BIR Ruling [DA-609-99]

October 22, 1999 BIR RULING [DA-609-99] R.R. Tan & Associates 2/F, Vicente Madrigal Building 6793 Ayala Avenue Makati City Attention: Ms . Sally S . Velasco Gentlemen : This refers to your letter dated October 9, 1999 stating that the late Antonio N. Fernando, Jr., left a bank deposit with Allied Bank and Trust Company, Tagaytay City Branch and other real properties; that the Estate of the late Antonio N. Fernando, Jr. will be filing the corresponding estate tax return within a few days and the estimated estate tax due is P146,444.06; that the total deposit as of the time of death of the decedent is P614,073.90; that the withdrawal will be in favor of the widow, Mrs. Emilina M. Fernando, who will personally go to the bank to receive a manager's check payable to the Commissioner of Internal Revenue for the tax due, or that you will request the bank to remit directly to us and deduct the amount paid from the deposit of the deceased; that the heirs are not in a position to pay said amount plus additional assessment, if any, upon the filing of the said estate tax return. In connection herewith, you are now requesting on behalf of the Estate of Antonio N. Fernando, Jr., for an authority for Mrs. Emilina M. Fernando, widow of the late Antonio N. Fernando, Jr. to withdraw the amount of P146,444.06 representing the estate tax due and other assessment, if any, on the transmission of the said estate to the heirs. prcd In reply, please be informed that Section 97 of the Tax Code of 1997 provides "Sec. 97. . . . "If a bank has knowledge of the death of a person, who maintained a bank deposit account alone, or jointly with another, it shall not allow any withdrawal from the said deposit account, unless the Commissioner has certified that the taxes imposed thereon by this title have been paid; Provided, however, That the administrator of the estate or any one (1) of the heirs of the decedent may, upon authorization by the Commissioner, withdraw an amount not exceeding Twenty thousand pesos (P20,000) without the said certification." The above-cited section provides that unless the Commissioner has certified that the estate tax has been paid, only the amount of P20.00 may be authorized by the Commissioner to be withdrawn from the bank account of the decedent. However, equity and justice dictate that the above-cited provision must be construed to benefit both parties, extending the right to the heirs to pay the estate tax under exceptional circumstances. Such being the case, even in the absence of certification that the subject estate taxes have already been paid, authority is hereby given to Mrs. Emilina M. Fernando to request the bank to directly remit to the Bureau of Internal Revenue, c/o the Revenue District Office and to deduct the said amount from the deposit of the deceased from the Allied Bank and Trust Company, Tagaytay City. cdlex This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. Very truly yours, (SGD.) BEETHOVEN L. RUALO Commissioner of Internal Revenue