Professional Documents
Culture Documents
ORDINARY DEDUCTIONS:
1. Expenses, losses, indebtedness, and taxes (ELIT):
a. Funeral expenses
b. Judicial expenses for testamentary or intestate proceedings
c. Claims against the estate
d. Claims against insolvent persons included in the gross estate
e. Unpaid mortgages or indebtedness upon the property
f. Unpaid taxes
g. Losses incurred during the settlement of the estate
2. Property previously taxed (Vanishing deduction)
3. Transfers for public use
4. Net share of the surviving spouse in the conjugal or community property.
SPECIAL DEDUCTIONS:
1. The Family home
2. Standard deduction
3. Medical expenses
4. Amount received by heirs under R.A. No. 4917 (Retirement Benefits of Employees of Private
Firms)
Decedent: NRA
1. Expenses, losses, indebtedness, and taxes (ELIT):
a. Funeral expenses
b. Judicial expenses for testamentary or intestate proceedings
c. Claims against the estate
d. Claims against insolvent persons included in the gross estate
e. Unpaid mortgages or indebtedness upon the property
f. Unpaid taxes
g. Losses incurred during the settlement of the estate
2. Property previously taxed (Vanishing deduction)
3. Transfers for public use
4. Net share of the surviving spouse in the conjugal or community property.
1. Expenditures incurred for the individual benefit of the heirs, devisees, legatees;
2. Compensation paid to a trustee of the decedent’s estate when it appeared that such trustee
was appointed for the purpose of managing the decedent’s real property for the benefit of the
testamentary heir;
3. Premiums paid on the bond filed by the administrator as an expense of administration since
the giving of a bond is in the nature of a qualification for the office and not necessary for the
settlement of the estate;
4. Attorney’s fees incident to litigation incurred by the heirs in asserting their respective rights.
1. The liability represents a personal obligation of the deceased existing at the Time of his death
except unpaid obligations incurred incident to his death such as unpaid funeral expenses and
unpaid medical expenses;
2. The liability was contracted in Good faith and for adequate and full consideration in money or
money’s worth;
4. The indebtedness must not have been Condoned by the creditor or the action to collect from
the decedent must not have prescribed (RR 2-2003; and
E. UNPAID MORTGAGES
G. LOSSES
V. STANDARD DEDUCTION
- A deduction in the amount of P1,000,000 shall be allowed as an additional deduction
without need of substantiation.