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Wayne Pa Inheritance Taxation Lawyers – Intro
The Wayne PA Inheritance tax is imposed as a percentage of the value of a decedent’s estate transferred to beneficiaries by will, heirs by intestacy and transferees by operation of law.
The tax rate varies depending on the relationship of the heir to the decedent.
The Pennsylvania inheritance tax taxes assets owned by the decedent at the time of his or her death. Unlike the federal estate tax, there is no minimum dollar amount for the estate to be taxed; all estates of any value are subject to taxation. The inheritance tax return is due within nine months of the death of the decedent.
Wayne Pa Inheritance Taxation Lawyers – Rates
The rates for Pennsylvania inheritance tax are as follows:
- 00.00 percent on transfers to a surviving spouse or to a parent from a child aged 21 or younger;
- 04.50 percent on transfers to direct descendants and lineal heirs;
- 12.00 percent on transfers to siblings; and
- 15.00 percent on transfers to other heirs, except charitable organizations, exempt institutions and government entities exempt from tax.
Wayne Pa Inheritance Taxation Lawyers – Due
Inheritance tax payments are due upon the death of the decedent and become delinquent nine months after the individual’s death. If it is paid within three (3) months of the decedent’s death, a 5 percent discount is granted to the Estate.
In Pennsylvania, the inheritance tax must be paid within nine months of the time of the decedent’s death. If it is not paid within that period of time, the Pennsylvania Department of Revenue may assess penalties and interest.
Wayne Pa Inheritance Taxation Lawyers – Help
Frequently, in our practice, we are confronted with many misconceptions concerning Pennsylvania inheritance tax. The Pennsylvania inheritance tax is a tax on property at the time of someone’s death and is imposed upon the transfer of that property. One common misconception is that spouses have to pay inheritance tax on property that they obtain from their deceased mate. Although that was the case in the past, it is not longer, having been abolished in 1994.
From the value of these resources, we are permitted to deduct certain expenses to arrive at a net valuation for the estate. These expenses include:
- the cost of the funeral,
- the debts of the decedent (including mortgage loans, credit cards, home equity loans, etc.),
- the expenses of the last illness,
- all fees that are paid to the Register of Wills Office; and
- the legal fees for processing the estate, and miscellaneous expenses and fees.
Once the net value has been calculated, the Pennsylvania inheritance tax is applied as follows:
- 04.50 % of that net value to children,
- 12.00 % passing siblings, and
- 15.00 % to other individuals would be taxed in Pennsylvania at a rate of 15%.
Many people do not realize that there are certain types of assets that are exempt from the Pa Inheritance Tax.
- As an example, life insurance proceeds which are paid directly to a beneficiary or are paid to the estate of the decedent are exempt.
- an IRA account held in the decedent’s name, if the decedent had not reached the age of 59 ½, is also exempt.
Sometimes, jointly held property is ignored for tax purposes at the time of death. For example, where a decedent owns a bank account which is titled in the decedent’s name and, let us say, two of his children’s names, the decedent’s one-third interest would be taxed at a rate of 4.5%.
However, if that account was established using only the decedent’s funds, and the decedent dies within one year, then the whole value of the account is taxed, not just a portion of it.
If payment is made within 90 days of the date of death, the department discounts the amount by 5%.
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John B. Whalen, Jr., JD., LL.M., is an AV Peer Review Rated Preeminent 5.0 and Avvo Rated 10.0 Superb. He has obtained over 95 client reviews and peer endorsements premier and prestigious Attorney and Counselor at Law.
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John has amassed over 60 prestigious and premier professional awards and over 5000 client reviews and endorsements. Mr. Whalen has achieved the AV Peer Review Rated Preeminent award from Martindale. He has received the AV Peer Judicial Preeminent award. He has received the Avvo Rated Superb 10.00 award, and the Avvo Rated Top Lawyer award. He has also received the Clients’ Choice Award, and the Top One Percent (1%) award.
He is the recipient of the Legum Magister Post-Doctorate Degree (LL.M.) in Taxation (from the Villanova University School of Law). He is the recipient of the American Jurisprudence Award in Wills, Trusts, and Estates (from the Widener University School of Law).
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