HomeMy WebLinkAbout07-31-06
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OFFICE OF CHIEF COUNSEL
DEPT. 281061
HARRISBURG, PA 17128-1061
COMMONWEALTH OF PENNSYLVANIA
DEPARTMENT OF REVffJ}.j':(J(f.[:i
July 26, 20fJ~s ,-'_".:: I f);, 1: 55
Lora A. Kulick
Direct Dial: (717) 346-4644
Ikulick@state.pa.us
Fax: (717) 772-1459
Ann Margaret Grab, Esq.
Griffith, Strickler, Lerman,
Solymos & Calkins
110 S. Northern Way
York, PA 17402-3737
Re: Estate of Melissa Ann Potter, deceased
Court of Common Pleas of Cumberland County
Dear Ms. Grab:
The Department of Revenue received a copy of the draft
petition for Court Approval of Settlement to be filed on behalf
of the above-referenced Estate in regard to a wrongful death and
survival action. It was forwarded to this Office for the
Commonwealth's approval of the allocation of the proceeds paid to
settle the action.
Pursuant to the Petition, on May 23, 2005, the eighteen year
old decedent died upon sustaining injuries in a motor vehicle
accident. The intestate heirs to decedent's estate are her
parents. Therefore, any proceeds paid to settle the survival
action would pass to decedent's parents and would be subject to a
zero percent inheritance tax rate. 72 P.S. ~ 9116 (a) (1.2) .
Accordingly, regardless of the allocation of the subject
proceeds, there would be no inheritance tax consequences.
Please be advised that based upon these facts and for
inheritance tax purposes only, this Department has no objection
to the proposed allocation of the gross proceeds of this action,
$75,000 to the wrongful death claim and $25,000 to the survival
claim. Proceeds of a survival action are an asset included in
the decedent's estate and, although these proceeds are subject to
the imposition of a zero percent inheritance tax rate in this
instance, they must be reported on decedent's Pennsylvania
inheritance tax return. 42 Pa.C.S.A. ~ 8302; 72 P.S. ~~ 9106,
9107. Costs and fees must be deducted in the same percentages as
the proceeds are allocated. In re Estate of Merryman, 669 A.2d
1059 (Pa. Cmwlth. 1995).
if
Ann Margaret Grab, Esq.
July 26, 2006
Page 2
I trust that this letter is a sufficient representation of
the Department's position on this matter. As the Department has
no objections to the Petition, I will not be attending any
hearing regarding it. Please contact me if you or the Court has
any questions or requires anything additional from this Office.
Sincerely,
Lora A. KulicK
Assistant Counsel
cc:
Clerk of Court' /
LAK: dmm
No. 17565
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