§ 26-59-113 - Payment -- Time limitations -- Federal election. - Arkansas Statutes

26-59-113. Payment -- Time limitations -- Federal election.

(a) The tax imposed by this chapter shall be due and payable nine (9) months after a decedent's death and shall be paid by the executor to the Director of the Department of Finance and Administration.

(b) (1) (A) When the director finds that the payment on the due date of the tax or any part of the tax would impose undue hardship upon the estate, the director may extend the time for any payment of any such part.

(B) However, no extension shall be for more than eighteen (18) months, and the aggregate of the extension with respect to any estate shall not exceed five (5) years from the due date, except as provided in subsection (c) of this section.

(2) In such case, the amount in respect of which the extension is granted shall be paid on or before the date of the expiration of the period of the extension unless further extension is granted.

(c) (1) The provisions of 26 U.S.C. 6166, as amended and in effect on January 1, 2002, which provide for an election by the representative of a decedent's estate to pay the federal estate tax due on certain qualifying assets of the estate in deferred installments for a period of up to fifteen (15) years at a two percent (2%) interest rate regarding either the estate original shown due on the estate tax return or as later determined to be due following audit shall be adopted as a state estate tax law.

(2) (A) However, the two percent (2%) interest rate shall only apply to the "2-percent portion" as that term is defined in 26 U.S.C. 6601(j)(2), as amended and in effect on January 1, 2002.

(B) The interest rate on the estate tax exceeding the "2-percent portion" shall be at the rate specified in 26-18-508 concerning tax deficiencies.

(3) Any timely filed election by the representative of the decedent's estate for deferral of the payment of federal estate taxes shall be deemed to also defer the payment of the applicable portion of Arkansas estate tax for the same periods of time for the Arkansas assets qualifying for this special federal election.