Estate Taxes

Under current law, no federal or Colorado estate taxes are payable on estates of Colorado residents who have less than $2 million in total net assets. With proper planning, a husband and wife can transfer up to $4 million to their children without paying any federal or state estate taxes. Unlike many other states, Colorado has no inheritance tax.

If the combined value of your estate and your spouse’s estate exceeds $2 million, you should consult an estate-planning or tax attorney about planning to avoid estate taxes, which may include creating irrevocable trusts, gifting options, charitable donations, etc. For tax purposes, your estate includes all property in which you have an interest. This includes the proceeds of life insurance policies and retirement benefits, joint tenancy property and certain life estates. (See Chapter 7, Part II, for more information on life estates.) The value of your property for estate tax purposes is the fair market value on the date of your death.