What You Need to Know About Colorado Inheritance Laws at a Glance
Colorado inheritance laws determine who gets your assets when you die without a will. A properly prepared estate plan empowers you to choose how your assets will pass when you die. Here’s a quick summary:
- No state inheritance tax – Colorado does not tax inheritances
- No state estate tax – Colorado has no estate tax either
- Intestate succession applies when there is no will – state law decides who inherits
- Surviving spouses are first in line, but the exact share depends on whether children from prior relationships exist
- Biological and adopted children have equal inheritance rights; stepchildren do not inherit automatically
- Small estates under $88,000 in 2026 (with no real property) may skip probate entirely
- Non-probate assets – like life insurance, retirement accounts, and jointly owned property – pass directly to named beneficiaries regardless of any will or intestacy rules
- Federal estate tax may apply to estates over $15 million in 2026
Losing someone close to you is hard enough. Then comes the paperwork, the legal questions, and the sinking feeling that you might be doing something wrong. If your loved one died without a will, you’re likely wondering who gets what and whether a court is about to make that decision for you.
The answer depends on Colorado’s intestate succession laws. These are the rules the state uses to divide an estate when there’s no will in place. And they don’t always match what the deceased person would have wanted.
For blended families, business owners, and real estate investors especially, the default rules can lead to unexpected, and sometimes painful, outcomes.
I’m Gerard Deffenbaugh, an estate planning and probate attorney with over a decade of experience helping Colorado families navigate Colorado inheritance laws, from small estates to complex multi-asset situations. In this guide, I’ll walk you through exactly how intestate succession works and what you can do to make sure your estate ends up in the right hands.
Understanding Colorado Inheritance Laws and Intestate Succession
When someone passes away without leaving a valid last will and testament, they are said to have died “intestate.” In these situations, the state of Colorado steps in with a pre-designed legal backup plan. This default framework is known as intestate succession.
Essentially, the state writes a will for the deceased person based on what the legislature assumes a “typical” person would want. However, in my Centennial office, I often see that very few families fit perfectly into a generic mold.
It is important to understand that intestate succession only governs “probate assets.” These are assets that were owned solely in the deceased person’s name at the time of their death and do not have a designated beneficiary. If an asset has a co-owner as a joint tenant or a designated beneficiary, it bypasses this entire process. To learn more about how this works, you can read our guide on Do All Estates Have to Go Through Probate in Colorado?.
Another critical rule under C.R.S. Title 15 Article 11 – Intestate Succession and Wills is the 120-hour survival rule. To inherit under Colorado’s intestate laws, an heir must survive the deceased person by at least 120 hours (five full days). If an heir passes away three days after the decedent, Colorado law treats them as if they died before the decedent. This prevents assets from double-probating in rapid succession.
How SB22-092 Modernized Colorado Inheritance Laws
The legal landscape is constantly evolving. A major update occurred when the state legislature passed SB22-092 Update Colorado Probate Code, which went into effect to modernize and streamline estate administration.
One of the primary goals of SB22-092 was to replace outdated, gender-specific language with modern, gender-neutral terminology. It also clarified how property passes when a decedent dies without a will, reinforcing the “per capita at each generation” distribution model.
Additionally, these updates recognized the growing role of “designated beneficiaries” under Colorado law, ensuring that individuals who have registered a designated beneficiary agreement with their county are treated with appropriate priority, similar to a surviving spouse in specific scenarios.
The Role of Domicile and Out-of-State Property
Where a person legally lived at the time of their death (their “domicile”) determines which state’s laws govern their personal property (like bank accounts, vehicles, and personal belongings). If your loved one was a resident of Centennial, CO, then Colorado inheritance laws apply to their personal property, no matter where that personal property is physically located.
Real estate, however, is a different story. Real property is governed by the laws of the state where the land is physically located (its “situs”).
If a Colorado resident dies owning a cabin in Wyoming or a condo in Florida, the Colorado probate court cannot directly transfer that out-of-state land. Instead, the family must open a secondary probate proceeding, known as ancillary probate, in that other state just to handle the real estate.
Ancillary probate can cost thousands of dollars in extra court fees and out-of-state attorney bills. Fortunately, I can help you avoid this headache using estate planning tools such as:
- Revocable Living Trusts: By transferring the title of the out-of-state property to a trust, it bypasses probate entirely.
- Beneficiary Deeds: Recording a transfer-on-death deed in the county where the property is located.
- LLC Ownership: Placing the real estate into a Limited Liability Company, which converts the real property asset into personal property (shares of the LLC), allowing it to be managed under your primary Colorado probate.
Who Inherits When There Is No Will?
If there is no will, Colorado law establishes a strict priority list of who is entitled to inherit the probate estate.
The distribution pathway starts with the closest living relatives (spouse and children) and expands outward to parents, siblings, and more distant relatives only if no immediate family members survive.
Spousal Shares and Blended Family Complications
Many people assume that if they die, their surviving spouse automatically inherits everything. Under Colorado inheritance laws, this is only true if your family matches a specific scenario: you have no surviving children, or all of your children are also the children of your surviving spouse, and your spouse has no other children.
If you have a blended family, the rules change dramatically. The law attempts to balance protecting the surviving spouse with ensuring that children from previous relationships are not completely disinherited.
The table below outlines how Colorado divides an intestate estate between a surviving spouse and other heirs:
| Family Composition | What the Surviving Spouse Inherits | What Other Heirs Inherit |
|---|---|---|
| No surviving descendants or parents | 100% of the intestate estate | Nothing |
| Surviving descendants who are all also descendants of the spouse; spouse has no other children | 100% of the intestate estate | Nothing |
| No surviving descendants, but a parent of the decedent survives | First $300,000, plus 3/4 of the remaining balance | Remaining 1/4 goes to the surviving parent(s) |
| All descendants are also the spouse’s, but the spouse has children from another relationship | First $225,000, plus 1/2 of the remaining balance | Remaining 1/2 goes to the decedent’s descendants |
| Decedent has surviving descendants from a prior relationship | First $150,000, plus 1/2 of the remaining balance | Remaining 1/2 goes to the decedent’s descendants |
As you can see, if you have children from a prior relationship, your surviving spouse might only receive the first $150,000 and half of whatever is left. If your primary asset is a home you owned together as tenants in common, this rule could force your spouse to share ownership of the home with your adult children, or even force a sale of the property.
Rights of Children, Adopted Descendants, and Stepchildren
Under Colorado law, “descendants” refers to your children, grandchildren, great-grandchildren, and so on. But who legally qualifies as a child?
- Biological Children: Have full intestate inheritance rights, regardless of whether you were married to their other parent.
- Adopted Children: Have the exact same legal inheritance rights as biological children. Legally adopting a child permanently severs their legal relationship with their biological parents and grafts them into your estate.
- Stepchildren and Foster Children: Do not inherit under Colorado’s intestate laws. No matter how long you raised them or how close your bond, a stepchild has no automatic right to your estate unless you formally adopt them or name them in a will.
- After-Born Children: If a child is conceived before your death but born after, they inherit as if they were born during your lifetime.
- Omitted Children: If you write a will and later have or adopt a child, Colorado’s updated omitted child rules ensure that the new child receives a share of your estate, unless it is clear from the will or external transfers that you intended to exclude them.
Extended Family: Parents, Siblings, and Per Capita Distribution
If you die without a spouse or any surviving descendants, your estate travels up and out your family tree. According to Colorado Revised Statutes Section 15-11-103 (2024), the assets will be distributed in this order:
- Your Parents: Divided equally if both survive, or 100% to the single surviving parent.
- Descendants of Your Parents (Siblings): If your parents have passed, your brothers and sisters (or their children, if your siblings predeceased you) inherit. Half-blood siblings inherit equally with full-blood siblings.
- Grandparents or Descendants of Grandparents (Uncles, Aunts, Cousins): If no parents or siblings exist, the estate is split between your maternal and paternal grandparents’ families.
Colorado uses a system called per capita at each generation to divide shares among siblings, nieces, nephews, and cousins.
Under this system, the estate is divided equally at the nearest generation that has surviving heirs. The shares of any deceased members of that generation are combined and divided equally among their children in the next generation. This ensures that all cousins or nieces/nephews at the same generational level receive equal shares.
Navigating the Colorado Probate Process
Probate is the court-supervised legal process of validating a will (if one exists), appointing a personal representative, paying off the deceased person’s debts, and distributing the remaining assets.
If there is no will, the court must still appoint a personal representative (historically called an executor) to manage the estate. Colorado law establishes a priority list for who can apply to be the personal representative, starting with a surviving spouse, followed by other heirs.
Without a will, this appointment process can sometimes lead to family disputes over who is best suited to run the estate. This is just one of many reasons Why Every Adult Should Have a Will: Debunking Common Myths is an essential read for anyone putting off their planning.
Small Estates, Informal, and Formal Probate Procedures
Colorado offers three different pathways for probate, depending on the complexity of the estate and whether the family members agree:
- Small Estate Affidavit: If the total value of the probate assets is under a certain threshold (which is $86,000 in 2026 and is adjusted annually for inflation) and the deceased did not own any real estate, the heirs can bypass the court entirely. They simply fill out a small estate affidavit, have it notarized, and use it to collect bank accounts or transfer vehicle titles.
- Informal Probate: This is an administrative process handled by a court registrar rather than a judge. It is used when there is a valid will (or clear agreement on intestacy), no disputes among heirs, and a qualified personal representative ready to act. For a deeper look, check out our guide on Understanding the Three Types of Probate in Colorado.
- Formal Probate: This requires formal court hearings before a judge. It is necessary if there are disputes over who should inherit, challenges to the validity of a will, or if you need help Help Choosing the Right Probate Type in Colorado due to complex assets or missing heirs.
Non-Probate Assets That Bypass Court Administration
Not all of your assets are subject to probate or intestate succession laws. Many of your most valuable holdings can bypass the court entirely and transfer directly to your loved ones.
These are called non-probate assets. They transfer automatically upon your death by operation of law or contract. To understand what falls into this category, review our detailed guide on What Assets Are Exempt from Probate in Colorado?.
Common examples of non-probate assets include:
- Joint Tenancy with Right of Survivorship: If you own a home or a bank account with someone else as joint tenants, the survivor automatically owns 100% of the asset when you pass away.
- Payable-on-Death (POD) and Transfer-on-Death (TOD) Accounts: You can add these designations to bank accounts, investment portfolios, and vehicle titles to name a beneficiary who will inherit the asset automatically without probate.
- Life Insurance and Retirement Accounts: These contracts require you to name a beneficiary. When you die, the insurance company or custodian pays the funds directly to the named person, completely bypassing your will or intestate estate.
Tax Implications of Inheriting Property in Colorado
One of the most common questions I hear in Centennial is, “How much is the government going to take out of my inheritance?”
Fortunately, Colorado is a very tax-friendly state for heirs.
State and Federal Estate Taxes in 2026
First, the good news: Colorado has no state inheritance tax and no state estate tax. You will not owe any state tax simply for receiving an inheritance.
However, we must still keep an eye on federal taxes. The federal estate tax is a tax on the transfer of property at death. It is paid by the estate itself, not by the individual heirs.
For 2026, the federal estate tax exemption is historically high at $15 million per individual (or $30 million for married couples). If the total value of your estate is below this amount, you owe $0 in federal estate tax.
Capital Gains, Step-Up in Basis, and Property Taxes
While you won’t pay an inheritance tax, you may face capital gains taxes if you decide to sell inherited property. This is where the step-up in basis rule becomes your best friend.
When you buy an asset (like a house or a stock), its value at the time of purchase is your “tax basis.” If you sell it years later, you pay capital gains tax on the difference between the sale price and your basis.
When you inherit property, however, the tax basis may be “stepped up” to the fair market value of the property on the date of the deceased person’s death.
Example: Your parents bought a home in Centennial in 1980 for $50,000. When they pass away, the home is worth $650,000. If they had transferred the home to you before dying, you could have faced a massive capital gains tax. But because you inherited it after death and there was a “stepped up” basis, your new tax basis is $650,000. If you sell the home shortly after inheriting it for $650,000, your taxable gain is $0. You pay zero federal capital gains tax, and you bypass Colorado’s flat 4.4% capital gains tax rate entirely.
If the deceased parent qualified for the Senior Property Tax Exemption, that exemption does not automatically transfer to the heirs unless the surviving spouse also qualifies.
Protecting Your Estate and Avoiding Intestacy
Dying without a will means giving up your right to decide who gets your hard-earned assets, who raises your minor children, and who manages your estate.
Taking control of your legacy starts with understanding your options. A great place to begin is by exploring the 4 Basic Types of Wills: What You Need to Know.
How Trusts and Beneficiary Designations Safeguard Assets
Wills are great, but they still have to go through the probate court. If you want to make things as simple and private as possible for your family, a Revocable Living Trust is often the gold standard.
When you set up a living trust, you retain complete control over your assets during your lifetime. When you pass away, the successor trustee you named steps in and distributes the trust assets to your beneficiaries according to your exact instructions and completely bypassing the probate court, saving months of delay.
For real estate owners, a Colorado Beneficiary Deed (also known as a Transfer-on-Death deed) is another excellent tool when used in a thoughtful manner. It allows you to name a beneficiary (including a trust) who will automatically inherit your home upon your death, but it must be signed and recorded in the county where the property is located before your death to be valid.
Spousal Elective Shares and Disclaiming an Inheritance under Colorado Inheritance Laws
Can you disinherit a spouse in Colorado? The short answer is no unless there is valid marital agreement.
Under Colorado inheritance laws, a surviving spouse has a right to claim an elective share of the deceased spouse’s estate, even if a will explicitly leaves them nothing.
The elective share is designed to prevent spouses from being left destitute. It is calculated as 50% of the “augmented estate,” which includes both probate assets and many non-probate assets (like trusts and joint bank accounts). The exact percentage of the elective share can also depend on the length of the marriage.
On the flip side, what if you are left an inheritance that you do not want? Perhaps you want the assets to pass to your children instead, or you want to avoid tax complications.
You can refuse an inheritance by filing a qualified disclaimer. To be valid under federal and Colorado law, the disclaimer must be:
- Made in writing
- Delivered to the personal representative or court within nine months of the decedent’s death
- Irrevocable and unconditional
Once you disclaim, you cannot choose who gets the property next; the assets will pass as if you had predeceased the person who left them to you.
Frequently Asked Questions About Colorado Inheritance
What happens to retirement accounts like IRAs and 401(k)s?
Retirement accounts are non-probate assets that pass directly to the beneficiaries named on the account.
If you name your spouse, they can roll the account into their own IRA and continue deferring taxes.
However, if you name a non-spouse beneficiary (like your children), they are subject to the IRS 10-year rule. This rule requires them to fully distribute and pay taxes on all assets in the inherited account within 10 years of your death.
To minimize the tax hit for your kids, I often discuss strategies like Roth conversions during your lifetime or utilizing charitable remainder trusts.
How long do heirs have to disclaim an inheritance in Colorado?
As mentioned above, you have a strict nine-month window from the date of the decedent’s death to file a qualified disclaimer. If you miss this deadline, the IRS and Colorado will treat you as having accepted the inheritance, and transferring it to someone else later could trigger gift tax implications.
Conclusion
At the end of the day, Colorado inheritance laws are designed to provide a safety net when there is no plan in place. But a safety net is rarely a perfect fit. Relying on the state’s default rules can expose your family to unintended tax burdens, public probate court proceedings, and family disputes.
If you are currently dealing with the loss of a loved one and trying to figure out your next steps, you might be asking yourself, Why Do I Need Probate?. I can help you answer that question and guide you through the process with clarity and compassion.
At Colorado Trusts & Taxes, I help small business owners, real estate investors, and everyday families in Centennial and across Colorado build estate plans that protect their assets and keep their loved ones out of court.
Whether you need to draft a simple will, establish a living trust, or navigate the probate of an estate, I am here to provide the personalized, empathetic guidance you deserve.
Contact my office today to schedule a consultation, and let’s make sure your legacy is protected on your terms.