the tax administrator still considers the statement to be an erroneous or incomplete |
14 | statement, or if the executor, administrator, heir-at-law, beneficiary, or trustee refuses or neglects |
15 | to answer the questions propounded in reference to the statement, the tax administrator may |
16 | appraise the estate. The tax administrator shall give notice by mail to the executor, administrator, |
17 | heir-at-law, beneficiary, or trustee and to all persons known to have a claim or interest in the |
18 | estate or property to be appraised, of the time and place of the appraisal, and the tax administrator |
19 | or his or her authorized agent shall at that time and place appraise the estate or property at its full |
20 | and fair cash value as prescribed in this section; and for that purpose the tax administrator is |
21 | authorized to issue subpoenas and to compel the attendance of witnesses and to take the evidence |
22 | of the witnesses under oath if necessary, concerning the estate or property and the value of the |
23 | estate, and the witnesses shall receive the same fees as those now paid to witnesses subpoenaed to |
24 | attend the superior court. From the appraisal and other proof relating to the estate or property, the |
25 | tax administrator determines the full and fair cash value of the estate or property upon which all |
26 | taxes imposed by chapter 22 of this title are computed and the amount of taxes to which it is |
27 | liable. If no appraisal is made as provided in this section, the tax administrator may determine the |
28 | value of the property upon which all the taxes are computed and the amount of taxes to which it is |
29 | liable. |
30 | (b) Notwithstanding the provisions of subsection 44-23-5(a), all farmland, as such term is |
31 | defined in § 44-27-2, included as part of an estate for purposes of this section and utilized by the |
32 | executor, administrator, heir-at-law, beneficiary or trustee as farmland, shall be appraised at its |
33 | use value according to applicable federal and state law and not at its full and fair cash value. |
34 | 44-23-6. Notice by probate clerk of grant of letters on estate. |
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1 | Every probate clerk shall, within thirty (30) days after the granting of letters testamentary |
2 | or letters of administration upon any estate, notify the tax administrator of the name of the |
3 | decedent, the name and address of the executor, administrator, or trustee appointed, and the |
4 | amount of the bond required by the court; and shall also furnish upon request certified copies of |
5 | documents and any further information from the records and files of his or her office in regard to |
6 | the estate that the tax administrator may from time to time require. |
7 | 44-23-7. Fees of probate clerk. |
8 | The probate clerk furnishing the information required by § 44-23-6 is paid out of any |
9 | money appropriated for expenses of tax administration a fee of fifteen cents ($.15) for every |
10 | hundred words of copy, but the tax administrator may in his or her discretion make copies of the |
11 | documents or of any other records of the probate court. If the copies are found by the probate |
12 | clerk to be correct, the clerk shall certify to their correctness and be paid a fee of twenty-five |
13 | cents ($.25) for each certification. All fees paid to a probate clerk under this section are disposed |
14 | of in the same manner as is provided for the disposition of other probate fees under the provisions |
15 | of chapter 22 of title 33. |
16 | 44-23-8. Estates where no will has been offered or letters granted. |
17 | If upon the decease of a person leaving an estate liable to a tax under the provisions of |
18 | chapter 22 of this title, a will disposing of the estate is not offered for probate or an application |
19 | for administration is not made within three (3) months after the decease, the tax administrator |
20 | may in his or her discretion, with the approval of the attorney general, agree with the persons |
21 | interested in the estate as to the value of the estate and the amount of the tax to be assessed on the |
22 | estate, or the tax administrator may apply to the probate court for the appointment of an |
23 | administrator of the estate, and the probate court upon the application shall appoint an |
24 | administrator of the estate. |
25 | 44-23-9. Assessment and notice of estate tax -- Collection powers -- Lien. |
26 | (a) The tax imposed by § 44-22-1.1 shall be assessed upon the full and fair cash value of |
27 | the net estate determined by the tax administrator as provided in this chapter. Notice of the |
28 | amount of the tax shall be mailed to the executor, administrator, or trustee, but failure to receive |
29 | the notice does not excuse the nonpayment of or invalidate the tax. The tax administrator shall |
30 | receive and collect the assessed taxes in the same manner and with the same powers as are |
31 | prescribed for and given to the collectors of taxes by chapters 7 -- 9 of this title. The tax shall be |
32 | due and payable as provided in § 44-23-16, shall be paid to the tax administrator, and shall be and |
33 | remain a lien upon the estate until it is paid. All executors, administrators, and trustees are |
34 | personally liable for the tax until it is paid. |
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1 | (b) Notwithstanding the provisions of subsection (a) of this section, under no |
2 | circumstances shall the tax administrator issue any notice of deficiency determination for the |
3 | amount of the estate tax due more than ten (10) years after the return was filed or should have |
4 | been filed, nor shall the tax administrator commence any collection action for any estate tax due |
5 | and payable unless the collection action is commenced within ten (10) years after the date a |
6 | notice of deficiency determination became a final collectible assessment. "Collection action" |
7 | refers to any activity undertaken by the division of taxation to collect on any state tax liabilities |
8 | that are final, due, and payable under Rhode Island law. "Collection action" may include, but is |
9 | not limited to, any civil action involving a liability owed under chapters 22 and 23 of title 44. |
10 | (c) The ten-year (10) limitation shall not apply to the renewal or continuation of the |
11 | state's attempt to collect a liability that became final, due, and payable within the ten-year (10) |
12 | limitation periods set forth in this section. |
13 | 44-23-9.1. Hearing by tax administrator on application. |
14 | An executor, administrator, trustee, legatee or other person aggrieved by a final |
15 | assessment of the tax administrator as to the amount of the tax imposed by chapter 22 of this title |
16 | on any estate or any part of the estate shall notify the tax administrator, in writing, within thirty |
17 | (30) days from the date of mailing by the tax administrator of the notice of the final assessment or |
18 | date tax is due, whichever is later, and shall request a hearing relative to the tax; and the tax |
19 | administrator shall, as soon as practicable, fix a time and place for the hearing and shall, after the |
20 | hearing, determine the correct amount of the tax, interest, and penalties. |
21 | 44-23-10. Deposit with tax administrator to cover taxes. |
22 | An executor, administrator, or trustee may deposit with the tax administrator a sum of |
23 | money sufficient in the opinion of the tax administrator to pay all taxes, which may become due |
24 | under the provisions of chapter 22 of this title. When the taxes have been determined, the general |
25 | treasurer shall, upon certification by the tax administrator and with the approval of the controller, |
26 | repay to the executor, administrator, or trustee the difference between the determined taxes and |
27 | the amount deposited, or the tax administrator shall collect any deficiency in the tax. The lien |
28 | upon the estate imposed under § 44-23-9 is discharged by the acceptance of the deposit. |
29 | 44-23-11. Tentative assessment. |
30 | At the request of an executor, administrator, or trustee the tax administrator may make a |
31 | tentative assessment of taxes under the provisions of §§ 44-22-1 and 44-22-1.1, whichever |
32 | section is in effect at the time, to prevent interest charges on the amount of the tentative |
33 | assessment, and shall accept payment of that sum, and when the taxes have been finally |
34 | determined, the general treasurer shall, upon certification by the tax administrator and with the |
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1 | approval of the controller, repay to the executor, administrator, or trustee the difference between |
2 | the taxes so determined and the amount of the tentative assessment, or the tax administrator shall |
3 | collect any deficiency in the taxes together with interest on the deficiency, if any is due. |
4 | 44-23-12. Recording of lien against real estate -- Discharge. |
5 | Whenever a statement is filed with the tax administrator showing the ownership of real |
6 | property, the tax administrator shall notify the recorder of deeds or the clerk of the city or town, |
7 | as the case may be, in which the real property is located, and the recorder of deeds shall note in |
8 | the land records of his or her office the decedent's name, and the fact that all real property |
9 | belonging to the decedent is impressed with a lien under the provisions of this chapter. Upon the |
10 | discharge of the lien, the tax administrator shall send the recorder of deeds a further notice |
11 | showing the discharge and the manner of the discharge. The recorder of deeds is paid out of any |
12 | money appropriated for expenses of tax administration, a fee of one dollar and fifty cents ($1.50) |
13 | for a completed entry. |
14 | 44-23-13. Assessment and notice of transfer tax -- Collection powers -- Lien on |
15 | property. |
16 | (a) All taxes imposed by § 44-22-1.1 shall be assessed by the tax administrator upon the |
17 | full and fair cash value of the property transferred at the rates described in chapter 22 of this title |
18 | and only upon the amount in excess of the exemptions or deductions specified in that chapter, to |
19 | be paid to the tax administrator, and all executors, administrators, or trustees are personally liable |
20 | for any and all taxes until they are paid. Notice of the amount of the taxes shall be mailed to the |
21 | executor, administrator or trustee liable for the taxes, and upon request made to the tax |
22 | administrator to any other person by whom the taxes are payable, but failure to receive the notice |
23 | does not excuse the nonpayment of or invalidate the taxes. Unless appeal is taken from the |
24 | assessment, as provided in this chapter, the amount of assessed taxes is final. |
25 | (b) The tax administrator shall receive and collect the assessed taxes in the manner and |
26 | with the powers prescribed and given to the collectors of taxes by chapters 7 -- 9 of this title. |
27 | Payment of the certified amount is a discharge of the tax. |
28 | (c) The taxes are and remain a lien upon the property transferred, and upon all property |
29 | acquired by the executor, administrator or trustee in substitution for the property while that |
30 | property remains in his or her hands until the taxes are paid, but the lien does not affect any |
31 | tangible personal property or intangible personal property after it has passed to a bona fide |
32 | purchaser for value. Nothing contained in this section gives the owner of any securities specified |
33 | in § 44-23-34 the right to have the securities transferred to the owner by the corporation, |
34 | association, company or trust issuing the securities, until the permit required by § 44-23-34 has |
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1 | been filed as provided in § 44-23-34. |
2 | 44-23-14. Discharge of lien on real estate -- Liability of heir or devisee. |
3 | The lien imposed under § 44-23-13 upon any real estate or separate parcel of real estate |
4 | may be discharged by the payment of all taxes due and to become due upon the real estate or |
5 | separate parcel, or by an order of the tax administrator transferring the lien to other real estate |
6 | owned by the person to whom the real estate or separate parcel of the real estate passes, or by the |
7 | acceptance of the surety for the payment of taxes which the tax administrator may approve. The |
8 | heir, devisee, or other donee is personally liable for the tax on the real estate, as well as the |
9 | executor, administrator, or trustee; and if the executor, administrator, or trustee pays the tax he or |
10 | she shall, unless the tax is made an expense of administration by the will or other instrument of |
11 | the decedent, have the right to recover the tax from the heir, devisee, or other donee of the real |
12 | estate. |
13 | 44-23-15. Taxes as debt to state. |
14 | The taxes imposed under the provisions of chapter 22 of this title, together with all |
15 | penalties, charges and interest shall also become, from the time the taxes are due and payable, a |
16 | debt to the state of Rhode Island from the person or corporation liable for the payment of the |
17 | taxes. |
18 | 44-23-16. Time taxes due -- Interest and additions to tax on delinquent payments. |
19 | All taxes imposed by chapter 22 of this title, unless provided, are due and payable nine |
20 | (9) months after the date of death of the decedent. If the taxes are not paid within nine (9) months |
21 | from the date of death, interest shall be charged and collected at the annual rate provided by § 44- |
22 | 1-7 from the time the tax is due, determined without regard to any extension of time for payment. |
23 | In addition, if the taxes are not paid when due (determined with regard to any extension of time |
24 | for payment), there is added to the amount of tax due five-tenths percent (0.5%) of the tax per |
25 | month to a maximum of twenty-five percent (25%) unless it is shown that the failure to pay is due |
26 | to reasonable cause and not due to willful neglect. |
27 | 44-23-16.1. Interest on overpayments. |
28 | If it is determined that any overpayment has been made with respect to taxes imposed by |
29 | chapter 22 of this title, the amount of the overpayment bears interest at the annual rate established |
30 | by § 44-1-7.1. The acceptance of the check shall be without prejudice to any right of the taxpayer |
31 | to claim any additional overpayment and interest. |
32 | 44-23-17. Suspension of tax payment pending claim against estate. |
33 | Whenever it is necessary in the settlement of any estate to retain property or funds for the |
34 | purpose of paying the claim of any creditor, the amount or validity of which is contested and is |
| LC004268 - Page 11 of 25 |
1 | not determined, the payment of the whole or a proportionate part of the tax may be suspended, by |
2 | and with the approval of the tax administrator, to await the disposition of the claim. |
3 | 44-23-18. Extension of time for payment of additional estate tax. |
4 | Whenever the tax administrator finds that the payment of the tax imposed by § 44-22-1.1 |
5 | causes undue hardship, the tax administrator may, in his or her discretion, with the approval of |
6 | the attorney general and by agreement with the executor, administrator, or trustee, extend the time |
7 | for payment of the whole or any part of the tax for a period not to exceed four (4) years from the |
8 | date the tax is due and payable, and may provide for payment in installments. In that case the |
9 | amount in respect of which the extension is granted shall be paid with or without interest, on or |
10 | before the date of the expiration of the period of the extension. |
11 | 44-23-19 -- 44-23-22. Repealed. |
12 | 44-23-23. Sale of property to pay tax. |
13 | Every executor, administrator, or trustee has full power to sell, upon application to the |
14 | probate court, so much of the property of the decedent as will enable him or her to pay any tax |
15 | imposed by chapter 22 of this title in the manner he or she might be entitled by law to do for the |
16 | payment of the debts of the testator or intestate. |
17 | 44-23-24. Refusal to furnish information or obey subpoena. |
18 | If any executor, administrator, heir-at-law, or trustee, probate clerk or other person |
19 | neglects or refuses to file any statement as required by the provisions of this chapter, or to furnish |
20 | any other information required by this chapter, or neglects or refuses to comply with any |
21 | subpoena issued under the authority of § 44-23-5, the tax administrator may apply to the sixth |
22 | (6th) division of the district court, upon proof by affidavit of the neglect or refusal, for an order |
23 | returnable in not less than two (2) nor more than five (5) days, directing the person charged in the |
24 | affidavit with the neglect or refusal to show cause before the judge who made the order, or any |
25 | other judge of the court, why the person should not be adjudged in contempt. Upon the return of |
26 | the order, the judge before whom the matter is brought for a hearing shall examine the person |
27 | under oath, and the person shall be given an opportunity to be heard. If the judge determines that |
28 | the person has without reasonable cause been guilty of the neglect or refusal complained of, the |
29 | judge may immediately commit the offender to the adult correctional institutions, to remain there |
30 | until the offender submits to file the statement required or to furnish the information required, or |
31 | to obey the subpoena, as the case may be, or is discharged according to law, or the judge may |
32 | make any other order in the premises that the circumstances of the case may seem to the judge to |
33 | require, and may from time to time alter, amend or suspend any order entered by the judge under |
34 | this section. Notwithstanding anything contained in this section or in § 44-23-5, whenever any |
| LC004268 - Page 12 of 25 |
1 | executor, administrator, heir-at-law, trustee, or other person liable for any tax imposed under the |
2 | provisions of chapter 22 of this title, refuses or neglects to furnish any information which in the |
3 | opinion of the tax administrator is necessary for the proper computation of the taxes payable |
4 | under that chapter, after having been requested so to do, the tax administrator may in his or her |
5 | discretion assess and collect the taxes at the highest rate at which they could in any event be |
6 | computed. A party aggrieved by an order of the court may appeal the order to the supreme court |
7 | in accordance with the procedures contained in the rules of appellate procedure of the supreme |
8 | court. |
9 | 44-23-25. Settlement of taxes due. |
10 | The tax administrator, with the approval of the attorney general, may effect a settlement |
11 | of the amount of any taxes imposed by chapter 22 of this title as they deem to be for the best |
12 | interests of the state, and the payment of amount agreed upon is a full satisfaction of the taxes; |
13 | provided, that the settlement and assessment are made only with the consent of the executor of |
14 | the will or the trustee under the other instrument, or, in the case of a transfer by will of real estate, |
15 | of the persons entitled to the real estate, or, if the real estate passes to a trustee for those persons, |
16 | then of the trustee. The settlement, in accordance with the provisions of this section, of a tax upon |
17 | any transfer of property subject to a power of appointment, if the agreement of settlement |
18 | provides, precludes the assessment under this chapter or under any act hereafter passed of any |
19 | further tax, with respect to the right to transfer, upon or with respect to the transfer of any |
20 | property at the time subject to the power, as a part of the estate of the donee of the power. The |
21 | agreement is binding upon all persons taking property subject to the tax, except for fraud or |
22 | manifest error; and executors and trustees are expressly authorized to enter into an agreement |
23 | unless a contrary intention appears in the instrument defining their powers. |
24 | 44-23-26. Adjustment of clerical or palpable errors. |
25 | Whenever a clerical or palpable error or mistake has been made in any statement filed |
26 | with the tax administrator under the provisions of this chapter concerning any matter of |
27 | information, or in entering amounts or figures, the tax administrator may assess an additional tax |
28 | and receive and collect the tax. In the event that the error or mistake has resulted in an over |
29 | assessment, and in case the tax has already been paid to the tax administrator the general treasurer |
30 | shall, upon certification by the tax administrator and with the approval of the controller, refund |
31 | any overpayment to the executor, administrator, heir-at-law, or trustee, or to the person by whom |
32 | the tax was paid, without any further act or resolution making appropriation for the refund; |
33 | provided, that not more than four (4) years have elapsed from the payment of the tax. |
34 | 44-23-27. Conflict of laws as to domicile -- Definition of terms. |
| LC004268 - Page 13 of 25 |
1 | When used in §§ 44-23-27 -- 44-23-32 the following terms have the following meanings: |
2 | (1) "Death tax" means any tax levied by a state on account of the transfer or shifting of |
3 | economic benefits in property at death, or in contemplation of death, or intended to take effect in |
4 | possession or enjoyment at or after death, whether denominated an "inheritance tax," "transfer |
5 | tax," "succession tax," "estate tax," "death duty," "death dues," or otherwise; |
6 | (2) "Executor" means any executor of the will or administrator of the estate of a decedent, |
7 | except an ancillary administrator; |
8 | (3) "Interested person" means any person who may be entitled to receive or who has |
9 | received any property or interest which may be required to be considered in computing the death |
10 | tax of any state involved; |
11 | (4) "Taxing official" means the tax administrator in this state, and in any other reciprocal |
12 | state the officer or body designated in the statute of the state substantially similar to §§ 44-23-27 - |
13 | - 44-23-32. |
14 | 44-23-28. Election to invoke remedy as to conflict of laws. |
15 | (a) In any case in which this state and one or more other states each claim that it was the |
16 | domicile of a decedent at the time of his or her death, and no judicial determination of domicile |
17 | for death tax purposes has been made in any of those states, any executor or the taxing official of |
18 | any of those states, may elect to invoke the provisions of §§ 44-23-27 -- 44-23-32. The election is |
19 | evidenced by sending a notice by registered or certified mail, receipt requested, to the taxing |
20 | officials of each of those states and to each executor, ancillary administrator and interested |
21 | person. |
22 | (b) Any executor may reject the election by sending a notice by registered or certified |
23 | mail, receipt requested, to the taxing officials involved and to all other executors within forty (40) |
24 | days after the receipt of the notice of election. If the election is rejected, no further proceedings |
25 | shall be had under §§ 44-23-27 -- 44-23-32. If the election is not rejected, the dispute as to the |
26 | death taxes shall be determined solely as provided in this chapter, and no other proceedings to |
27 | determine or assess the death taxes shall be instituted in the courts of this state or otherwise. |
28 | 44-23-29. Agreement as to amount due when domicile is in question -- Adjustment |
29 | for credits against federal tax. |
30 | In any case in which an election is made as provided in § 44-23-28 and not rejected, the |
31 | tax administrator may enter into a written agreement with the other taxing officials involved and |
32 | with the executors, to accept a certain sum in full payment of any death tax, together with interest |
33 | and penalties, that may be due this state; provided, that the agreement also fixes the amount to be |
34 | paid the other state or states. If an agreement cannot be reached and the arbitration proceeding |
| LC004268 - Page 14 of 25 |
1 | specified in § 44-23-30 is commenced, and thereafter an agreement is arrived at, a written |
2 | agreement may be entered into at any time before the proceeding is concluded notwithstanding |
3 | the commencement of the proceeding. Upon the filing of the agreement or duplicate of it with the |
4 | authority which would have jurisdiction to assess the death tax of this state if the decedent died |
5 | domiciled in this state, an assessment shall be made as provided in the agreement. The |
6 | assessment, except as hereinafter provided, shall finally and conclusively fix and determine the |
7 | amount of death tax due this state. In the event that the aggregate amount payable under the |
8 | agreement to the states involved is less than the maximum credit allowable to the estate against |
9 | the United States estate tax imposed with respect to the tax, the executor shall also immediately |
10 | pay to the taxing administrator that percentage of the difference between the aggregate amount |
11 | and the amount of the credit, which the amount payable to the taxing administrator under the |
12 | agreement bears to the aggregate amount. |
13 | 44-23-30. Interstate arbitration as to domicile. |
14 | If in any case it appears that an agreement cannot be reached as provided in § 44-23-29, |
15 | or if one year has elapsed from the date of the election without an agreement having been |
16 | reached, the domicile of the decedent at the time of his or her death shall be determined solely for |
17 | death tax purposes as follows: |
18 | (1) Where only this state and one other state are involved, the taxing administrator and |
19 | the taxing official of the other state shall each appoint a member of a board of arbitration, and the |
20 | appointed members shall select the third member of the board. If this state and more than one |
21 | other state are involved, the taxing officials of the states shall agree upon the authorities charged |
22 | with the duty of administering death tax laws in three (3) states not involved, each of which |
23 | authorities shall appoint a member of the board. The members of the board shall elect one of their |
24 | number as chairperson. |
25 | (2) The board shall hold hearings at those places as are deemed necessary, upon |
26 | reasonable notice to the executors, ancillary administrators, all other interested persons, and the |
27 | taxing officials of the states involved, all of whom are entitled to be heard. |
28 | (3) The board has the power to administer oaths, take testimony, subpoena and require |
29 | the attendance of witnesses and the production of books, papers and documents and issue |
30 | commissions to take testimony. Subpoenas may be issued by any member of the board. Failure to |
31 | obey a subpoena may be punished by a judge or justice of any court of record in the same manner |
32 | as if the subpoena had been issued by the judge or justice or by the court in which the judge or |
33 | justice functions. |
34 | (4) The board shall apply, whenever practicable, the rules of evidence which prevail in |
| LC004268 - Page 15 of 25 |
1 | federal courts under the federal rules of civil procedure at the time of hearing. |
2 | (5) The board shall, by majority vote, determine the domicile of the decedent at the time |
3 | of his or her death. The determination is final and conclusive, and binds this state and all its |
4 | judicial and administrative officials on all questions concerning the domicile of the decedent for |
5 | death tax purposes. |
6 | (6) The reasonable compensation and expenses of the members of the board and |
7 | employees of the board shall be agreed upon among the members, the taxing officials of the states |
8 | involved, and the executors. In the event an agreement cannot be reached, the compensation and |
9 | expenses shall be determined by the appropriate probate court of the state determined to be the |
10 | domicile. The amount is borne by the estate and is deemed an administration expense. |
11 | (7) The determination of the board and the record of its proceedings shall be filed with |
12 | the authority having jurisdiction to assess the death tax in the state determined to be the domicile |
13 | of the decedent and with the authorities which would have had jurisdiction to assess the death tax |
14 | in each of the other states involved if the decedent had been found to be domiciled in that state. |
15 | 44-23-31. Interest on tax pending arbitration of domicile. |
16 | In any case where it is determined by the board of arbitration referred to in § 44-23-30 |
17 | that the decedent died domiciled in this state, penalties and interest for nonpayment of the tax, |
18 | between the date of the election and the final determination of the board, shall not exceed, in the |
19 | aggregate, four percent (4%) of the amount of the taxes per annum. |
20 | 44-23-32. Reciprocal laws required. |
21 | The provisions of §§ 44-23-27 -- 44-23-31 apply only to cases in which each of the states |
22 | involved has in effect a law substantially similar to those sections. |
23 | 44-23-33. Appeals. |
24 | Appeals from administrative orders or decisions made pursuant to any provisions of this |
25 | chapter are to the sixth (6th) division district court pursuant to chapter 8 of title 8. The taxpayer's |
26 | right to appeal under this section is expressly made conditional upon prepayment of all taxes, |
27 | interest, and penalties unless the taxpayer moves for and is granted an exemption from the |
28 | prepayment requirements pursuant to § 8-8-26. |
29 | 44-23-34. Permit required for transfer of securities of resident decedent. |
30 | No banking association organized under the laws of the United States and located within |
31 | this state, no corporation incorporated within this state, and no incorporated association or joint |
32 | stock company or business trust having certificates representing shares of stock and carrying on |
33 | business in this state, shall record a transfer of its stock made by any executor, administrator, or |
34 | trustee of a resident decedent or issue a new certificate for any share of its stock at the instance of |
| LC004268 - Page 16 of 25 |
1 | the executor, administrator, or trustee, until a permit authorizing the transfer is issued by the tax |
2 | administrator and filed with the corporation, association, company or trust. Any corporation, |
3 | association, company, or trust making a transfer before a permit authorizing the transfer is issued |
4 | is liable for the amount of any tax which may be assessed on account of the bequest or gift of the |
5 | stock, bond or other evidence of indebtedness, together with its interest, to be collected in an |
6 | action brought in the name of the tax administrator. |
7 | 44-23-35. Statement required as to delivery of decedent's property to other than |
8 | administrator. |
9 | No person having in possession or under control of property forming a part of the estate |
10 | of a resident decedent, as provided in this chapter, may deliver or transfer the property to any |
11 | person other than the executor, administrator, or trustee of the decedent unless the person making |
12 | delivery or transfer of the property immediately furnishes the tax administrator with a statement |
13 | under oath describing the property delivered or transferred together with the name of the person |
14 | to whom the property is delivered or transferred; provided, that any insurance company engaging |
15 | in the business of writing contracts of insurance in the state notifies the tax administrator of the |
16 | amount of any payment or payments made, or to be made to any person or persons under any |
17 | insurance contract, as a result of the death of a Rhode Island resident, whenever the total amount |
18 | of payment or payments made or to be made to the person or persons exceeds fifty thousand |
19 | dollars ($50,000); and provided, that banks and other institutions having deposits standing in the |
20 | joint names of two (2) or more persons, or standing in the joint names of two (2) or more persons |
21 | and payable to either or the survivor or survivors, are not required to furnish the statement with |
22 | respect to deposits of one thousand dollars ($1,000) or less. In the case of deposits of over one |
23 | thousand dollars ($1,000), the bank or other institution, having knowledge of the decease of one |
24 | of the persons in whose names the deposit stands, or upon request of the tax administrator, shall, |
25 | in lieu of the statement furnish a certificate showing the amount of each deposit together with the |
26 | names of the persons in whose names the deposit stands. Any person who makes delivery or |
27 | transfer without furnishing a statement is liable for the amount of any tax which may be assessed |
28 | on account of the transfer of the property, together with its interest, to be collected in an action |
29 | brought in the name of the tax administrator. |
30 | 44-23-36. Payment of tax as prerequisite for allowance of final account. |
31 | The final account of an executor, administrator, or trustee shall not be allowed by the |
32 | court having jurisdiction of the estate unless the account shows, and the court finds, that all taxes |
33 | imposed under the provisions of chapter 22 of this title upon any property or interest in property |
34 | belonging to the estate to be settled by the account and then payable have been paid, that the |
| LC004268 - Page 17 of 25 |
1 | payment of the taxes has been extended, or that the property or any interest in property is not |
2 | liable for any tax imposed under chapter 22 of this title. The receipt of the tax administrator for |
3 | the amount of the tax is conclusive as to the payment of the tax to the extent of the receipt, and |
4 | the certification of the tax administrator that an estate, property, or interest is not liable for any |
5 | tax imposed by chapter 22 of this title is conclusive of that fact. |
6 | 44-23-37. Applicability of enforcement provisions. |
7 | Sections 44-23-1 -- 44-23-8, 44-23-17, 44-23-23, 44-23-24, and 44-23-33 -- 44-23-36 |
8 | apply to the tax imposed under the provisions of § 44-22-1 or 44-22-1.1, whichever is in effect at |
9 | the time. |
10 | 44-23-38. Termination of lien. |
11 | Any other provision of this or chapter 22 of this title to the contrary notwithstanding, a |
12 | lien created by those chapters ceases to be a lien upon or enforceable against real estate upon the |
13 | expiration of a period of ten (10) years from and after the death of the person whose act, failure to |
14 | act, or death gave rise to the lien, regardless of the date of death. |
15 | 44-23-39. Proof of payment of domiciliary tax by administrator of nonresident. |
16 | At any time before the expiration of eighteen (18) months after the appointment in any |
17 | probate court of this state of an executor of the will, or administrator of the estate of, any |
18 | nonresident decedent, the executor or administrator shall file with the probate court proof that all |
19 | death taxes, together with interest, or penalties attached to or in connection with the death taxes, |
20 | which are due to the state of domicile of the decedent, or to any of its political subdivisions, have |
21 | been paid or secured, or that no taxes, interest, or penalties are due, as the case may be; provided, |
22 | that the filing of the proof is not required if it appears that letters testamentary have been issued in |
23 | the state of domicile. The proof may be in the form of a certificate issued by the official or body |
24 | charged with the administration of the death tax laws of the state of domicile. |
25 | 44-23-40. Information furnished to foreign tax officials. |
26 | If the proof is not filed with a probate court in this state as provided by § 44-23-39, the |
27 | clerk of the probate court shall immediately notify by mail the official or body of the state of |
28 | domicile charged with the administration of the death tax laws of that state with respect to the |
29 | estate, and shall present in the notification, so far as is known to the clerk: (1) the name, date of |
30 | death and last domicile of the decedent; (2) the name and address of the executor or |
31 | administrator; (3) a summary of the values of the real estate, tangible personalty, and intangible |
32 | personalty, wherever situated, belonging to the decedent at the time of his or her death; and (4) |
33 | the fact that the executor or administrator has not previously filed the proof required by § 44-23- |
34 | 39. The clerk shall also attach to the notification a copy of the will of the decedent, if the |
| LC004268 - Page 18 of 25 |
1 | decedent died testate, or if the decedent died intestate, a list of his or her heirs and next of kin, so |
2 | far as is known to the clerk. For each copy of the notice, the probate clerk furnishing the |
3 | information shall be paid out of any money appropriated for expenses of tax administration the |
4 | fees provided in § 44-23-7. |
5 | 44-23-41. Accounting on petition by foreign tax official. |
6 | Within sixty (60) days after the mailing of the notice, the official or body charged with |
7 | the administration of the death tax laws of the state of domicile may file with the probate court in |
8 | this state a petition for an accounting in the estate. The official or body of the state of domicile is, |
9 | for the purposes of this chapter, a party in interest for the purpose of petitioning the probate court |
10 | for the accounting. If the petition is filed within the period of sixty (60) days, the probate court |
11 | shall decree the accounting, and upon the accounting being filed and approved shall decree the |
12 | remission to the fiduciary appointed by the probate court of the state of domicile of the balance of |
13 | the intangible personal property after the payment of creditors and expenses of administration in |
14 | this state. |
15 | 44-23-42. Noncompliance by administrator of nonresident -- "State" defined. |
16 | Failure to comply with any of the provisions of §§ 44-23-39 -- 44-23-41 bars any |
17 | executor or administrator from the right to a final accounting or discharge in any probate court in |
18 | this state. The word "state" for the purposes of §§ 44-23-39 -- 44-23-41 includes any territory of |
19 | the United States, the District of Columbia, and any foreign country. |
20 | 44-23-43. Reciprocal laws required -- Liberal construction -- Remission of intangible |
21 | property. |
22 | The provisions of §§ 44-23-39 -- 44-23-42 apply to the estate of a nonresident decedent |
23 | whenever the laws of the state of domicile of the decedents contain a provision, of any nature or |
24 | however expressed, where this state is given reasonable assurance of the collection of its death |
25 | taxes, interest and penalties, from the estates of decedents dying domiciled in this state but whose |
26 | estates are being administered by a court having probate jurisdiction in the other state; or |
27 | whenever the state of domicile does not grant letters testamentary or of administration in |
28 | nonresident estates until after the letters have been issued by the state of domicile. The provisions |
29 | are liberally construed in order to ensure that the state of domicile of any decedent receives any |
30 | death taxes, which may be due it, together with interest and penalties. Nothing in those sections |
31 | shall be construed to prevent a probate court from ordering the remission of any intangible |
32 | personal property belonging to a nonresident decedent whose estate is being administered in this |
33 | state, and the probate court is authorized to order the remission whenever good cause is shown. |
34 | 44-23-44. Exercise of statutory power. |
| LC004268 - Page 19 of 25 |
1 | Whenever in this chapter or chapter 22 of this title any reference is made to any power or |
2 | duty of the tax administrator, the reference shall be construed to mean that the power or duty is |
3 | exercised by the tax administrator or by his or her authorized agent, under the supervision and |
4 | direction of the director of revenue. Whenever in this chapter or chapter 22 of this title any |
5 | reference is made to any power or duty of the controller, the reference shall be construed to mean |
6 | that the power or duty is exercised by the controller or by his or her authorized agent, under the |
7 | supervision and direction of the director of revenue. |
8 | 44-23-45. Liberal construction -- Incidental powers. |
9 | The provisions of this chapter and chapter 22 of this title shall be interpreted and |
10 | construed liberally in order to accomplish the purpose of those chapters, and the tax administrator |
11 | has, in addition to the powers in those chapters specified, mentioned and indicated, all additional |
12 | implied and incidental powers which may be proper and necessary to effect and carry out, |
13 | perform and execute all the powers specified, mentioned and indicated in those chapters. |
14 | 44-23-46. Severability. |
15 | If any clause, sentence, paragraph, section, or part of this chapter and chapter 22 of this |
16 | title is for any reason adjudged by any court of competent jurisdiction to be invalid, that judgment |
17 | does not affect, impair or invalidate any other portion of those chapters which can be given |
18 | reasonable effect without the part adjudged invalid. |
19 | SECTION 3. Chapter 44-23.1 of the General Laws entitled "Uniform Estate Tax |
20 | Apportionment" is hereby repealed in its entirety. |
21 | CHAPTER 44-23.1 |
22 | Uniform Estate Tax Apportionment |
23 | 44-23.1-1. Definitions. |
24 | In this chapter: |
25 | (1) "Estate" means the gross estate of a decedent as determined for the purpose of federal |
26 | estate tax and the estate and transfer taxes payable as provided by this title; |
27 | (2) "Fiduciary" means executor, administrator of any description, and trustee; |
28 | (3) "Person" means any individual, partnership, association, joint stock company, |
29 | corporation, government, political subdivision, governmental agency, or local governmental |
30 | agency; |
31 | (4) "Person interested in the estate" means any person, including a personal |
32 | representative, guardian, or trustee, entitled to receive, or who has received, from a decedent |
33 | while alive or by reason of the death of a decedent any property or interest in property included in |
34 | the decedent's taxable estate; |
| LC004268 - Page 20 of 25 |
1 | (5) "State" means any state, territory, or possession of the United States, the District of |
2 | Columbia, or the Commonwealth of Puerto Rico; and |
3 | (6) "Tax" means the federal estate tax and the estate and transfer taxes payable as |
4 | provided by this title and interest and penalties imposed in addition to the tax. |
5 | 44-23.1-2. Apportionment. |
6 | Unless the will provides, the tax is apportioned among all persons interested in the estate. |
7 | The apportionment is made in the proportion that the value of the interest of each person |
8 | interested in the estate bears to the total value of the interests of all persons interested in the |
9 | estate. The values used in determining the tax are used for that purpose. |
10 | 44-23.1-3. Procedure for determining apportionment. |
11 | (a) The court having jurisdiction over the administration of the estate of a decedent |
12 | determines the apportionment of the tax. If there are no probate proceedings, the superior court of |
13 | the county where the decedent was domiciled at death determines the apportionment of the tax |
14 | upon the application of the person required to pay the tax. |
15 | (b) If the court finds that it is inequitable to apportion interest and penalties in the manner |
16 | provided in this chapter because of special circumstances, it may direct apportionment in the |
17 | manner it finds equitable. |
18 | (c) The expenses reasonably incurred by any fiduciary and by other persons interested in |
19 | the estate in connection with the determination of the amount and apportionment of the tax are |
20 | apportioned as provided in § 44-23.1-2 and charged and collected as a part of the tax apportioned. |
21 | If the court finds it is inequitable to apportion the expenses as provided in § 44-23.1-2, it may |
22 | direct apportionment of the expenses equitably. |
23 | (d) If the court finds that the assessment of penalties and interest assessed in relation to |
24 | the tax is due to delay caused by the negligence of the fiduciary, the court may charge the |
25 | fiduciary with the amount of the assessed penalties and interest. |
26 | (e) In any suit or judicial proceeding to recover from any person interested in the estate |
27 | the amount of the tax apportioned to the person in accordance with this chapter, the determination |
28 | of the court in respect to the tax is prima facie correct. |
29 | 44-23.1-4. Method of proration. |
30 | (a) The fiduciary or other person required to pay the tax may withhold from any property |
31 | of the decedent in his or her possession, distributable to any person interested in the estate, the |
32 | amount of tax attributable to his or her interest. If the property in possession of the fiduciary or |
33 | other person required to pay the tax and distributable to any person interested in the estate is |
34 | insufficient to satisfy the proportionate amount of the tax determined to be due from the person, |
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1 | the fiduciary or other person required to pay the tax may recover the deficiency from the person |
2 | interested in the estate. If the property is not in the possession of the fiduciary or other person |
3 | required to pay the tax, the fiduciary or the other person required to pay the tax may recover from |
4 | any person interested in the estate the amount of the tax apportioned to the person in accordance |
5 | with this chapter. |
6 | (b) If property held by the fiduciary or other person is distributed prior to final |
7 | apportionment of the tax, the fiduciary or other person may require the distributee to provide a |
8 | bond or other security for the apportionment liability in the form and amount prescribed by the |
9 | fiduciary, with the approval of the court having jurisdiction of the administration of the estate. |
10 | 44-23.1-5. Allowance for exemptions, deductions, and credits. |
11 | (a) In making an apportionment, allowances are made for any exemptions granted, any |
12 | classification made of persons interested in the estate and for any deductions and credits allowed |
13 | by the law imposing the tax. |
14 | (b) Any exemption or deduction allowed by reason of the relationship of any person to |
15 | the decedent or by reason of the purposes of the gift inures to the benefit of the person bearing |
16 | that relationship or receiving the gift. When an interest is subject to a prior present interest which |
17 | is not allowable as a deduction, the tax apportioned against the present interest is paid from |
18 | principal. |
19 | (c) Any deduction for previously taxed property and any credit for gift taxes or death |
20 | taxes of a foreign country paid by the decedent or his or her estate inures to the proportionate |
21 | benefit of all persons liable to apportionment. |
22 | (d) Any credit for inheritance, succession or estate taxes or taxes in their nature in respect |
23 | to property or interests includable in the estate inures to the benefit of the person or interests |
24 | chargeable with their payment to the extent that, or in proportion as the credit reduces the tax. |
25 | (e) To the extent that property passing to or in trust for a surviving spouse or any |
26 | charitable, public, or similar gift or bequest does not constitute an allowable deduction for |
27 | purposes of the tax solely by reason of an inheritance tax or other death tax imposed upon and |
28 | deductible from the property, the property shall not be included in the computation provided for |
29 | in this chapter, and to that extent no apportionment shall be made against the property. This does |
30 | not apply in any instance where the result deprives the estate of a deduction otherwise allowable |
31 | under 26 U.S.C. § 2053(d), relating to deduction for state death taxes on transfers for public, |
32 | charitable, or religious uses. |
33 | 44-23.1-6. No apportionment between temporary and remainder interests. |
34 | No interest in income and no estate for years or for life or other temporary interest in any |
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1 | property or fund is subject to apportionment as between the temporary interest and the remainder. |
2 | The tax on the temporary interest and the tax, if any, on the remainder is chargeable against the |
3 | corpus of the property or funds subject to the temporary interest and remainder. |
4 | 44-23.1-7. Exoneration of fiduciary. |
5 | Neither the fiduciary nor other person required to pay the tax is under any duty to |
6 | institute any suit or proceeding to recover from any person interested in the estate the amount of |
7 | the tax apportioned to that person until the expiration of the three (3) months next following final |
8 | determination of the tax. A fiduciary or other person required to pay the tax who institutes the suit |
9 | or proceeding within one year after the three (3) month period is not subject to any liability or |
10 | surcharge because any portion of the tax apportioned to any person interested in the estate was |
11 | collectible at a time following the death of the decedent but thereafter became uncollectible. If the |
12 | fiduciary or other person required to pay the tax cannot collect from any person interested in the |
13 | estate the amount of the tax apportioned to the person, the amount not recoverable is paid from |
14 | the residuary estate. To the extent that the residuary estate is not adequate, the balance is |
15 | equitably apportioned among the other persons interested in the estate who are subject to |
16 | apportionment. |
17 | 44-23.1-8. Action by nonresident, reciprocity. |
18 | Subject to this section, a fiduciary acting in another state or a person required to pay the |
19 | tax who is domiciled or resident in another state may institute an action in the courts of this state |
20 | and may recover a proportionate amount of the federal estate tax or an estate tax payable to |
21 | another state or of a death duty due by the decedent's estate to another state from a person |
22 | interested in the estate who is either domiciled or resident in this state or who owns property in |
23 | this state subject to attachment or execution. For the purposes of the action, the determination of |
24 | apportionment by the court having jurisdiction of the administration of the decedent's estate in the |
25 | other state is prima facie correct. The provisions of this section apply only if the state in which |
26 | the determination of apportionment was made affords a substantially similar remedy. |
27 | 44-23.1-9. Uniformity of interpretation. |
28 | This chapter shall be applied and construed as to effectuate its general purpose to make |
29 | uniform the law with respect to the subject of this chapter among those states, which enact it. |
30 | 44-23.1-10. Short title. |
31 | This chapter may be cited as the "Uniform Estate Tax Apportionment Act". |
32 | 44-23.1-11. Severability. |
33 | If any provision of this chapter or the application of this chapter to any person or |
34 | circumstance is held invalid, the invalidity does not affect other provisions or applications of the |
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1 | chapter, which can be given effect without the invalid provision or application, and to this end the |
2 | provisions of this chapter are severable. |
3 | 44-23.1-12. Time of application of chapter. |
4 | This chapter does not apply to taxes due on account of the death of decedents dying prior |
5 | to six (6) months after July 6, 1971. |
6 | SECTION 4. This act shall take effect upon passage. |
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EXPLANATION | |
BY THE LEGISLATIVE COUNCIL | |
OF | |
A N A C T | |
RELATING TO TAXATION -- ESTATE AND TRANSFER TAXES | |
*** | |
1 | This act would repeal the estate tax and transfer tax. |
2 | This act would take effect upon passage. |
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LC004268 | |
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