CO HB1042

Creates a state income tax credit for persons who inherit agricultural land in Colorado, equal to the amount of Colorado estate taxes paid that are attributable to the transfer of such land.

Credit applies only after Congress enacts a law delaying the sunset of federal estate tax amendments beyond December 31, 2012, and only for tax years when an estate tax is owed under Colorado law.

If the credit exceeds income taxes owed, the Department of Revenue shall refund the excess amount to the taxpayer.

If the property ceases to be classified as agricultural land for property tax purposes within ten years of claiming the credit, the credit is disallowed and the taxpayer must file an amended return with interest due at the inflation rate.

Statute of limitations for assessing taxes owed due to credit disallowance is eleven years from the due date of the original return claiming the credit.