FOR IMMEDIATE RELEASE
November 20, 2004
Contact:  Erin K. Kelly
(717) 846-2828
ekelly@pasen.gov
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Waugh Legislation to Establish Debt Payment Order For Estates of Decedents Approved by Legislature

HARRISBURG – Senator Mike Waugh's (R-York) Senate Bill 304, which amends the Probate Code to further provide for classification and payment of debts when the assets of an estate are insufficient to cover them, received a concurrent vote Friday from the House on Senate amendments. It now goes to the Governor for his signature.

According to the National Conference of State Legislatures, 42 states put taxes on a list of priority debts to be paid, but Pennsylvania is one of a few states that does not assign a priority of any kind in claims against estates for taxes.

"A mayor of a borough in my senatorial district brought this issue to my attention, and it surprised me to find out that Pennsylvania was one of those few states that does not prioritize tax claims against estates," said Waugh.

Some states rank taxes as high as second; most prioritize them between third and sixth. Waugh's legislation would put debts owed to the state or political subdivisions sixth on the list of priorities.

"It is important for us to ensure that the claims against an estate by both the Commonwealth and the municipal governments are paid in full, and adding such claims to the priority list of payments will do just that," said Waugh.

The Senator's legislation would amend existing law to provide for a rule similar to the Uniform Probate Code, promulgated by the National Conference of Commissioners on Uniform State Laws.

Additional amendments were added to increase from $3500 to $5000 the following:

• The amount a bank, credit union, or other savings organization may pay to an heir, from an account of the deceased, to cover funeral expenses.
• The amount, should a deceased have been a recipient of medical assistance through the Department of Public Welfare and have remaining funds in their account, that can be used towards funeral costs.
• The maximum value of real or personal property a spouse, children, or parents of a decedent dying in the Commonwealth can claim as an exemption.