The tax clause in the will executed by the decedent after his divorce from his first wife and before his marriage to his second wife directed that all death taxes be paid from the decedent’s revocable trust, and the clause was interpreted to require the payment of the entire amount of the inheritance tax out of the share of the estate passing to the revocable tax for the benefit of the decedent’s children by his first marriage, so that none of the tax was payable from the intestate share of the estate passing to the decedent’s second wife under 20 Pa.C.S. § 2507(3). In re: Estate of Jeffrey W. Tott, Deceased, 1144 WDA 2025 (Pa. Super. 9/16/2026) (non-precedential).
[DBE Commentary: There are two strange things about this opinion. The first is that the parties and the courts framed the issue as whether the second wife got the “benefit” of the tax clause, but the tax clause did not (and could not) provide any benefit to the second wife. If there were no tax clause, the Inheritance Tax Act would require each beneficiary to bear the burden of the inheritance tax on his or her share of the estate, but the intestate share of the surviving spouse would bear a tax of 0%, so the children’s trust would simply pay the inheritance tax on their own share of the estate. The real issue was whether the tax clause imposed a burden on the second wife of having to pay half of the inheritance tax on the share of the estate passing to the trust for the children.
Both the parties and the Superior Court felt the need to discuss and distinguish In re Corso’s Estate, 494 Pa. 269, 431 A.2d 253 (1981), but the decedent in that case had died in 1976, when there was an inheritance tax rate of 6% for surviving spouses. In both cases, the second marriage was after the execution of the will, so the surviving wife was entitled to an intestate share of the estate. But the issue in Corso was whether the tax clause should benefit the second wife by requiring the children of the decedent to pay the inheritance tax on the intestate share passing to the second wife, while the issue in Tott was whether the tax clause should burden the second wife by requiring her to pay half of the inheritance tax on the share passing to the children, and no one seems to have noticed that difference.
The second strange thing about the Tott case is that only the burden of the inheritance tax was disputed, and not the burden of any federal estate tax. (The estate inventory was reported to be more than $55 million, and a “federal inheritance tax return” was filed, so there should have been some federal estate tax payable unless there were more than $29 million in debts and expenses.) How was it possible for the parties to litigate the effect of the tax clause on the payment of inheritance tax without also disputing, or at least considering, the effect of the tax clause on the payment of federal estate tax?]
[DBE Supplemental Comment: It has been suggested that the parties and the courts referred to both the federal estate tax and the Pennsylvania inheritance tax as “inheritance taxes,” and so the dispute was about the payment of both kinds of taxes. That is certainly possible, and it explains the “second strange thing.” However, the first strange thing is still strange, because the intestate share of the second wife would not be subject to federal estate tax either.]