Estate planning rules in Pennsylvania
Key takeaway
Pennsylvania estate planning rules address wills and transfers at death for property owners, spouses and adult children. A Pennsylvania will is in writing and signed by the testator at the end. A Pennsylvania transfer on death through beneficiary-form registration takes effect by contract between the owner and the registering entity and is not testamentary.
Wills and estate distributions
Pennsylvania permits a testator unable to sign a will to make a mark in the presence of two witnesses. The witnesses sign in the testator's presence.
Pennsylvania permits distribution of qualifying estate personal property without administration when its gross value does not exceed $50,000. Real estate is excluded from the calculation.
Pennsylvania intestate estates without familial heirs pass first to an endowed community fund in the decedent's municipality. An endowed community fund in the school district receives the estate if no qualifying municipal fund exists.
Digital assets and disclosure authority
Pennsylvania's digital asset provisions apply to custodians when the user resides in Pennsylvania or resided there at death. Employer digital assets used in the ordinary course of business are excluded.
Pennsylvania permits a user to direct disclosure or nondisclosure through a custodian's online tool.
Pennsylvania conditions disclosure of a deceased user's electronic communication content on the user's consent or court direction. The personal representative provides specified records.
Pennsylvania provides for disclosure of communication content to an agent whose power of attorney expressly grants that authority. The agent supplies a copy and a certification under penalty of perjury that the power of attorney is in effect.
Pennsylvania gives a custodian 60 days after receipt of the specified information to comply with a fiduciary's or designated recipient's request for digital asset disclosure or account termination.
Trust administration and guardianship
Pennsylvania permits a trustee to transfer a trust's situs without court approval if all qualified beneficiaries consent in writing. Notice of a proposed situs change goes to qualified beneficiaries at least 60 days before the intended date.
Pennsylvania's trustee impartiality duty calls for equitable treatment of beneficiaries in light of the trust's purposes. Equal treatment is not the standard.
Pennsylvania applies its directed trust provisions when trust terms let a person other than the trustee direct the trustee or change the trust's terms.
Pennsylvania law prefers less restrictive alternatives to guardianship. Limited guardianship applies if no sufficient alternative exists. A sufficient less restrictive alternative precludes appointment of a guardian.
Inheritance tax and fiduciary income tax
Pennsylvania inheritance tax rates are 0% for surviving spouses and certain parent transfers, 4.5% for direct descendants, 12% for siblings and 15% for other heirs.
Pennsylvania resident estates or trusts may claim a credit for income tax paid to another state on income taxed by both states in the same year. The credit is capped at Pennsylvania tax owed.
Pennsylvania uses income amounts and sources specified in the governing instrument to determine distribution deductions. Otherwise, applicable distributable net income generally limits the deduction and beneficiary taxation.
Pennsylvania does not apply a federal-style income-in-respect-of-a-decedent rule. Under a cash-basis assumption, the final return includes income received through death.
Thresholds and rates change. Check the state's own current figures.
Thresholds and rates change. Check the state's own current figures.
Common questions
Who orders a Pennsylvania estate distribution without administration?
Pennsylvania's orphans' court may order the qualifying distribution on an interested party's petition. The distribution proceeding concerns personal property from the estate of a decedent domiciled in Pennsylvania.
Which Pennsylvania disclosure direction takes priority?
Pennsylvania gives an online-tool direction priority over a contrary direction in an estate-planning record if the custodian's tool allows the user to change or delete the direction at all times.