BIR Ruling [DA-467-04]

September 1, 2004 BIR RULING [DA-467-04] 90 (C) & 91 (B) DA-260-2000 Bernas Law Offices 8/F Raha Sulayman Building 108 Benavidez Street, Legaspi Village Makati City Attention: Atty. Jose A. Bernas Gentlemen : This refers to your letters dated February 11, 2003 and March 25, 2004 requesting for an extension of time within which to file the estate tax return and pay for the estate tax due on the Estate of the late Alfonso Juan O. Olondriz, Sr., who died on June 9, 2003. The Estate is being litigated, thus, the Estate Tax Return is tentative and covers assets which may or may not be included on the final inventory and partition thereof. 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. Based on the foregoing and since the estate of herein decedent is being litigated, your request for an extension of time within which to pay the estate tax is hereby granted up to the maximum period of five (5) years reckoned from June 9, 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 extension 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 Alfonso Juan O. Olondriz, Sr. died on June 9, 2003, said period had already lapsed. Such being the case, you are hereby directed to immediately file the estate tax return for the estate of Alfonso Juan O. Olondriz, Sr. in order to stop the running of the interest for late filing thereof. IcCATD 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 Alfonso Juan O. Olondriz, Sr.. 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. (BIR Ruling No. DA 260-2000 dated June 9, 2000) Further, the special administrator of the estate of Alfonso Juan O. Olondriz, Sr. is hereby required to furnish a bond in such amount not exceeding double the amount of the tax and/or a surety conditioned upon the payment of the estate tax in accordance with the terms of this extension. Very truly yours, Commissioner of Internal Revenue By: (SGD.) MILAGROS V. REGALADO Assistant Commissioner Legal Service