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                                                       PRINTER'S NO. 952

THE GENERAL ASSEMBLY OF PENNSYLVANIA


HOUSE BILL

No. 836 Session of 2007


        INTRODUCED BY DENLINGER, WATSON, BAKER, BARRAR, BASTIAN,
           BENNINGHOFF, BOYD, BUXTON, CALTAGIRONE, CAPPELLI, CLYMER,
           COX, CREIGHTON, CUTLER, ELLIS, EVERETT, FAIRCHILD, GEIST,
           GILLESPIE, GINGRICH, GOODMAN, HARPER, HARRIS, HERSHEY, HESS,
           HICKERNELL, HORNAMAN, HUTCHINSON, KAUFFMAN, M. KELLER,
           KILLION, KOTIK, MACKERETH, MAHER, MAJOR, MARKOSEK, MARSHALL,
           MARSICO, McILHATTAN, MENSCH, METCALFE, MILLARD, R. MILLER,
           MOYER, MUSTIO, NAILOR, O'NEILL, PERRY, PETRARCA, PETRI,
           PICKETT, PYLE, RAPP, RAYMOND, READSHAW, REICHLEY, ROAE,
           ROHRER, ROSS, RUBLEY, SAINATO, SAYLOR, SCAVELLO, SOLOBAY,
           SONNEY, STERN, R. STEVENSON, TANGRETTI, J. TAYLOR, TURZAI,
           WANSACZ AND WOJNAROSKI, MARCH 19, 2007

        REFERRED TO COMMITTEE ON FINANCE, MARCH 19, 2007

                                     AN ACT

     1  Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
     2     act relating to tax reform and State taxation by codifying
     3     and enumerating certain subjects of taxation and imposing
     4     taxes thereon; providing procedures for the payment,
     5     collection, administration and enforcement thereof; providing
     6     for tax credits in certain cases; conferring powers and
     7     imposing duties upon the Department of Revenue, certain
     8     employers, fiduciaries, individuals, persons, corporations
     9     and other entities; prescribing crimes, offenses and
    10     penalties," phasing out inheritance and estate tax
    11     provisions.

    12     The General Assembly of the Commonwealth of Pennsylvania
    13  hereby enacts as follows:
    14     Section 1.  The act of March 4, 1971 (P.L.6, No.2), known as
    15  the Tax Reform Code of 1971, is amended by adding a section to
    16  read:
    17     Section 2104.  Expiration.--The provisions of this article


     1  shall not apply to the estates of decedents dying on or after
     2  January 1, 2010.
     3     Section 2.  Section 2106 of the act, added August 4, 1991
     4  (P.L.97, No.22), is amended to read:
     5     Section 2106.  Imposition of Tax.--(a)  An inheritance tax
     6  for the use of the Commonwealth is imposed upon every transfer
     7  subject to tax under this article at the rates specified in
     8  section 2116.
     9     (b)  This section shall not apply to the estates of decedents
    10  dying on or after January 1, 2011.
    11     Section 3.  Section 2116(a) of the act, amended May 24, 2000
    12  (P.L.106, No.23), is amended to read:
    13     Section 2116.  Inheritance Tax.--(a)  (1)  Inheritance tax
    14  upon the transfer of property passing to or for the use of [any
    15  of the following shall be at the rate of four and one-half per
    16  cent:
    17     (i)  grandfather, grandmother, father, mother, except
    18  transfers under subclause (1.2), and lineal descendants; or
    19     (ii)  wife or widow and husband or widower of a child.] a
    20  grandfather, grandmother, father, mother, except transfers under
    21  subclause (1.2), lineal descendants, wife or widow and husband
    22  or widower of a child shall be at the rate provided in the
    23  following schedule:
    24     (i)  Four and one-half per cent for the estate of a decedent
    25  dying before or during calendar year 2009.
    26     (ii)  Two per cent for the estate of a decedent dying during
    27  calendar year 2010.
    28     (iii)  Zero per cent for the estate of a decedent dying
    29  during or after calendar year 2011.
    30     (1.1)  Inheritance tax upon the transfer of property passing
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     1  to or for the use of a husband or wife shall be:
     2     (i)  At the rate of three per cent for estates of decedents
     3  dying on or after July 1, 1994, and before January 1, 1995.
     4     (ii)  At a rate of zero per cent for estates of decedents
     5  dying on or after January 1, 1995.
     6     (1.2)  Inheritance tax upon the transfer of property from a
     7  child twenty-one years of age or younger to or for the use of a
     8  natural parent, an adoptive parent or a stepparent of the child
     9  shall be at the rate of zero per cent.
    10     (1.3)  Inheritance tax upon the transfer of property passing
    11  to or for the use of a sibling shall be at the rate [of twelve
    12  per cent.] provided in the following schedule:
    13     (i)  Twelve per cent for the estate of a decedent dying
    14  before or during calendar year 2006.
    15     (ii)  Nine per cent for the estate of a decedent dying during
    16  calendar year 2007.
    17     (iii)  Six per cent for the estate of a decedent dying during
    18  calendar year 2008.
    19     (iv)  Four and one-half per cent for the estate of a decedent
    20  dying during calendar year 2009.
    21     (v)  Two per cent for the estate of a decedent dying during
    22  calendar year 2010.
    23     (vi)  Zero per cent for the estate of a decedent dying during
    24  or after calendar year 2011.
    25     (1.4)  Inheritance tax upon the transfer of property that is
    26  jointly held between a child and a natural parent, an adoptive
    27  parent or a stepparent of the child to the natural parent,
    28  adoptive parent or the stepparent shall be at the rate of zero
    29  per cent.
    30     (2)  Inheritance tax upon the transfer of property passing to
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     1  or for the use of all persons other than those designated in
     2  subclause (1), (1.1), (1.2) or (1.3) or exempt under section
     3  2111(m) shall be at the rate [of fifteen per cent.] provided in
     4  the following schedule:
     5     (i)  Fifteen per cent for the estate of a decedent dying
     6  before or during calendar year 2006.
     7     (ii)  Ten per cent for the estate of a decedent dying during
     8  calendar year 2007.
     9     (iii)  Seven per cent for the estate of a decedent dying
    10  during calendar year 2008.
    11     (iv)  Four and one-half per cent for the estate of a decedent
    12  dying during calendar year 2009.
    13     (v)  Two per cent for the estate of a decedent dying during
    14  calendar year 2010.
    15     (vi)  Zero per cent for the estate of a decedent dying during
    16  or after calendar year 2011.
    17     (3)  When property passes to or for the use of a husband and
    18  wife with right of survivorship, one of whom is taxable at a
    19  rate lower than the other, the lower rate of tax shall be
    20  applied to the entire interest.
    21     * * *
    22     Section 4.  Section 2117 of the act is amended by adding a
    23  subsection to read:
    24     Section 2117.  Estate Tax.--* * *
    25     (d)  This section shall not apply to the estates of decedents
    26  dying on or after January 1, 2011.
    27     Section 5.  This act shall take effect immediately.


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