Legal Question in Wills and Trusts in Pennsylvania

Sorry to hear that your mother is so ill.

It can be done, but it will probably still be subject to inheritance tax. The inheritance tax return asks if any transfers were made within one of death without consideration, and such transfers will be included in the estate and subject to the tax.

THIS RESPONSE IS NOT LEGAL ADVICE, SINCE I DO NOT HAVE ALL OF THE INFORMATION THAT WOULD BE REQUIRED, AND I DO NOT HAVE A REPRESENTATION AGREEMENT WITH YOU.

* If the answers to your question confirm that you have a valid issue or worthwhile claim, your next step should almost always be to establish a dialog with a lawyer who can provide specific advice to you. Contact a lawyer in your county or township.

* Another reason for contacting a lawyer is that it is often impossible to give a good answer in the Internet Q&A format without having more information. The unique circumstances of your situation and things that you may not have thought to mention in your question may completely change the answer. If you want to be sure that you have a complete answer to your question and an understanding of what that answer means, establish a connection with a lawyer who practices in the area of your concern.

Why would the daughter do this at all? When mother dies, if this is a truly joint checking account, all of the funds would automatically go to the daughter. If she then wants to make a gift to her siblings, she can.

Transfers made by someone within one year of death are taxable. See 71 P.S.� 9107

(a) The transfers enumerated in this section are subject to the tax imposed by section 2106.1

(b) All transfers of property by will, by the intestate laws of this Commonwealth or, in the case of a transfer from a nonresident, by the laws of succession of another jurisdiction are subject to tax. The transfer of property of a person determined by decree of a court of competent jurisdiction to be a presumed decedent is subject to tax within the meaning of this section and section 2108.

(c) (1) All transfers of property specified in subclauses (3) through (7) which are made by a resident or a nonresident during his lifetime are subject to tax to the extent that they are made without valuable and adequate consideration in money or money's worth at the time of transfer.

(2) When the decedent retained or reserved an interest or power with respect to only a part of the property transferred, in consequence of which a tax is imposed under subclauses (4) through (7), the amount of the taxable transfer is only the value of that portion of the property transferred which is subject to the retained or reserved interest or power.

(3) A transfer conforming to subclause (1) and made within one year of the death of the transferor is subject to tax only to the extent that the value at the time of the transfer or transfers in the aggregate to or for the benefit of the transferee exceeds three thousand dollars ($3,000) during any calendar year.

(4) A transfer conforming to subclause (1) which takes effect in possession or enjoyment at or after the death of the transferor and under which the transferor has retained a reversionary interest in the property, the value of which interest immediately before the death of the transferor exceeds five per cent of the value of the property transferred, is subject to tax. The term �reversionary interest� includes a possibility that property transferred may return to the transferor or his estate or may be subject to a power of disposition by him, but the term does not include a possibility that the income alone from the property may return to him or become subject to a power of disposition by him.

(5) A transfer conforming to subclause (1), and under which the transferor expressly or impliedly reserves for his life or any period which does not in fact end before his death, the possession or enjoyment of, or the right to the income from, the property transferred, or the right, either alone or in conjunction with any person not having an adverse interest, to designate the persons who shall possess or enjoy the property transferred or the income from the property, is subject to tax.

(6) A transfer conforming to subclause (1), and under which the transferee promises to make payments to, or for the benefit of, the transferor or to care for the transferor during the remainder of the transferor's life, is subject to tax.

(7) A transfer conforming to subclause (1), and under which the transferor has at his death, either in himself alone or in conjunction with any person not having an adverse interest, a power to alter, amend or revoke the interest of the beneficiary, is subject to tax. Similarly, the relinquishment of such a power within one year of the death of the transferor is a transfer subject to tax except as otherwise provided in subclause (3).

(d) All succeeding interests which follow the interest of a surviving spouse in a trust or similar arrangement, to the extent specified in section 2113,2 are transfers subject to tax as if the surviving spouse were the transferor.

So if the money is paid now by your mother then it looks like it will be taxable if her death is imminent.

I really suggest before you do something costly is that you go and consult a probate/elder law attorney NOW. You want the attorney to help minimize taxes and that is a laudable and understandable goal. Howevber, you do not want to do something and think you can avoid inheritance taxes and end up causing a bigger legal problem.