BIR Ruling [DA-170-05]

April 18, 2005 BIR RULING [DA-170-05] Secs. 90 & 91 Mr. Ali-Raschid L. Leong No. 4 Chase Street, Filinvest Homes 2 Phase D, Batasan Hills, Quezon City S i r : This refers to your letter dated August 23, 2004 requesting for another extension of time within which to file the estate tax return and pay for the estate tax due on the estate of the late Benjamin T. Leong, who died on November 27, 2003. The foregoing extension is sought since you need more time to collate all the documents pertaining to the properties comprising the estate of the decedent. The aforementioned properties are all located in Northern Mindanao. Likewise, you are also in the process of determining the validity of all claims against the estate, as well as, the liabilities secured by the abovementioned properties. In reply thereto, please be informed that under Section 90(B) and (C) of the Tax Code of 1997, estate tax return is required to be filed within six (6) months from the decedent's death, and in meritorious cases, a reasonable extension not exceeding thirty (30) days for filing the return may be granted by the Commissioner of Internal Revenue. The payment of the estate tax or any part thereof shall be made upon the filing of the return or on such date as fixed if an extension is granted by the Commissioner, but in no case to exceed five (5) years in case the estate is settled through the courts, or two (2) years in case the estate is settled extrajudicially pursuant to Section 91(B) of the Tax Code of 1997. cISDHE Based on the above justifiable ground, your request for an extension of time within which to pay the estate tax is hereby granted up to two (2) years reckoned from November 27, 2003 pursuant to Section 91(B) of the Tax Code of 1997. On the other hand, under section 90(C) of the Tax Code, only thirty (30) days is granted as an extensions of the period within which to file the estate tax return reckoned from the lapse of the six-month period within which the said return is required to be filed. Thus, considering that Benjamin T. Leong died on November 27, 2003, said period had already lapsed. Such being the case, you are hereby directed to immediately file a tentative estate tax return for the estate of Benjamin T. Leong in order to stop the running of the interest for late filing thereof. Moreover, in view of the above favorable action to your request for an extension of time within which to pay the estate tax, this Office has decided to forego the imposition of the surcharge and penalties on the estate tax due on the transmission of the estate of Benjamin T. Leong. However, it shall be understood that the estate shall be liable for the corresponding interest that have accrued thereon up to the time of payment of the aforesaid estate tax pursuant to Section 249 of the Tax Code of 1997. Very truly yours, Commissioner of Internal Revenue By: (SGD.) JOSE MARIO C. BUAG Deputy Commissioner Legal & Inspection Group