Connecticut General Statutes 12-646a – Value of farm transferred by gift
(a) In determining the tax due under the provisions of this chapter, the value of any farm land, as defined in section 12-107c, transferred by a donor by gift to a donee who is a lineal descendant or spouse thereof, shall be determined in accordance with the provisions of section 12-63.
Terms Used In Connecticut General Statutes 12-646a
- Donee: The recipient of a gift.
- Donor: The person who makes a gift.
- Fair market value: The price at which an asset would change hands in a transaction between a willing, informed buyer and a willing, informed seller.
- farm: includes farm buildings, and accessory buildings thereto, nurseries, orchards, ranges, greenhouses, hoophouses and other temporary structures or other structures used primarily for the raising and, as an incident to ordinary farming operations, the sale of agricultural or horticultural commodities. See Connecticut General Statutes 1-1
- Gift: A voluntary transfer or conveyance of property without consideration, or for less than full and adequate consideration based on fair market value.
- Lien: A claim against real or personal property in satisfaction of a debt.
- Lineal descendant: Direct descendant of the same ancestors.
- month: means a calendar month, and the word "year" means a calendar year, unless otherwise expressed. See Connecticut General Statutes 1-1
- Real property: Land, and all immovable fixtures erected on, growing on, or affixed to the land.
(b) If, within ten years immediately following a transfer to a donee where, as provided in subsection (a) of this section, the value is determined in accordance with the provisions of section 12-63, such farm land is transferred by the donee to a party other than the donee’s lineal descendant or the spouse thereof or is no longer classified as farm land in accordance with section 12-107c, such donee or, if such land was transferred to such donee’s lineal descendant or the spouse thereof, such descendant or the spouse thereof shall be liable for the difference between the tax that was due from the donor under the provisions of subsection (a) of this section and the tax that would have been due if such land had been valued based upon its fair market value, rather than at its value as land classified as farm land pursuant to section 12-107c, at the time of such transfer by such donor. The gift tax return of the donor shall include, in such manner as required by the Commissioner of Revenue Services for purposes of this section, a declaration, prescribed as to form by the Commissioner of Revenue Services and bearing notice to the effect that false statements made in such declaration are punishable, as to the fair market value of such farm land, based on its highest and best use value, as of the time of such transfer by such donor. The tax imposed under this subsection shall be paid to the commissioner within sixty days following the date of such transfer or change in classification, and if not so paid shall bear interest at the rate of one per cent per month or fraction thereof, commencing at the expiration of such sixty days, until paid. The commissioner may, for cause shown, on written application of such donee or, if such land was transferred to the donee’s lineal descendant or the spouse thereof, such descendant or the spouse thereof, filed with said commissioner at or before the expiration of such sixty days, extend the time for payment of said tax or any part thereof.
(c) The tax imposed under subsection (b) of this section shall be a lien in favor of the state of Connecticut upon such real property so valued as farm land from the date on which the transfer described in subsection (a) of this section was made until, if there has been no transfer or change in classification resulting in the imposition of tax under subsection (b) of this section, the expiration of ten years immediately following such transfer, or in the event of a transfer or change in classification resulting in the imposition of tax under subsection (b) of this section, payment of the tax and interest, if any, imposed under subsection (b) of this section is made; provided such lien shall not be valid against any bona fide purchaser, as defined in subsection (a) of section 12-35b, or qualified encumbrancer, as defined in subsection (b) of section 12-35b.