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COMMONWEALTH OF PENNSYLVANIA
D~p~RTMENT OF REVENUE
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P,-i, ,:~!\'\J':-) 'J,v-;" INHERITANCE TAX
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BUREAU OF INDIVIDUAL TAXES
INHERITANCE TAX DIVISION
PO BDX Z80601
HARRISBURG PA 171Z8-0601
*'
RECORD ADJUSTMENT
~J'\ li: 26 DATE
ESTATE OF
DATE OF DEATH
FILE NUMBER
COUNTY
ACN
..,nf\( f'Ol' - 3
LUuJ i ~" ~
DAVID W REAGER
REAGER I ADLER
2331 MARKET ST
CAMP HILL
PA 17011
REV-1593 EX AFP (03-05)
10-20-2006
MURRAY
07-14-2005
21 05-0835
CUMBERLAND
101
AIIount R_i tted
MARIAN M
MAKE CHECK PAYABLE AND REMIT PAYMENT TO:
REGISTER OF WILLS
CUMBERLAND CO COURT HOUSE
CARLISLE. PA 17013
CUT ALONG THIS LINE
NOTE: To insure proper credit to your account. sub.it the upper portion of this for. with your tax pay-.nt.
--+ RETAIN LOWER PORTION FOR YOUR RECORDS +--
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REV-1593 EX AFP (03-05)
ESTATE OF MURRAY
MARIAN
.. INHERITANCE TAX RECORD ADJUSTMENT ..
10-20-2006
M FILE NO. 21 05-0835
ADJUSTMENT BASED ON:
VALUE OF ESTATE:
PROTEST BOARD DECISION
1. R..l Estate (Sch.dule A)
2. Stocks and Bonds (Schedule B)
3. Closely Hald Stock/Partnership Interest (Schedule C)
4. Mortgagas/Notes Receivable (Schedule D)
5. Cash/Benk Deposits/Hisc. Personal Property (Schedule E)
6. ~ointly Owned Property (Schedule F)
7. Transfers (Schedule G)
8. Total Assets
DEDUCTIONS AND EXEMPTIONS:
9. Funeral Expanses/A~inistrative Costs/
Hiscel1l1118OUs Expenses (Schedule H)
Debts/Mortgage Liabilities/Liens (Schedule I)
Total Deductions
Net Value of T_ Return
Charitable/Sover~tal Bequests; Non-elected 9113 Trusts
Net Value of Estate Subject to T_
10.
11.
12.
13.
14.
TAX:
15.
16.
17.
18.
19.
~ount of Line 14 at Spousal rate
AIIount of Line 14 taxable at Lineal/Class A rate
ABount of Line 14 at Sibling rate
A~t of Line 14 taxable at Collateral/Class B rate
Principal T_ Due
ACN 101
DATE
(1)
(2)
(3)
(4)
(5)
(6)
(7)
.00
6.130.00
.00
.00
435.431.55
40.004.08
62.389.09
(8)
543.954.72
(9)
(10)
8.797.99
.00
(11)
(2)
(3)
(4)
(Schedule ~)
8.797.99
535.156.73
535.156.73
.00
(5)
(6)
(7)
(8)
.00 X 00 =
.00X045=
.00 X 12 =
.00 X 15 =
(19)
.00
.00
.00
.00
.00
TAX CREDITS:
1<1:"I:.Lr. ....J AMOUNT PAID
DATE NUtlBER INTEREST/PEN PAID (-)
TOTAL TAX CREDIT .00
BALANCE OF TAX DUE .00
INTEREST AND PEN. .00
TOTAL DUE .00
· IF PAID AFTER DATE INDICATED. SEE REVERSE
FOR CALCULATION OF ADDITIONAL INTEREST.
( IF TOTAL DUE IS LESS THAN $1. NO PAYMENT IS REQUIRED. U
IF TOTAL DUE IS REFLECTED AS A "CREDIT" (CR). YOU HAY BE DUE
A REFUND. SEE REVERSE SIDE OF THIS FORH FOR INSTRUCTIONS.)
BOARD ()c APPEALS
DEPT. 281~1
HARRISBURG, PA 17128-1021
COMMONWEALTH GF PENNSYLVANIA
DEPARTMENT OF REVENUE
DAVID W REAGER ESQ
REAGER & ADLER
2331 MARKET ST
CAMP HILL PA 17011
IN RE ESTATE OF:
MURRAY MARIAN M
DOCKET NO. :
TAX TYPE:
APPEAL TYPE
FILE NUMBER:
ACN:
APPRAISEMENT:
PETITION FILED:
EXAMINER:
MAILING DATE:
DECISION AND ORDER
0608933
Inheritance
Protest
2105-0835
101
3/27/2006
4/28/2006
JEFFREY HOLLEN BUSH
Direct Dial: (717) 783-7891
Fax: (717) 787-7270
Email:jhollenbus@state.pa.us
October 13, 2006
In its appraisement and assessment of the original inheritance tax return, the
Department concluded that the Credit Trust created under Article Fourth of decedent's Will
allowed for distributions of principal to decedent's issue during the lifetime of decedent's
surviving spouse. Absent a request for a future interest compromise, the Department
imposed tax on the $494,222.65 Trust at the 4.5% lineal rate, the highest rate in the chain of
potential distributions. Petitioner is protesting that action by arguing that decedent's children
disclaimed any interest they may have in the Trust during the lifetime of their father.
Article Fourth of decedent's Will directs the trustee to distribute the net income of the
Credit Trust to the decedent's spouse for life. In addition, the trustee may payor apply as
much of the principal as desirable and necessary for the health, support and maintenance of
decedent's spouse, after taking into account other available resources. Finally, the trustee
may distribute principle for the health, support, maintenance, and education of decedent's
children.
'MUR~A Y MARIAN M
BOARD DOCKET NO. 0608933
Page 2 of 2
Section 2113 of the Inheritance and Estate Tax Act of 1991,72 P.S.9 9113, as
amended, defers the taxability of assets transferred for the sole use of the transferor's
surviving spouse during the surviving spouse's entire lifetime, unless the estate elects not to
defer the taxability. . The term "sole use" means the surviving spouse is entitled to all income
and principal distributions from the trust.
Petitioner has provided a copy of a timely filed disclaimer from each of decedent's
children relinquishing any interest they may have in the Trust during the lifetime of their father.
As a result, it is the opinion of this Board that the Credit Trust now qualifies as a sole use trust
under Section 2113 of the 1991 Act, as amended.
Accordingly, it is hereby Ordered that the protest is sustained. The Department is
directed to issue an amended appraisement and assessment which defers taxation of the
$494,222.65 Credit Trust until the death of decedent's surviving spouse.
FOR THE BOARD OF APPEALS
GERARD J. SALLAVANTI, CHAIRMAN
JOSEPH R. SLEEK, MEMBER
A STATEMENT OF ACCOUNT WILL BE MAILED TO YOU BY THE BUREAU OF
INDIVIDUAL TAXES.
ANY APPEAL FROM THIS DECISION MUST BE FILED WITH THE ORPHANS' COURT
WITHIN SIXTY (60) DAYS OF RECEIPT OF THIS DECISION.
IF YOU REQUIRE THIS INFORMATION IN AN ALTERNATE FORMAT UNDER THE
PROVISIONS OF AMERICANS WITH DISABILITIES ACT OF 1990, PLEASE CALL (717)
783-3664, OR FOR SERVICES FOR TAXPAYERS WITH SPECIAL HEARING AND
SPEAKING NEEDS: 1-800-447-3020 (TT ONLY).