Testate or Intestate: Meaning

• Someone who dies with a written will is said to die "testate." A person who dies without a written will is said to die "intestate."
  
  

Testate or Intestate: Significance

• Courts generally honor the wishes of a person who makes a written will distributing her property. Pennsylvania's special rules on dividing up property when someone dies without a will are called "intestate succession" and dictate fixed percentage distributions of property in varying amounts to lineal and collateral descendants.
  
  

Rates of Inheritance Tax on Transfers

• Inheritance tax rates vary based on the closeness of the relationship between the decedent and the beneficiary, including:
  * to a surviving spouse - 0%;
  * to lineal heirs (children/grandchildren and their spouses,etc.) 4.5%;
  * to siblings (brother/sister) - 12%; and
  * to collateral heirs (nephew/niece, aunt/uncle, friends, etc.) - 15%.
  
  

Transfers Not Subject to Tax

• Certain transfers of property that occur following someone's death are not subject to Pennsylvania inheritance taxes. One example is proceeds of life insurance on the life of the decedent.
  
  

Valuation of Estate Property

• In Pennsylvania, property is usually valued for inheritance tax purposes as of the date of the transferor's death, though for some types of property, alternate valuation dates are permissible.