Important Service Announcement: Based on user feedback we are not shutting down the TaxAlmanac.org website however the site is now an archived version as of June 2014. While all of the existing discussion threads and commentary will be preserved you will no longer be able to edit content, post to forums or create additional logins.
Discussion:Pennsylvania Inheritance Tax Idea
From TaxAlmanac, A Free Online Resource for Tax Professionals
From TaxAlmanac
Discussion Forum Index --> Tax Tips --> Pennsylvania Inheritance Tax Idea
Podolin (talk|edits) said:
| 16 November 2011
|
| My first post on TA, about 8 months or so ago, was this: Discussion:Save State Inheritance Tax at No Fed Gift or Estate Tax Cost? . Then, it was the germ of an idea. Now, I have an actual situation in which to use it, so would really appreciate a critique from a PA professional. Widow, 1 child, estate about $1,000,000 (so no Federal estate tax probably) will leave entire estate to adult daughter and son. PA inheritance tax would be 4.5% of that, or roughly $45,000. To the extent she feels OK doing it, in the sense of trusting her daughter and son, she can add them both as co-owners of various accounts (cash, CDs, stocks, etc>) and the result would be that on her death, the state views her taxable estate to be 1/3 of the total such accounts. So, if she has, say, $500,000 in cash and stocks and does this, it reduces PA inheritance tax by 2/3 of 4.5% of $500,000, or $15,000. Not a fortune, but easy to do and better in their pockets than PA's. Thanks.
|
KatieJ (talk|edits) said:
| 17 November 2011
|
| Len, I'm not in PA, but I can refer you to Pa. Stat. Ann. 72 ยง9107(c)(3), which provides that a transfer of property within one year of the transferor's death is considered a transfer in contemplation of death, and is included in the taxable estate to the extent it exceeds $3,000. I would guess that this will work as long as the transferor survives more than one year after the transfer.
|
Podolin (talk|edits) said:
| 17 November 2011
|
| Thank you, Katie. I was aware of the 1-year issue (and mentioned it in my long-ago posting). But did you, even though not in PA, research this and agree that is the only concern? If so, that is service beyond the call of duty, and I thank you.
|
To join in on this discussion, you must first
log in.
