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A00529
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
706
Session of
2019
INTRODUCED BY GREINER, DUNBAR, RYAN, BERNSTINE, READSHAW,
KAUFFMAN, SAYLOR, IRVIN, LONGIETTI, ZIMMERMAN, HILL-EVANS,
PICKETT, B. MILLER, F. KELLER, GILLEN, COX AND GABLER,
MARCH 5, 2019
REFERRED TO COMMITTEE ON FINANCE, MARCH 5, 2019
AN ACT
Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
act relating to tax reform and State taxation by codifying
and enumerating certain subjects of taxation and imposing
taxes thereon; providing procedures for the payment,
collection, administration and enforcement thereof; providing
for tax credits in certain cases; conferring powers and
imposing duties upon the Department of Revenue, certain
employers, fiduciaries, individuals, persons, corporations
and other entities; prescribing crimes, offenses and
penalties," in personal income tax, providing for revocable
trusts treated as part of estate further providing for
returns of married individuals, deceased or disabled
individuals and fiduciaries.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The act of March 4, 1971 (P.L.6, No.2), known as
the Tax Reform Code of 1971, is amended by adding a section to
read:
Section 336.3. Revocable Trusts Treated as Part of Estate.--
(a) For purposes of this article, if both the executor of an
estate and the trustee of a qualified revocable trust elect the
treatment provided under this section, the trust shall be
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treated and taxed as part of the estate and not as a separate
trust for all taxable years of the estate ending after the date
of the decedent's death and before the applicable date.
(b) The election under subsection (a) shall be made not
later than the time prescribed for filing the return of tax
imposed under this article for the first taxable year of the
estate, determined with regard to extensions and, once made,
shall be irrevocable.
(c) As used in this section, the following words and phrases
shall have the meanings given to them in this subsection unless
the context clearly indicates otherwise:
"Applicable date" means:
(1) if no return of tax imposed by Article XXI is required
to be filed, the date which is two years after the date of the
decedent's death; or
(2) if a return of tax imposed by Article XXI is required to
be filed, the date which is six months after the date of the
final determination of the liability for tax imposed by Article
XXI.
"Qualified revocable trust" means any trust or portion of a
trust which was treated under section 2107(c)(7) as owned by the
decedent of the estate referred to in subsection (a) by reason
of a power in the grantor.
Section 1. Section 331(g) of the act of March 4, 1971
(P.L.6, No.2), known as the Tax Reform Code of 1971, is amended
to read:
Section 331. Returns of Married Individuals, Deceased or
Disabled Individuals and Fiduciaries.--* * *
(g) The return for an estate or trust shall be made and
filed by the fiduciary. If two or more fiduciaries are acting
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jointly, the return may be made by any one of them. If the
executor of the estate and trustee of the trust make an election
under section 645 of the Internal Revenue Code of 1986 ( Public
Law 99-514, 26 U.S.C. ยง 645), as amended January 1, 2019, to
treat the income of the trust as part of the estate, the
fiduciary may make and file a joint tax return for the estate
and trust under this subsection for the taxable years whe n the
trust income is reported as part of the estate income in
accordance with section 645 of the Internal Revenue Code of
1986, as amended January 1, 2019. For purposes of this article ,
the estate and trust shall remain separate taxpayers and the
income of the estate and trust shall be calculated and reported
separately. If the income tax liabilities of the estate and
trust are filed on a joint ta x return under this subsection, the
tax liabilities of the estate and trust shall be joint and
several. The provisions of subsection (d) shall be applicable to
a joint tax return filed under this subsection.
Section 2. The addition amendment of section 336.3 331(g) of
the act shall apply to tax years beginning after December 31,
2019.
Section 3. This act shall take effect in 60 days.
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