1Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
2act relating to tax reform and State taxation by codifying
3and enumerating certain subjects of taxation and imposing
4taxes thereon; providing procedures for the payment,
5collection, administration and enforcement thereof; providing
6for tax credits in certain cases; conferring powers and
7imposing duties upon the Department of Revenue, certain
8employers, fiduciaries, individuals, persons, corporations
9and other entities; prescribing crimes, offenses and
10penalties," further providing for transfers not subject to
11tax.

12The General Assembly of the Commonwealth of Pennsylvania
13hereby enacts as follows:

14Section 1. Section 2111 of the act of March 4, 1971 (P.L.6,
15No.2), known as the Tax Reform Code of 1971, is amended by
16adding a subsection to read:

1Section 2111. Transfers Not Subject to Tax.--* * *

2(t) The following shall apply:

3(1) A transfer of all business assets, including real estate
4between members of the same family, provided that:

5(i) After the transfer, all assets, including real estate, 
6continue to be devoted to the same business <-by members of the 
7same family for a period of five years beyond the transferor's 
8date of death. An asset under this article which is no longer 
9devoted to the same business <-by members of the same family 
10within five years beyond the transferor's date of death shall be 
11subject to inheritance tax due the Commonwealth under section 
122107, in the amount that would have been paid or payable on the 
13basis of valuation authorized under section 2121 for nonexempt 
14transfers of property, plus interest accruing as of the 
15transferor's date of death, at the rate established in section 
162143.

17(ii) A tax imposed under section 2107 shall be a lien in
18favor of the Commonwealth upon the property no longer being
19devoted to the same use, collectible in the manner provided for
20by law for the collection of delinquent taxes, including the
21personal obligation of the owner of the property at the time of
22the change of use.

23(iii) Every owner of any asset exempt under this subsection
24shall certify to the department on an annual basis that the
25asset qualifies for this exemption and shall notify the
26department within thirty days of any transaction or occurrence
27causing any asset to fail to qualify for the exemption. Each
28year the department shall inform all owners of their obligation
29to provide an annual certification under this subparagraph. The
30certification and notification shall be completed in the form

1and manner as provided by the department.

2(2) Subclause (1) shall apply to the transfer of assets 
<-3between members of the same family if the business is owned
4wholly by members of the same family before the transfer. For
5the purposes of this subsection, business assets shall also
6include any asset leased to a business owned wholly by members
7of the same family before the transfer by a member of the same
8family.

9Section 2. The addition of section 2111(t) of the act shall
10apply to the estates of decedents dying after June 30, 2013.

11Section 3. This act shall take effect in 60 days.