Exempt Property and Family Allowance in Colorado by Brian Budman

Occasionally, and generally in a second (or third) marriage, when a spouse dies, the surviving spouse has been left out of the will, or has otherwise not been properly provided for by the deceased spouse. In those instances, the surviving spouse should understand certain rights that he or she has under the laws of Colorado.

The Exempt Property and the Family Allowance are entitlements that have priority over all claims against the decedent’s estate.

Section 15-11-403 of the Colorado Revised Statutes (C.R.S.) provides that the decedent’s surviving spouse is entitled to exempt property from the estate in the amount of $33,000.00 (2017 number). If there is no surviving spouse, the decedent’s dependent children are entitled to the same exempt property. Rights to exempt property have priority over all claims against the estate, except claims for the costs and expenses of administration, and reasonable funeral and burial, interment, or cremation expenses. This is in addition to any benefit passing to the surviving spouse or dependent children under the will.

In addition to the right to exempt property, the decedent’s surviving spouse and minor children who the decedent was obligated to support and children who were in fact being supported by the decedent are entitled to a reasonable allowance in money out of the estate for their maintenance during the period of administration. This is called the Family Allowance and is provided for under C.R.S.  Section 15-111-405, and is $33,000.00 in 2017.

The family allowance may not continue for longer than one year if the estate is inadequate to discharge valid claims against the estate. Like the exempt property allowance, the family allowance is exempt from and has priority over all claims except claims for the costs and expenses of administration, and reasonable funeral and burial, interment, or cremation expenses. The family allowance is in addition to any benefit passing to the surviving spouse or dependent children under the will. The amount of the family allowance can vary greatly from one estate to the next.

In an estate that has more bills to pay than money to pay them with, the exempt property allowance and family allowance can divert money to the surviving spouse and dependent children. However, these allowances must be requested within approximately six months from date of death. Failure to timely make the request terminates the right.

Many surviving spouses and dependent children never make the election to take the exempt property and family allowances. They assume that there will be enough money to pay all the bills and then distribute the remainder to them. This can be a mistake. On occasion, expenses end up being much higher than expected. Making the request for these two allowances should always be considered.

The exempt property and family allowances can be used strategically when a spouse or dependent children are not provided for in the deceased’s will or only receive part of the estate.

The exempt property allowance and the family allowance exist to provide support for a surviving spouse and dependent children. Exercising the right to these allowances should always be considered, even in estates with significant assets.

For more information, please feel free to contact this office at 303-217-2018.