What Death Taxes are Due at Death?

Death Taxes due within nine (9) months after the date of death are the Federal Estate Tax Return and the Pennsylvania Inheritance Tax Return.

Many estates will not be subject to the Federal Estate Tax, depending on the size of the gross estate and the federal estate tax law in effect. Your attorney will guide you in determining which assets are subject to the federal estate tax and in preparing and filing the return.

Pennsylvania Inheritance Tax must be filed regardless of the size of the gross estate, even if debts and expenses exceed the value of the gross estate. The debts of the decedent and certain funeral expenses and administration expenses of the estate will be deductions from the gross estate and reduce the amount of inheritance tax due.

Property passing to a surviving spouse and also life insurance proceeds are not subject to Pennsylvania inheritance tax. If either a payment on account, or the inheritance tax return itself with payment, is filed within 90 days after death, a five (5%) percent discount will apply to the tax due. Currently, the tax rates are as follows:

Surviving Spouse  — 0%

Grandparents, parents, children, grandchildren, and certain other lineal descendants of the decedent — 4.5%

Decedent’s siblings — 12%

Others — 15%