CHAPTER 79 HOUSE BILL No. 2549 An  Act amending and supplementing the Kansas estate tax act; amending K.S.A. 1998
Supp. 79-15,100, 79-15,102, 79-15,103, 79-15,107, 79-15,109 and 79-15,113 and re-
pealing the existing sections; also repealing K.S.A. 1998 Supp. 79-15,104 and 79-15,110.
Be it enacted by the Legislature of the State of Kansas:

      Section  1. K.S.A. 1998 Supp. 79-15,100 is hereby amended to read
as follows: 79-15,100. K.S.A. 1998 Supp. 79-15,100 through 79-15,119
and sections 7 through 12 shall be known and may be cited as the Kansas
estate tax act.

      Sec.  2. K.S.A. 1998 Supp. 79-15,102 is hereby amended to read as
follows: 79-15,102. (a) A tax is hereby imposed on the estate of every
resident decedent, and every nonresident decedent who died holding an
interest in property with a Kansas tax situs, whose estate is required by
federal law to file a return for federal estate taxes. The amount of such
tax shall be equal to the amount of the maximum credit allowed allowable
by section 2011 of the internal revenue code against the tax that would
otherwise be imposed on the transfer of the estate of the decedent by
section 2001 of the internal revenue code.

      (b) When the estate of a resident decedent shall consist consists of
property within and without the state, or in the case of the estate of a
nonresident decedent who died holding an interest in property with a
Kansas tax situs, the tax imposed under subsection (a) shall be the per-
centage thereof that the gross estate for federal estate tax purposes less
the value of all property included therein having a tax situs which is not
within the jurisdiction of the state of Kansas, bears to the total gross estate
for federal estate tax purposes.

      Sec.  3. K.S.A. 1998 Supp. 79-15,103 is hereby amended to read as
follows: 79-15,103. (a) The personal representative of every estate subject
to the tax imposed by K.S.A. 1998 Supp. 79-15,102 and amendments
thereto who is required by federal law to file a return for federal estate
taxes shall file in the office of the director a return on forms prepared
and furnished by the secretary together with a copy of the federal estate
tax return on or before the date the federal estate tax return is required
to be filed. The personal representative of any decedent whose estate is
not taxable under the provisions of this act, may obtain a determination
of the director that no tax liability exists on such estate by filing a return
on forms prepared and furnished by the secretary stating that such estate
is not taxable.

      (b) The taxes imposed under the provisions of this act shall be paid
by the personal representative to the director at the expiration of nine
months after the death of the decedent.

      (c) If the taxes contemplated by this act are not paid when due, in-
terest at the rate prescribed by K.S.A. 79-2968(b) subsection (b) of K.S.A.
79-2968, and amendments thereto, shall be charged and collected com-
mencing at the time the same become payable.

      Sec.  4. K.S.A. 1998 Supp. 79-15,107 is hereby amended to read as
follows: 79-15,107. (a) Property of which a decedent died seized or pos-
sessed, subject to the taxes imposed by this act, in whatever form of
investment it may happen to be shall be charged with a lien for all taxes,
penalty and interest thereon which are or may become due on such prop-
erty; but the lien shall not affect any property after it has been sold or
disposed of for value by the executors or administrators in accordance
with law, but in all such cases a lien shall attach to the proceeds realized
from any such sale or other disposition for all taxes and interest thereon
which are or may be due on such property. That portion of the decedent's
property which is used for the payment of charges against the estate and
expenses of its administration, allowed by any court having jurisdiction
thereof, shall be divested of such lien. The lien on any property subject
to the act by virtue of the provisions of this subsection shall be divested
after 10 years from the date of the decedent's death. If the taxes imposed
under this act are not paid when due, the spouse, transferee other than a
bona fide purchaser for value, surviving tenant, person in possession of
the property by reason of the exercise, nonexercise or release of a power
of appointment, or beneficiary, who receives, or has on the date of the
decedent's death, property included in the gross estate as determined for
federal estate tax purposes shall be personally liable for such tax, to the
extent of the value of such property at the time of the decedent's death.

      (b) If the personal representative fails to timely pay the tax imposed
by K.S.A. 1998 Supp. 79-15,102 and amendments thereto, the director
shall enforce the director's lien payment of the tax by the issuance of a
warrant under the director's hand and official seal, directed to the sheriff
of any county of the state, commanding such sheriff to levy upon and sell
the real and personal property of the estate found within the sheriff's
county for the payment of the amount thereof, with the added interest
and the cost of executing the warrant, and to return such warrant to the
director and pay to the director the money collected by virtue thereof
not more than 60 days from the date of the warrant. The sheriff shall
within five days after the receipt of the warrant, file with the clerk of the
district court of the sheriff's county a copy thereof, and thereupon the
clerk shall enter in the appearance docket in appropriate columns, the
name of the estate named in the warrant, the amount of the tax or portion
thereof and interest for which the warrant is issued and the date such
copy is filed. The amount of such warrant so docketed shall thereupon
become a lien upon the title to, and interest in, the real property of the
estate against whom it is issued in the same manner, as a judgment duly
docketed in the office of such clerk. The sheriff shall proceed in the same
manner and with like effect as prescribed by law with respect to execu-
tions issued against property upon judgments of a court of record, and
shall be entitled to the same fees for the sheriff's services to be collected
in the same manner.

      (c) The court in which the warrant is docketed shall have jurisdiction
over all subsequent proceedings as fully as though a judgment had been
rendered in the court. In the discretion of the director, a warrant of like
terms, force and effect may be issued and directed to any officer or em-
ployee of the director, and in the execution thereof such officer or em-
ployee shall have all the powers conferred by laws upon sheriffs, and the
subsequent proceedings thereunder shall be the same as provided where
the warrant is issued directly to the sheriff. The estate shall have the right
to redeem the real estate within a period of 18 months from the date of
such sale. If a warrant be returned, unsatisfied in full, the director shall
have the same remedies to enforce the claim for taxes as if the state of
Kansas had recovered judgment against the distributee for the amount of
the tax. No law exempting any goods and chattels, land and tenements
from forced sale under execution shall apply to a levy and sale under any
such warrants or upon any execution issued upon any judgment rendered
in any action for inheritance taxes. The director shall have the right at
any time after the warrant has been returned unsatisfied or satisfied only
in part, to issue alias warrants until the full amount of the tax is collected.

      (d) The lien imposed by K.S.A. 1998 Supp. 79-15,107 prior to its
amendment by this act is hereby released for the estates of decedents dying
on or after July 1, 1998.

      Sec.  5. K.S.A. 1998 Supp. 79-15,109 is hereby amended to read as
follows: 79-15,109. (a) As soon as practicable after the return is filed and
the taxes paid, the director shall issue a closing letter. Such closing letter
shall be issued to the personal representative upon the director being
satisfied that there has been a final determination of all taxes due and
that all such taxes have been paid. The director shall issue such closing
letter to the personal representative, and when the estate is involved in
probate proceedings before a district court, a copy of such closing letter
shall be forwarded to the judge of such court for recording in full in the
journal of such court.

      (b) Release of the lien imposed by K.S.A. 1998 Supp. 79-15,107, and
amendments thereto, may be provided by filing notice of release in the
office of the register of deeds in any county where any such real property
included in the gross estate is located or, when the estate is involved in
proceedings before the district court, with the court. Any such notice of
release shall be in such form as prescribed by the secretary and may
include use of or reference to the closing letter issued by the director or
may be included as part of that closing letter.

      Sec.  6. K.S.A. 1998 Supp. 79-15,113 is hereby amended to read as
follows: 79-15,113. A refund clearing fund, designated estate tax abate-
ment refund, not to exceed $50,000 shall be set apart and maintained by
the director of taxation from estate tax collections and held by the state
treasurer for the prompt payment of all abatements and refunds. If the
director of taxation finds that a claim for refund duly filed by a personal
representative should be allowed, or if a court upon a final judgment shall
find that the estate tax, penalty or interest paid by a personal represen-
tative is in excess of the amount legally due, then the director of taxation
shall issue the director's vouchers to the director of accounts and reports
for the refund to the personal representative of such tax, penalty or in-
terest together with interest provided for hereinafter. Upon receipt of
such voucher properly executed and endorsed, the director of accounts
and reports shall issue the director's warrants to the state treasurer for
the payment to the personal representative out of the estate tax abatement
refund fund. The director of taxation shall file a duplicate of such voucher
and also a statement which shall set forth the reasons why such abatement
or refund was allowed. Upon the allowance of an abatement or refund of
any tax or interest paid, interest shall be allowed and paid on the amount
of such abatement or refund at the rate of 12% per annum prescribed
and determined pursuant to K.S.A. 79-2968 and amendments thereto
from the date such tax, penalty or interest was paid to the date the refund
or abatement of estate taxes is made.

      New Sec.  7. If the tax or any part of the tax is paid by, or collected
out of, that part of the estate passing to or in the possession of any person
other than the personal representative in their capacity as personal rep-
resentative, such person shall be entitled to reimbursement out of any
part of the estate still undistributed or by a just and equitable contribution
by the persons whose interest in the estate of the decedent would have
been reduced if the tax had been paid before the distribution of the estate
or whose interest is subject to equal or prior liability for the payment of
taxes, debts or other charges against the estate. It is the purpose and
intent of this act that so far as practicable and unless otherwise directed
by the will of the decedent, the tax shall be paid out of the estate prior
to the distribution of the estate.

      New Sec.  8. Unless the decedent otherwise directs by will or trust,
if any part of the gross estate on which tax has been paid consists of the
proceeds of policies of insurance on the life of the decedent receivable
by a beneficiary other than the personal representative, the personal rep-
resentative shall be entitled to recover from such beneficiary such portion
of the total tax paid as the proceeds of such policies bear to the taxable
estate. If there is more than one such beneficiary, the personal represen-
tative shall be entitled to recover from such beneficiaries in the same
ratio. In the case of such proceeds receivable by the surviving spouse of
the decedent for which a deduction is allowed on federal form 706 under
section 2056 of the internal revenue code, relating to marital deduction,
this section shall not apply to such proceeds except as to the amount of
such proceeds in excess of the aggregate amount of the marital deductions
allowed under such section.

      New Sec.  9. Unless the decedent otherwise directs by will or trust,
if any part of the gross estate on which the tax has been paid consists of
the value of property included in the gross estate under section 2041 of
the internal revenue code, the personal representative shall be entitled
to recover from the person receiving such property by reason of the ex-
ercise, nonexercise or release of a power of appointment such portion of
the total tax paid as the value of such property bears to the taxable estate.
If there is more than one such person, the personal representative shall
be entitled to recover from such persons in the same ratio. In the case
of such property received by the surviving spouse of the decedent for
which a deduction is allowed under section 2056 of the internal revenue
code, relating to marital deductions, this section shall not apply to such
property except as to the value of such property reduced by an amount
equal to the excess of the aggregate amount of the marital deductions
allowed under section 2056 of the internal revenue code over the amount
of proceeds of insurance upon the life of the decedent receivable by the
surviving spouse for which proceeds a marital deduction is allowed under
such section.

      New Sec.  10. (a) (1) If any part of the federal gross estate consists
of property the value of which is includable in the federal gross estate by
reason of section 2044 of the internal revenue code, relating to certain
property for which marital deduction was previously allowed, the personal
representative shall be entitled to recover from the person receiving the
property the amount by which: (A) The total tax under chapter 11 of the
internal revenue code which has been paid, exceeds (B) the total tax under
chapter 11 of the internal revenue code which would have been payable
if the value of such property had not been included in the gross estate.

      (2) Subsection (a)(1) shall not apply with respect to any property to
the extent that the decedent specifically indicates by will or trust an intent
to waive any right of recovery with respect to such property.

      (b) For purposes of this section, if there is more than one person
receiving the property, the right of recovery shall be against each such
person.

      (c) In the case of penalties and interest attributable to additional taxes
described in subsections (a) and (b), rules similar to subsections (a), (b)
and (c) shall apply.

      New Sec.  11. (a) (1) If any part of the gross estate on which tax has
been paid consists of the value of property included in the gross estate
by reason of section 2036 of the internal revenue code, relating to trans-
fers with retained life estate, the decedent's estate shall be entitled to
recover from the person receiving the property the amount which bears
the same ratio to the total tax under chapter 11 of the internal revenue
code which has been paid as: (A) The value of such property, bears to
(B) the taxable estate.

      (2) Subsection (a)(1) shall not apply with respect to any property to
the extent that the decedent by will or revocable trust specifically indi-
cates an intent to waive any right of recovery under this provision with
respect to such property.

      (b) For purposes of this section, if there is more than one person
receiving the property, the right of recovery shall be against each such
person.

      (c) In the case of penalties and interest attributable to the additional
taxes described in subsection (a), rules similar to the rules of subsections
(a) and (b) shall apply.

      (d) No person shall be entitled to recover any amount by reason of
this section from a trust to which section 664 of the internal revenue code
applies, determined without regard to this section.

      New Sec.  12. The requirement imposed by K.S.A. 1998 Supp. 79-
15,110 prior to its repeal by this act that the district court find that all
estate taxes have been paid prior to accepting a final accounting from a
personal representative is hereby waived for the estates of decedents dy-
ing on or after July 1, 1998. 
Sec.  13. K.S.A. 1998 Supp. 79-15,100, 79-15,102, 79-15,103, 79-
15,104, 79-15,107, 79-15,109, 79-15,110 and 79-15,113 are hereby re-
pealed.
 Sec.  14. This act shall take effect and be in force from and after its
publication in the statute book.

Approved April 7, 1999.
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