Filing a PA Inheritance Tax Return
Posted by Jason Martin, Esq. on Wed, Jan 18, 2012
In Pennsylvania, decedents' estates are required to file a PA Inheritance Tax Return (Form REV-1500) as part of the probate and estate administration process. A PA Inheritance Tax Return should be filed on behalf of any decedent who (1) resided in Pennsylvania at the time of his or her death, and/or (2) owned or had an interest in reportable property that is subject to inheritance tax.
PA Inheritance Tax Return Filing Guidelines
The Pennsylvania inheritance tax form is the PA REV-1500. An Inheritance Tax Return must be filed within 9 months of the decedent's date of death unless an extension has been properly applied for and granted. Late returns are subject to penalties and interest. Any extension of time granted by the PA Department of Revenue will avoid penalties; however, interest will continue to accrue. If an estimated tax payment is made within 3 months of the date of death, a 5% discount will apply.
A Pennsylvania Inheritance Tax Return must be filed in duplicate with the Register of Wills office of the county wherein the decedent resided at the time of his or her death. The return must be complete and accurate. It is very important to be thorough in completing the return and to attach copies of all documents referenced in the return, including a copy of the Will, expense statements, bank statements, home appraisals, etc.
What is the PA Inheritance Tax Rate?
The PA inheritance tax applies to an estate regardless of the estate's size, and the inheritance tax rate is based on the decedent's relationship to the beneficiary. Notably, the tax rate for asset transfers from one spouse to another is zero. The tax rate for transfers from a parent to children and other lineal descendants is 4.5%. The rate for transfers between siblings is 12%, and the rate for transfers to nieces, nephews and other beneficiaries is 15%.
The inheritance tax rate applies only to the net value of a Pennsylvania estate. Debts, funeral expenses and other estate costs are deducted from the gross estate. A $3,500 family exemption may be available as an additional deduction in certain circumstances as well. Certain property is exempt from the tax altogether, including property jointly owned by spouses. Life insurance proceeds as well as many retirement plans are also exempt from the PA inheritance tax.
Estate Administration Attorney | Blue Bell, PA
The Martin Law Firm is a Pennsylvania estate administration law firm located in Blue Bell, Montgomery County, PA. The Martin Law Firm assists executors and administrators with all stages of the Pennsylvania probate and estate administration process, including the preparation and filing of the PA Inheritance Tax Return. Contact The Martin Law Firm today to schedule a consultation with an experienced PA estate administration attorney.
Jason Martin, Esq. is an experienced PA estate planning attorney serving residents of Norristown, Lansdale, Blue Bell, King of Prussia and the rest of Montgomery County. The Martin Law Firm, located in Blue Bell, PA, also regularly assists personal representatives and executors with the Pennsylvania probate process and other estate administration matters. Contact The Martin Law Firm today for a free consultation.