BIR Ruling No 105-99

Effect of Renunciation by or or A mong Heirs of Same Degree BIR Rul. No. 105-99  – July 13, 1999  Antigono Rosil died without a will, will, survived by his 3 children and his wife. He left behind behind an estate consisting of bank accounts with a total amount of 150K. A month after his death, his heirs (i.e. wife and kids) executed an Extra-Judicial Settlement of Estate with Waiver of Rights, whereby the 3 kids waived their rights to the bank acc ounts in favor of their mother. They sought the ruling of the BIR on the tax liability of the estate. The BIR held that the renunciation by the heirs of the inheritance does not constitute a donation in favor of the mother because the property/share never became their own.

DISPOSITIVE PORTION OTHER NOTES

DIGESTER: Xave Libardo

DOCTRINE In legal succession, accretion takes place in case of repudiation among heirs of the same degree. In other words, when heirs renounce their share in the inheritance in favor of another, they do not donate the property/share to the latter , latter , since the said property/share has never become their own. own .

FACTS 1. Antigono Rosil died without a will. He He was survived by his wife wife and 3 legitimate legitimate children. a. His estate consists consists mainly of bank accounts accounts with Land Land Bank, with with a total total amount of P153,478.01. 2. A month after his death, death, an Extra-Judicial Settlement of Estate with Waiver of Rights was executed by his heirs (wife and kids). a. The parties agreed that the 3 legitimate children will waive their rights to the bank accounts in accordance with the rule on intestate succession, in favor of their mother. 3. One of the children children wrote to the BIR, requesting on behalf of the other other heirs for a ruling as to whether or not his father’s estate is exempt from the payment of estate tax. ISSUE with HOLDING 1. Whether or not the estate is exempt from estate tax. YES. tax. YES. a. Considering that the gross estate of of Antigono consists merely of bank accounts in the total amount of P153,478.01, which is even lower than the P200,000.00 tax exempt portion of the net estate bracket as imposed under Section 84 of the Code, Code, the estate of the late Antigono A. Rosil is indeed exempt from estate tax. b. However, the executor, executor, administrator or any of the the legal heirs heirs of Antigono shall be required to file the corresponding estate tax return within return within six (6) months from months from the decedent's death with the Revenue District Officer (RDO) of the revenue district where the decedent was previously registered. 2.

Whether or not the waiver by the the 3 children of their shares in favor favor of their mother mother is subject to donor’s tax. NO. a. In legal succession, succession, accretion takes takes place in case of repudiation repudiation among heirs of the same degree. b. In other words, when the three (3) legitimate legitimate children renounced their their share in the inheritance, they did not donate the property/share to their mother , since the said property/share has never become their own  [BIR Ruling No. DA251-99 dated April 23, 1999].

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