In re ESTATE OF William A. BANKS, Deceased. Appeal of Lita Indzel COHEN and Leon Goldberg, surviving executors and testamentary trustees of the Estate of William A. Banks, 127 Pa. Commw. 394

Summary

Approximately 79 percent of the decedent's estate consisted of common stocks, causing insufficient cash or liquid assets to meet the estate's tax obligations. Appellants executors elected to defer a portion of the federal estate tax pursuant to 26 U.S.C.S. § 6166. Despite appellants' diligent efforts, it became necessary to borrow funds to meet the estate's tax obligations. Appellants, in preparing the estate's tax return, deducted as administrative expenses, the interest paid on the loan, along with the interest on the deferred federal tax and the interest accruing on the unpaid balance of the Pennsylvania inheritance tax. The court affirmed the order of the lower en banc court, in favor of appellee, Board of Appeals, that sustained exceptions to a decree sustaining appellants' appeal, because interest expenses were of a different character from the list of deductible estate expenses under 72 P.S. § 2485-611. Moreover, 72 P.S. § 2485-622 disallowed deductions for federal estate taxes,...