As many of you may know, our state is the last state in the Northeast to not allow gay couples to marry. A statute was put into effect in PA in 1996 banning gay marriage and defining marriage as between a man and a woman. There are a few lawsuits pending currently that are challenging the constitutionality of the ban on gay marriage in the state of Pennsylvania, all of which are at different levels in their proceedings.
Homosexual couples usually create estate plans so that their partner has close to the same rights and decision making power as a legally married partner. However, the one thing they are unable to do in PA is plan to have their partner avoid inheritance tax upon their death. If you are an unrelated person receiving any amount under someone’s will, you will be taxed at 15%. When spouses inherit from each other, they pay no inheritance tax. Why then, should a couple who has lived as a married couple and shared finances as married couples be taxed at any rate, let alone the highest rate? It is clearly discriminatory.
Recently I became involved with an estate for a gay woman. Her and her partner lived as a married couple for 31 years, sharing expenses, financial gains and loses and their lives as any other married couple would. When preparing the inheritance tax return, I found that her partner, the sole beneficiary under the estate, would have to pay $21,000.00 in inheritance taxes on money which she helped to accrue and save during their marriage. I spoke with her about this and she made the decision to fight the inheritance tax. After filing the tax return, we received a bill from the PA Department of Revenue stating that $21,000.00 was owed. We appealed the finding and went in front of a Board of Appeals Hearing Officer on Wednesday, October 30, 2013.
Prior to the hearing on Wednesday, my client did a few interviews with the Patriot News, The Sentinel and the Associated Press. We have both been thrilled with the media attention in this matter and my client has even appeared on some of the local news channels for interviews. We can only hope that, moving forward, the attention continues and the laws of this state grant equal rights for everyone. even been interviewed for the local news and is happy to get her story out. Click on the links above to read the articles that were published prior to the hearing and here to read the article published Wednesday after the hearing.