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Change in formula for inheritance tax proposed

A campaign by Theresa Santai Gaffney, who last January became the new Register of Wills and Clerk of Orphans' Court in Schuylkill County, to revamp the formula by which counties and the state share inheritance tax proceeds has received the support of state Sen. David Argall. The proposed change would allow the counties to retain a greater share of the taxes.

Currently the counties are tasked with collecting inheritance taxes and disbursing it under the following formula: $1 to $200,000 collected in any calendar year, 4.25 percent is retained by the county; $200,000 to $1 million, 1.75 percent; $1 million and above, 0.5 percent. All proceeds above the percentage retained by the county are submitted to the Pennsylvania Department of Revenue.Gaffney pointed out her office reached the $200,000 mark under which she retained for the county 4.25 percent was early in January and reached the $1 million peak by which it retained 1.75 percent at the end of January. From that period to the present it has been allowed only to retain 0.5 percent. Her goal is for the counties to retain a flat one percent for the entire year. In 2011 the county received $39,471.86 in commission while the state received $6,872,921.90.Argall, joined by Sens. Yudichak and Waugh, have drafted Senate Bill Number 1547 for the 2012 session amending the Transfer Inheritance Tax Law of 1986 to read as follows:The register of wills shall, immediately upon assuming office, file with the Department of Revenue the bond hereinafter required for the collection of the said tax in the case of resident decedents. The register of wills shall pay over to the general fund of the county for the use of the county one per centum of the gross amount collected during any year, as follows:Four and one-quarter per centum upon the tax collected, if such tax shall amount to a sum of $200,000 or less; one and three-quarters per centum on the amounts collected in excess of $200,000; and up to and including $1 million and one-half of one per centum on the amounts collected in excess of $1 million.The bill is currently in the hands of a committee for final tuning before being brought out on the floor for a vote.