Chapter 29. Apportionment Of Estate Taxes
TITLE 12
Decedents' Estates and Fiduciary Relations
Administration of Decedents' Estates
CHAPTER 29. APPORTIONMENT OF ESTATE TAXES
§ 2901. Proration of state and federal estate taxes; method.
(a) Whenever it appears upon any accounting or in any appropriate action or proceeding that an executor, administrator, temporary administrator, trustee or other person acting in a fiduciary capacity (or individually) has, after April 2, 1947, paid an estate tax levied or assessed under Chapter 15 of Title 30 providing for a tax known as "Delaware Estate Tax" or under any law amendatory thereof or supplemental thereto or under any other law hereafter enacted providing for the same or a different estate tax or under any estate tax law of the United States, upon or with respect to any property required to be included in the gross estate of a decedent under any such law, the amount of the tax so paid shall be equitably prorated among the persons interested in the estate to whom such property is or may be transferred or to whom any benefit accrues.
(b) Such proration shall be made in the proportion, as near as may be, that the value of the property, interest or benefit of each such person bears to the total value of the property, interests and benefits received by all such persons interested in the estate except that in making such proration allowances shall be made for any exemptions granted by the law imposing the tax and for any deductions allowed by such law for the purpose of arriving at the value of the net estate and except that in cases where a trust is created or other provision made whereby any person is given an interest in income or an estate for years or for life or other temporary interest in any property or fund, the tax on both such temporary interest and on the remainder thereafter shall be charged against and be paid out of the corpus of such property or fund without apportionment between remainders and temporary estates.
(c) For the purposes of this chapter the term "persons interested in the estate" shall with respect to both state and federal taxes include all persons who may be entitled to receive or who have received any property or interest which is required to be included in the gross estate of a decedent or any benefit whatsoever with respect to any such property or interest, whether under a will or intestacy or by reason of any transfer, trust, estate, interest, right, power or relinquishment of power taxable under any of the aforementioned laws providing for the levy or assessment of estate taxes.
46 Del. Laws, c. 119, § 1; 47 Del. Laws, c. 405, § 1; 12 Del. C. 1953, § 2901.;
§ 2902. Duty of executor, administrator or other fiduciary to pay tax before distribution.
The tax shall be paid by the executor, administrator or other fiduciary out of the estate before its distribution.
46 Del. Laws, c. 119, § 1; 47 Del. Laws, c. 405, § 1; 12 Del. C. 1953, § 2902.;
§ 2903. Recovery of proportionate tax from persons receiving taxable property which did not come into possession of executor or administrator; jurisdiction of Court of Chancery.
(a) Where any property required to be included in the gross estate does not come into the possession of the executor, administrator or other fiduciary, the executor, administrator or other fiduciary shall recover from whoever is in possession or from the persons interested in the estate the proportionate amount of such tax payable by the persons interested in the estate with which such persons are chargeable under this chapter.
(b) The Court of Chancery of the county in which any such accounting has been made or in which any such appropriate action or proceeding is pending may, by order, direct the payment of such amount of tax by such persons to the executor, administrator or other fiduciary, in accordance with subsection (a) of this section.
46 Del. Laws, c. 119, § 1; 47 Del. Laws, c. 405, § 1; 12 Del. C. 1953, § 2903; 57 Del. Laws, c. 402, § 3; 70 Del Laws, c. 186, § 1.;
§ 2904. Executor's or administrator's obligation to distribute property before person entitled has paid pro rata tax or furnished security.
No executor, administrator or other person acting in a fiduciary capacity shall be required to transfer, pay over or distribute any fund or property which may have either a federal or a state tax imposed upon it or which may be liable for the payment of any federal or state tax, until the amount of such tax or taxes due from the devisee, legatee, distributee or other person to whom such property is transferred, is paid or, if the apportionment of tax has not been determined, adequate security is furnished by the transferee for such payment.
46 Del. Laws, c. 119, § 1; 47 Del. Laws, c. 405, § 1; 12 Del. C. 1953, § 2904.;
§ 2905. Jurisdiction of and proceedings in the Court of Chancery; petition, order, parties, hearings; appointment of guardians.
(a) The Court of Chancery has jurisdiction and all power necessary to make the prorations and the orders directing the payment of amounts of tax contemplated by this chapter.
(b) Such jurisdiction may be invoked by petition filed in the Court of Chancery by an executor, administrator, temporary administrator, trustee or other person acting in a fiduciary capacity or any other person having such an interest as may in the judgment of the Court entitle such person to file such a petition.
(c) The Court of Chancery, upon making a determination as provided in § 2901 of this title, shall make a decree or order directing the executor, administrator or other fiduciary to charge the prorated amounts against the persons against whom the tax has been so prorated, insofar as such person is in possession of property or interests of such persons against whom such charge has been made, and summarily directing all other persons against whom the tax has been so prorated or who are in possession of property or interests of such persons to make payment of such prorated amounts to such executor, administrator or other fiduciary or to another person who has paid such tax.
(d) Every petition under subsection (b) of this section shall make all living interested persons parties defendant to the proceeding and they shall be summoned or otherwise notified as provided by the rules of the Court of Chancery relating to partition causes.
(e) The Court may appoint a guardian or guardians ad litem to represent the interests of persons who by reason of their minority or other cause are incompetent or of unborn or unascertainable persons who may have an interest in the estate.
(f) The Court may hear the cause upon oral testimony of witnesses or otherwise.
46 Del. Laws, c. 119, § 1; 47 Del. Laws, c. 405, § 1; 12 Del. C. 1953, § 2905; 57 Del. Laws, c. 402, § 3; 70 Del Laws, c. 186, § 1.;
§ 2906. Limitation on application of chapter.
The foregoing provisions of this chapter shall not apply where and to the extent that a testator provides in the testator's will for another method of apportionment or allocation of the taxes referred to in § 2901 of this title or where and to the extent that the written terms of an inter vivos transfer provide for another method of apportionment or allocation of such taxes which may be imposed with respect to the specific fund so transferred. Such provision in a will or in the terms of an inter vivos transfer may be in the form of a direction or of a grant of discretion to an executor or trustee to apportion or allocate such taxes or to pay such taxes out of the residuary estate under a will or from any other portion or portions of the estate passing under the will or out of the property transferred inter vivos.
46 Del. Laws, c. 119, § 1; 47 Del. Laws, c. 405, § 1; 12 Del. C. 1953, § 2906; 70 Del Laws, c. 186, § 1.;