Move to broaden exceptions for inheritance tax stalled in Pa.
A Democratic-backed proposal in the Pennsylvania House would change the rules for inheritance taxes to exempt not just married couples and young children, but all domestic partner couples.
If someone is married, and his or her spouse dies, any inherited property doesn’t come with the state’s usual 15 percent tax.
The same applies if a child under 21 inherits property from a deceased parent.
State Rep. Babette Josephs, D-Philadelphia, says she wants the same rules to apply to domestic partners – those who aren’t married either because they can’t or won’t.
Stringent requirements would ensure only people in demonstrably committed relationships would get the exemption, she said Wednesday.
“They might not have any of this — joint liability in a mortgage lease or loan, primary beneficiary under life insurance, a primary beneficiary under the will, a durable power of attorney,” she said. “I mean, most couples don’t have any of that.”
David Jacobs, who lives with his partner of 17 years in Philadelphia, says they had a health scare last year. If his partner had died, Jacobs said, he would have had to pay a 15 percent inheritance tax on the home they own together.
“My married neighbors don’t have to pay this inheritance tax,” he said. “In their case, the state rightfully acknowledges the unfair burden that would be placed on the survivor. My situation would be no different.”
The bill was referred to a GOP-controlled House committee last September, where it has sat since.
No vote is scheduled.
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