New Mexico § 45-3-925 - Insulated property; advancement of tax

§ 45-3-925. Insulated property; advancement of tax

A. In this section: (1) “ advanced fraction ” means a fraction that has as its numerator the amount of the advanced tax and as

its denominator the value of the interests in insulated property to which that tax

is attributable; (2) “ advanced tax ” means the aggregate amount of estate tax attributable to interests in insulated

property that is required to be advanced by uninsulated holders under Subsection C

of this section; (3) “ insulated property ” means property subject to a time-limited interest that is included in the apportionable

estate but is unavailable for payment of an estate tax because of impossibility or

impracticability; (4) “ uninsulated holder ” means a person who has an interest in uninsulated property; and (5) “ uninsulated property ” means property included in the apportionable estate other than insulated property. B. If an estate tax is to be advanced pursuant to Subsection C of this section by

persons holding interests in uninsulated property subject to a time-limited interest

other than property to which Section 11 of this act applies, the tax must be advanced,

without further apportionment, from the principal of the uninsulated property. C. Subject to Subsections B and D of Section 13 of this act, an estate tax attributable

to interests in insulated property must be advanced ratably by uninsulated holders. If the value of an interest in uninsulated property is less than the amount of estate

taxes otherwise required to be advanced by the holder of that interest, the deficiency

must be advanced ratably by the persons holding interests in properties that are excluded

from the apportionable estate under Paragraph (2) of Subsection A of Section 6 of

this act as if those interests were in uninsulated property. D. A court having jurisdiction to determine the apportionment of an estate tax may

require a beneficiary of an interest in insulated property to pay all or part of the

estate tax otherwise apportioned to the interest if the court finds that it would

be substantially more equitable for that beneficiary to bear the tax liability personally

than for that part of the tax to be advanced by uninsulated holders. E. When a distribution of insulated property is made, each uninsulated holder may

recover from the distributee a ratable portion of the advanced fraction of the property

distributed. To the extent that undistributed insulated property ceases to be insulated, each

uninsulated holder may recover from the property a ratable portion of the advanced

fraction of the total undistributed property. F. Upon a distribution of insulated property for which, pursuant to Subsection D of

this section, the distributee becomes obligated to make a payment to uninsulated holders,

a court may award an uninsulated holder a recordable lien on the distributee's property

to secure the distributee's obligation to that uninsulated holder.