summary
Introduced
02/19/2026
02/19/2026
In Committee
02/19/2026
02/19/2026
Crossed Over
Passed
Dead
Introduced Session
2026 Regular Session
Bill Summary
The bill requires a bank, broker-dealer, depository institution, credit union, or financial or institutional investor (covered entity) that holds benefits that are designated by a donor to a charitable organization to pay the designated benefits not later than 60 calendar days after the charitable organization submits an affidavit attesting to the death of the donor and including certain other information, except as described in federal law. If a covered entity that holds designated benefits is unable to pay the designated benefits to a charitable organization because federal law requires the covered entity to take certain actions or satisfy certain criteria in order to pay the designated benefits, the covered entity must take such actions or satisfy the criteria and comply with the bill not less than 120 days after the charitable organization submits the affidavit to the covered entity. If a charitable organization receives designated benefits that concern a creditor claim, statutory allowance, or elective-share or supplemental elective-share claim (outstanding claim) for which the charitable organization may be liable, the charitable organization must return to the donor's estate a portion or all of the designated benefits in order to satisfy the outstanding claim within 60 days after receiving written notice of the liability, with certain exceptions. If the charitable organization fails to comply, it must pay statutory interest to the donor's estate for each day the unreturned amount remains outstanding. Upon receiving notice of the outstanding claim from the personal representative of the donor's estate, the charitable organization must hold all or a portion of the designated benefits in a constructive trust pending a determination of the outstanding claim. Moreover, the charitable organization may be subject to one or more court actions. A covered entity that holds benefits that are designated to a charitable organization shall not: ! Require the charitable organization to establish an account with the covered entity as a condition of receiving the designated benefits; or ! Require an individual employed by, or serving on the board of, the charitable organization to submit personal information as a condition of receiving designated benefits. The bill may be enforced by the division of banking, the financial services board, or the division of securities, as appropriate.
AI Summary
This bill establishes new rules for how financial institutions, referred to as "covered entities" (which include banks, broker-dealers, credit unions, and other financial investors), must handle designated benefits intended for charitable organizations after an individual's death. Specifically, covered entities must pay these designated benefits to the charity within 60 days of receiving an affidavit from the charity confirming the donor's death and providing necessary documentation, unless federal law requires otherwise, in which case they have 120 days. The bill also clarifies that charities receiving these benefits may be liable for outstanding claims against the donor's estate, such as creditor claims or spousal inheritance rights, and must return funds to the estate within 60 days of notification to satisfy these claims, or face penalties including interest and potential court actions. Furthermore, charities are required to hold designated benefits in a constructive trust if notified of a potential claim, and covered entities are prohibited from requiring charities to open accounts with them or demanding personal information from charity employees or board members as a condition of receiving the designated benefits. The bill outlines enforcement by state banking, financial services, and securities divisions.
Committee Categories
Budget and Finance
Sponsors (3)
Last Action
Introduced In Senate - Assigned to Finance (on 02/19/2026)
Official Document
bill text
bill summary
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bill summary
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bill summary
| Document Type | Source Location |
|---|---|
| State Bill Page | https://leg.colorado.gov/bills/SB26-118 |
| BillText | https://leg.colorado.gov/bill_files/112259/download |
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