Inheritance Tax: PA Inheritance Information Notice

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DelcoEE
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Joined: Thu Feb 02, 2017 9:54 pm

Inheritance Tax: PA Inheritance Information Notice

Post by DelcoEE » Tue Feb 13, 2018 7:52 pm

I am helping a relative settle an estate. Our aunt passed in Pennsylvania last July. She had a will and all her financial accounts had named beneficiaries. Therefore, in her case the Inheritance Tax Return (Form Rev-1500) is straightforward. The only problem is of her 6 different bank accounts, only one bank, Prudential, sent a “Pennsylvania Inheritance Information Notice” which documents the account balance at time of death. I was under the impression that all banks and financial institutions should sent out notices to the heirs and the value on the notices is what should be used on the PA schedule E to document the taxable amount of inheritance.

We have all my aunt’s financial records so we know the taxable amount of money at time of death but I though you needed to use the “Pennsylvania Inheritance Information Notice” to officially document the amount of taxable inheritance.

To put it another way, shouldn't all banks send out “Pennsylvania Inheritance Information Notice” to ensure accurate and uniform documentation of inherited money?
thanks in advance for your help.

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munemaker
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Re: Inheritance Tax: PA Inheritance Information Notice

Post by munemaker » Tue Feb 13, 2018 10:02 pm

I am not a lawyer but I did take an estate in PA through probate last year. There were 6 different financial institutions involved and none of them sent the notice you mentioned. You just list the number of shares and the value on the date of death on the inheritance tax return. You don't need the document you described.

DelcoEE
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Joined: Thu Feb 02, 2017 9:54 pm

Re: Inheritance Tax: PA Inheritance Information Notice

Post by DelcoEE » Fri Feb 16, 2018 11:30 am

THANKS !!! I was wondering what the state of PA considers an official record for "date of death valuation". It appears you are liable for the tax but not required to attach any supporting documentation.

FYI - Vanguard sent me "date of death valuation" for the retail account but not the IRA account.

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munemaker
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Re: Inheritance Tax: PA Inheritance Information Notice

Post by munemaker » Fri Feb 16, 2018 6:58 pm

DelcoEE wrote:
Fri Feb 16, 2018 11:30 am
THANKS !!! I was wondering what the state of PA considers an official record for "date of death valuation". It appears you are liable for the tax but not required to attach any supporting documentation.

FYI - Vanguard sent me "date of death valuation" for the retail account but not the IRA account.
Right! I attached zero documentation and the form was accepted as submitted. It did take the Commonwealth about 6 months to get back to us though.

You should be prepared to provide evidence if you are requested. Statements from the financial institutions should contain the necessary information.

Also, if you prepay the inheritance tax, you get a small discount. Since you don't know the exact number, you have to estimate. We paid a little over and also held back final payment to beneficiaries until the submittal was approved and the overpayment refunded. We did not want to be in a position to ask beneficiaries to return any money if the Commonwealth took exception to anything we submitted. Very likely the beneficiaries spent the inheritance the day they received it.

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