Pennsylvania Inheritance tax – IRAs Taxable?
The PA Form 1500 instructions on whether IRAs are taxable are inscrutible, and I can’t decide one way or another. This should be explained in a simple manner for such a common situation, but it is not. PA generally doesn’t tax retirement income of any kind, but does this principle extend to this state’s unique inheritance tax system?
Permalink Submitted by Al Fry on Thu, 2009-12-17 04:28
Not up on PA Inheritance tax, however most all assets transferred are subject to the tax. There are generally exemptions for certain assets ansd for various classes of beneficiaries. This should all be detailed in the PA estate/inheritance tax return instructions. Al
Permalink Submitted by Anonymous (not verified) on Mon, 2009-12-21 18:37
Generally, IRAs are taxable in PA for inheritance tax purposes on PA-1500 Schedule-G. If the decedent was over 59 1/2 at the time of death, the IRA will be subject to inheritance tax. The rate is determined by the relationship of the decedent to the beneficiary.
However, withdrawals by the beneficiary that are coded as a 4 “death” are not taxable for PA Income Tax purposes.
This is the info I received from PA Dept. of Revenue last year on questioning them about same issue.
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