Klenk Law

Proper Deductions from an Estate in Philadelphia – What You Should Know

Posted on Sun Nov 9, 2014, on Probate and Estate Administration

From our “Ask a Question” Mailbag: Proper Deductions from an Estate in Philadelphia

Most Recently Updated July 7, 2018

“My mother’s Philadelphia house needs repairs before I sell it as executor. Will the repair costs be deductible against the Pennsylvania Inheritance Tax?”

Proper Deductions from an Estate in Philadelphia

Proper Deductions from an Estate in Philadelphia

The Pennsylvania Inheritance Tax is levied on the net estate value, meaning the fair market value of the estate’s assets less expenses and debts.

If repairing the house for sale is reasonable, and the expenses paid are reasonable, they will be deducted from the sale proceeds when calculating the net estate.

What Should I do?

As an executor, you need be careful about spending money to repair the house. If the repairs end up not increasing the home’s value, the Department of Revenue may not allow the deduction and the heirs may also object to the expenses. The heirs could ask the Orphans’ Court to surcharge you for expending estate funds unreasonably, and ask you to make up the loss.

Generally, repair costs are deductible as an expense on the Pennsylvania Inheritance Tax return, but be careful to document the expenses and, if possible, have your Philadelphia Probate Attorney obtain written permission and agreement from all interested beneficiaries prior to you making the expenditure.

More Probate Questions?

Knowing what you can and cannot deduct from an estate is only part of the overall probate process. By all means, if you wish to learn more, please read my more detailed article, The Probate Process All You Need to Know.

In Conclusion: Proper Deductions from an Estate in Philadelphia

I hope that this article was helpful in explaining deductions from an estate. Further, I included links to even more detailed information on my website. Therefore, please contact me and let me know how I did. Certainly, your comments and questions are welcome!

Let our Probate Lawyers help walk you through what can be a confusing process. To begin with, call to speak to one of our experienced Probate Attorneys.  By all means, our lawyers are ready to answer your questions. In fact, feel free to contact our office for a free consultation. Ultimately our goal is to make the process as painless as possible!

Wills, Trusts, Probate, and Estate Litigation, It’s All We Do

Peter Klenk, Probate Lawyer

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Estate Administration, Estate Tax, Income Tax Deductions, Pennsylvania, Philadelphia, Probate Attorney, Probate Lawyer

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