A Last Will and Testament is a written document designed to give
detailed instructions as to what will happen upon the death of
the person who wrote the “Will” called a Testator or Testatrix. The “Will” must be written but can be handwritten by the
Testator. The primary purpose of the “Will” is to gift, give
away, sell or otherwise transfer the worldly possessions of the
Testator to those people or charitable organization named in the
A personal representative called an Executor or Executrix should
be named in the “Will” to carry out the intent of the
instructions of the “Will”. The Executor legally steps into the
shoes of the decedent. Performs any distribution of assets to
heirs can begin the Executor must first pay all of the funeral
expenses, debts of the decedent and taxes.
A Last Will and Testament is a must for everyone and can be
When a person dies, it is often necessary to follow formal
procedures in settling the estate. The process is called Estate
Administration. Both state and federal law establish certain
requirements which must be followed. Administration includes
procedures and requirements relating to collecting of assets,
satisfying of obligations such as debt, expenses and tax
preparation, and filing and distribution of property to heirs
- What should be done first?
If someone close to you has died, make sure that their home is
secure and nothing is lost or destroyed. It is illegal in
Pennsylvania to enter a safe deposit box without notifying the
Pennsylvania Department of Revenue or its authorized
representative so that the contents of the box can be
inventoried. Shortly after the funeral, an attorney should be
contacted by the survivors to discuss the estate. The attorney
will provide advise, determine whether administration will be
required and explain what procedures will be involved. If there
is a will, the person named as executor should protect the will
and give it to the attorney at the first meeting.
- When is formal estate administration required?
In almost every case when a person dies having personal property
or real estate, an estate must be administered.
- Who administers and estate?
An estate is administered by a personal representative. If there
is a will, the personal representative named in the will is the
executor. If there is not a will, it is the administrator, who
is chose by the Register of Wills. The personal representative
works with an attorney in complying with necessary legal
- What does a personal representative do?
The personal representative is charged with the actual
administration of an estate, and has the responsibility for
performing all functions that are required. This includes
following the directions of the decedent (the deceased person)
if there is a will, or following the requirements of the law if
there is not a will. The representative also gathers information
about the assets of the estate and the debts, notifies the
beneficiaries under the will or the intestate heirs, pays all
debts and expenses as well as inheritance taxes, and distributes
the assets to the beneficiaries.
- Should I have an attorney to assist in the administration of the
As a practical matter, it is very difficult for a non lawyer to
correctly follow the required procedures in administering an estate
without the assistance of an attorney. The personal representative selects
the attorney for the estate, often the same attorney who
prepared the will. An attorney can also be located by calling
the Pennsylvania Bar Association’s Lawyer Referral Service
toll-free at 1-800-692-7375. Most counties have this same
service at the local level. Check your yellow pages under
“attorneys” for more details.
- What happens during the Administration?
At the beginning, all assets of the estate, including personal
possessions and real estate are inventoried and sometimes
physically gathered. All of the beneficiaries (if there is a
will) or heirs (if there is no will) are located. They are told
that they were named in the will or have a legal right to
receive an inheritance. Funeral expenses, debts, state and
federal taxes are paid, and necessary tax returns are filed.
Sometimes administration may involve the short-term management
of a business or corporation or sale of a business or stock in a
corporation. There could also be sale of real estate which was
owned by the deceased.
At the conclusion of the administration period, a final
accounting of all assets is presented for approval to the county
court. After approval, distribution of the balance of the assets
- What fees are paid during administration?
In addition to court costs, fees (usually based on a percentage
of the gross value of the estate) are paid to the attorney and
to the personal representative. These fees are paid out of the assets of the
estate. Fee arrangements should be discussed during the first visit to the
attorney who will be involved in the administration of the
Inheritance Tax for PA Residents
The tax rate for Pennsylvania Inheritance Tax is 4.5 percent for
transfers to direct descendants (lineal heirs), 12 percent to
transfers to siblings, and 15 percent for transfers to other
heirs (except charitable organizations, exempt institutions, and
government entities which are exempt from tax). Property owned
jointly between husband and wife is exempt from inheritance tax,
while property inherited from a spouse, or from a child
twenty-one or younger by a parent, is taxed at a rate of 0
Inheritance Tax returns are due nine calendar months after a
person’s death. The responsible party is the person named in the
will as executor(trix), or is the person dies without a will,
the individual who is approved as administrator(trix) by the
Register of Wills after a petition is filed. If no executor or
administrator is named and property or transfers exist, then the
person receiving the property is required to file a return and
pay the tax.
- What are the Inheritance Tax rates for a surviving spouse?
The rate of tax imposed on transfers to the surviving spouse are
based on the date of death of the decedent as follows:
Date of death on or after January 1, 1995 - 0% tax
Date of death after June 30, 1994, and before January 1, 1995
- 3% taxDate of death before July 1, 1994 - 6% tax
- Who are considered to be lineal heirs and lineal descendants for
of Inheritance Tax?
Lineal heirs are grandfather, grandmother, father, mother, and
their children. “Children” include natural children, whether or not
they have been
adopted by others, adopted children and stepchildren.
“Lineal descendants” include all children of the natural parents
descendants, whether or not they have been adopted by others,
descendants and their descendants and step descendants.
- Is there a discount allowed on PA Inheritance Tax?
The tax is due at the date of death and becomes delinquent nine
the date of death. There is a discount of 5% of the tax paid or
due, whichever is less, when the payment is made within three
months of the
date of death.
- What property is subject to Inheritance Tax?
All real property and all tangible personal property of a
including but not limited to cash, automobiles, furniture,
jewelry, etc., located in Pennsylvania at the time of the
is taxable. All intangible property of a resident decedent
stocks, bonds, bank accounts, loans receivable, etc. is also
regardless of where it is located at the time of decedents
In the case of a non resident decedent, all real property and
tangible personal property located in Pennsylvania at the time of the
death is taxable. Intangible personal property of a nonresident
Jointly owned property with right of survivorship except between
wife, including but not limited to real estate, securities, bank
etc. is taxable to the extent of the decedent's fractional
interest in the
joint property (calculated by dividing the value of the joint
the number of joint owners at the time of the decedent’s death). Joint
property is taxable even though the decedent’s name was added as
a matter of
convenience. Further, if the decedent created the joint interest
property within a year of his/her death, the full value of the
taxable in the decedent’s estate.
- Can the funeral expenses and unpaid bills of the decedent be deducted from
the amount subject to tax?
Yes, Unsatisfied liabilities incurred by the decedent prior to
are deductible against his her taxable estate. In addition to
incurred by the decedent or the estate, the cost of
administration of the
estate, attorney fees and fiduciary fees incurred to administer
funeral and burial expenses, including the cost of burial lot,
grave marker, and other related burial expenses, are deductible.
For the sake of convenience, I put my mother’s name on my
savings account. Recently my mother died and now I am being told that I will have
to pay an
Inheritance Tax on my own money. Can this be correct?
Under the Inheritance Tax law, the account was jointly owned
because you and
your mother had equal access to the account. Therefore, in this
the survivor is taxed on one-half of the amount of the account.
- Was the “widows tax” repealed in Pennsylvania?
Previously, transfers to surviving spouses were taxed and this
known as the ‘widows tax”. The tax rate for transfers to a
is now zero when the decedent died on or after January 1, 1995. A
Pennsylvania widow or widower pays no tax on assets which are
a deceased spouse.
- What is the family exemption and how much can be claimed?
The family exemption is a right given to specific individuals to
claim certain types of decedent’s property in accordance with
of the Probate, Estate and Fiduciaries code. For decedents dying
January 29, 1995, the family exemption is $3,500.00. From June
27, 1974 through January 29, 1995, the amount of the family exemption was
- Who is entitled to claim the family exemption?
The family exemption may be claimed by a spouse of a decedent
who died as a
resident of Pennsylvania. If there is no spouse, or if the
forfeited his/her rights, then any child of the decedent who is
a member of
the same household as the decedent may claim the exemption. In
that there is not spouse or child, the exemption may be claimed
by a parent
or parents who are members of the same household as the
family exemption is allowable against assets which are passed on
without a will.
- Where is the Inheritance Tax return to be filed?
If the decedent was a resident of the Commonwealth of
Pennsylvania at the
time of his/her death, the inheritance tax return is to be filed
in duplicate with the Register of Will in the county were the
decedent was a
resident at the time of his/her death. If the decedent was a
Pennsylvania, with the Register of Will that issues Letters
Letters of Administration, if any. Otherwise, the inheritance
tax return is
to be filed with the Department of Revenue, Bureau of Individual
For additional information, call (717) 787-8327 or write to the Inheritance
Tax Division at:
PA Department of Revenue
Bureau of Individual Taxes
Harrisburg, PA 17128-0601
SPECIAL NOTE: THIS INFORMATION IS TO INFORM NOT TO ADVISE. IT IS
BASED ON PENNSYLVANIA LAW. THE STATEMENTS ARE GENERAL AND INDIVIDUAL
FACTS IN A GIVEN CASE MAY ALTER THEIR APPLICATION OR INVOLVE OTHER LAWS NOT REFERRED TO HERE.
THIS INFORMATION HAS BEEN MADE AVAILABLE TO YOU AS A PUBLIC
SERVICE BY THE PENNSYLVANIA BAR ASSOCIATION, PA DEPARTMENT OF REVENUE AND THE
PENNSYLVANIA BAR TRUST FUND, WITH THE COOPERATION OF YOUR LAWYER AND LOCAL
A Power of Attorney is a written document designed to give legal
authority to transact the affairs of the person who wrote the Power of
Attorney called a “Grantor”. The Power of Attorney must be signed by the
Grantor, the signature notarized and the document filed in the local county
recorders office. The primary purpose of the Power of Attorney is to
empower a designed friend or family member called an “Agent” with the duty
to take care of the Grantor and his or her affairs.
The “Agent” legally steps into the shoes of the “Grantor”
usually upon the Grantor’s incapacitation. The Power of Attorney can be revoked
by the “Grantor” and reissued to a second “Grantee”. The Authority
granted in the Power of Attorney ends upon the death of the “Grantor”. A Power
of Attorney is a must for most elderly people especially widows and
A Living Will is a written document commonly referred to as the
right to die with dignity document. The Living Will is designed to give
detailed instructions as to what will happen should a person become so
incapacitated physically and mentally, that there is no longer any quality of
life. Once it has medically been determined that a person is in a
vegetative catatonic state and that the removal of life sustaining hospital procedure
would cause death the “Living Will” grants legal authority to remove the
life sustaining hospital procedure.
A Living Will is expensive to prepare and generally recommended
for the elderly.
The sale or purchase of real estate can be complicated if not
properly by a real estate professional. Every property bought or
sold must first begin with a written contract called an “Agreement of
Sale”. Remember everything is negotiable and the terms of the “Agreement of
Sale” are dictated by the buyer and seller.
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