§ 997. Extensions of time for payment of estate tax where estate
consists largely of interest in closely held businesses. The provisions
of section 6166 of the internal revenue code shall apply to this section
to the same extent as if such section of such code were contained in and
made part of this section (whether or not a federal estate tax return is
required to be filed) except as provided herein:

(a) The phrase "adjusted gross estate" shall be read as "adjusted
federal gross estate determined without reference to paragraphs (1), (2)
and (3) of subsection (a) of section nine hundred fifty-four" of this
article.

(b) The phrase "section 2001" shall be read as "section nine hundred
fifty-two or section nine hundred sixty" of this article.

(c) The phrase "the date prescribed by section 6151(a) for payment of
the tax" shall be read as "the date prescribed by this article for the
payment of the tax (without regard to any extension of time)".

(d) The term "secretary" shall be read as "commissioner of taxation
and finance".

(e) Election. The election under this section shall not be allowed
unless a similar election was made and allowed with respect to the
federal estate tax return required to be filed under the provisions of
the internal revenue code. If such election was made for the purposes of
the federal estate tax, the time for making the election under this
article shall be the same as is required under the federal estate tax.
Where no federal estate tax return is required to be filed, the election
with respect to the tax imposed under this article shall be made no
later than the date prescribed for the filing of the return under this
article (including extensions thereof) or any time thereafter as the
commissioner of taxation and finance may by regulation prescribe.

(f) The commissioner of taxation and finance may, at any time, require
a bond to be filed with him, which bond has been issued by a surety
company approved by the superintendent of financial services as to
solvency and responsibility and authorized to transact business in this
state or other security acceptable to such commissioner, in an amount
not exceeding twice the amount for which the time for payment has been
extended under this section, to secure the payment of the estate tax and
interest, the time for payment of which has been extended under this
section.

(g) If an acceleration of payment occurs with respect to the tax
imposed by this article, the extension of time for payment of the tax
imposed by this article shall cease to apply and any unpaid portion of
the tax payable in installments shall be paid upon notice and demand
from the commissioner of taxation and finance. If any such acceleration
of payment is avoided by a payment within six months of the due date
thereof, then the provisions of subsection (j) of this section with
respect to a two percent rate of interest shall not apply to said
payment and there is imposed a penalty of five percent of the amount of
such payment multiplied by the number of months, or fractions thereof,
after the due date of the payment and before payment is made. Such
acceleration of payment shall occur if:

(1) any installment of estate tax imposed by this article is not paid
on or before the date fixed for its payment (including any extension of
time for the payment of such installment), or

(2) the executor has been notified by the commissioner of taxation and
finance that a bond or other security is required, but no such bond or
other security has been filed within thirty days from the date of
mailing of such notification, or

(3) an acceleration of payment has occurred with respect to the
election by the executor to pay part or all of the federal estate tax in
installments or, where no federal estate tax return is required to be
filed, an acceleration of payment has occurred by virtue of the
provisions of subsection (g) of section 6166 of the internal revenue
code.

(h) The commissioner of taxation and finance may, for reasonable cause
and if his interests would not be jeopardized thereby, extend the time
for payment of any part of any installment under this subsection,
including any part of a deficiency prorated to any installment under
this subsection, for a reasonable period (1) not in excess of ten years
from the date prescribed for the filing of the return under this article
(without regard to any extension of time to file) or (2) if the date
prescribed for such filing is earlier than the date which is twelve
months after the due date of the last installment, such later date.

(i) If the time for payment of any amount of tax has been extended
under this subsection, interest shall be paid annually together with the
installment of tax on any unpaid portion of such amount (including the
amount of any deficiency), at the rate prescribed in subsection (b) of
section nine hundred seventy-six of this article with respect to
extensions of time for payment of estate tax (other than the extensions
of time provided for in this section) or as otherwise provided for in
subsection (j) of this section.

(j) If the time for payment of any amount of tax has been extended
under this section, the provisions of section 6166 of the internal
revenue code applicable to the payment of interest are modified as
follows:

(1) Interest on the two percent portion of such amount shall be paid
at the rate of two percent per annum. For purposes of this section, the
amount of any deficiency which is prorated to installments payable under
this section, shall be treated as an amount of tax payable in
installments under such section.

(2) For purposes of this paragraph, the term "two percent portion"
means the lesser of fifty-four thousand dollars or the amount of the tax
imposed by this article which is extended as provided in this section.

(3) If the amount of tax imposed by this article which is extended
exceeds the two percent portion, any payment of a portion of such amount
shall, for purposes of computing interest for periods after such
payment, be treated as reducing the two percent portion by an amount
which bears the same ratio to the amount of such payment as the amount
of the two percent portion (determined without regard to this paragraph)
bears to the amount of tax which is extended.

(4) Interest on any portion of the amount of tax which is not
includible in the two percent portion of such amount shall be payable at
the rate provided for in subsection (i) of this section.

(5) (A) Interest payable on any unpaid portion of the amount of tax
due attributable to the first five years after the date prescribed for
payment of the tax shall be paid annually;

(B) interest payable on any unpaid portion of such amount of tax
attributable to any period after the five year period referred to in
subparagraph (A) of this paragraph shall be paid annually at the same
time as and as part of, each installment payment of the tax;

(C) in the case of a deficiency to which subsection (e) of section
6166 of the internal revenue code applies is determined after the close
of the five year period referred to in subparagraph (A) of this
paragraph, interest attributable to such five year period, and interest
assigned under subparagraph (B) of this paragraph to any installment,
the date of payment of which has arrived on or before the date of such
determination, shall be paid upon notice and demand from the
commissioner of taxation and finance; and

(D) if the executor has selected a period shorter than five years,
such shorter period shall be substituted for five years in subparagraphs
(A), (B) and (C) of this paragraph. Any period of time selected for the
purposes of the tax under this article shall in no event be greater than
the period of time selected for the purpose of the estate tax imposed by
the internal revenue code.

(k) The lien of the tax provided for in section nine hundred
eighty-two of this article shall be applicable to the same extent as if
no election had been made to extend the time for payment of estate tax
under this section.