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ESTATE TAXATION
Atty. C. Llamado

GROSS ESTATE
- Depends upon the citizenship and/or residence of the decedent:

Tangible Personal Intangible Personal

XDecedent Real Property
Property Property
Within Without Within Without Within Without
1) Citizen
2) Resident Alien
3) Non-resident
Alien

(if there is
reciprocity)

Intangible personal property means incorporeal property which do not have any physical form,
but represent right and privileges. Example includes bank deposits, Trademarks, share of stock,
patents, copyright, bonds, notes, interest in a partnership, etc.
Intangible Asset Situs
1) Receivable (promissory note) Residence of the debtor
2) Bank deposit Location of the bank
3) Other intangible properties:
a) Franchises, patents, copyright, trademark Where property is used or exercised
b) Investment in partnership Where partnership is establish
c) Share of stock (including corporate bond)
(1) Domestic corporation Within the Philippines
(2) Foreign corporation Without the Philippines
Except:
i) if > 85% of the business is in the Philippines Within the Philippines
ii) if shares have acquired a business situs in the
Philippines Within the Philippines

PROPERTIES INCLUDED IN THE GROSS ESTATE F A DECEDENT

- Includes all properties, right, and interests which the decedent owns at the time of his
death;

1) Property owned by the decedent and physically present in his estate at the time of death;

2) Interest (whether legal of beneficial) in property owned or possessed by the decedent at the time
of death (Ex. Usufructuary rights);

3) Taxable Transfer made during lifetime, but are in the nature of testamentary dispositions (mortis
causa in substance). The decedent remains in control of the property, and the transfer is transfer
is intended to take effect at or after his death.

a) Transfer in Contemplation of Death

- Transfer is implled by the thought of death