Death and taxes

It was Ben Franklin (wrongly attributed to Mark Twain) who blurted out the quote or misquote: “In this world, nothing is certain except death and taxes.”
The quote has cemented a place in our history and popular culture and even in our world.It applies and basically means that death and taxes are loathed but unavoidable; no matter who we are or who we think we are. At these times of the pandemic, this has become a painful reality especially for people whose loved ones die suddenly due to the virus that causes the infection. Sadly, it claims lives and aggravates those left behind as it can wipe out the entire family’s savings and assets and sink them into debt.
Of late, our office and even Dhobie de Guzman’s RNG Luzon News have been receiving inquiries about settlement of estates of a deceased person or their bank accounts after death.
More particularly are the questions of how one withdraws from the bank account of a relative who just died.
Republic Act 10963, or “The Tax Reform for Acceleration and Inclusion (Train) Law” that amended the National Internal Revenue Code, now allows the withdrawal of bank deposits of a deceased person pending the settlement of the estate and the payment of the estate tax subject to the withholding tax of six percent xxx Sec. 97. Payment of Tax Antecedent to the Transfer of Shares, Bonds or Rights. xxx
Thus “If a bank has knowledge of the death of a person, who maintained a bank deposit account alone, or jointly with another, it shall allow any withdrawal from the said deposit account, subject to a final withholding tax of six percent. My simpleton understanding is if it is one account of the deceased, the six percent shall be imposed, while if joint with one, the six percent shall only apply to 50 percent of the account.
The bank also requires that withdrawal slips shall contain a statement to the effect that all of the joint depositors are still living at the time of withdrawal by any one of the joint depositors and such statement shall be under oath by the said depositors.
Implementing the amendment introduced by the Train Law, the Bureau of Internal Revenue issued Revenue Memorandum Circular (RMC) 62- 2018 on June 28, 2018, stating, “The executor, administrator, or any of the legal heirs of a decedent who, prior to death, maintained bank deposit/s may be allowed withdrawal from the said bank deposit account/s within one year from the date of death of the depositor, but subject to six percent final withholding tax (FWT).
RMC 62-2018 provides that prior to withdrawal, the bank, in lieu of an electronic certificate authorizing registration (eCAR), shall require the executor, administrator, or any of the legal heir/s withdrawing from the deposit account to present a copy of the tax identification number of the estate of the decedent and BIR form 1904 duly stamped received by the concerned Revenue District Office (RDO) to be presented to the bank.
Consequently, to certify the withholding of the tax, banks shall issue BIR Form 2306 (Certificate of Final Tax Withheld at Source) and file a quarterly return on the final tax withheld and remit the same on or before the last day of the month following the close of the quarter when the tax was withheld.
The withdrawal slips shall contain a statement that the withdrawal is subject to six percent FWT. Nonetheless, in case the bank deposit is already declared for estate tax purposes and indicated in the eCAR issued by the concerned RDO, it shall no longer be subject to the six percent FWT.
At any rate, RMC 62-2018 clarified that before allowing any withdrawal, banks may still require pertinent documents in accordance with its existing policy or in pursuance of a requirement under applicable laws, rules, and regulations to ascertain the identity and the right to claim of the heir/s or the authorized representatives of the heirs.
The bottom line though is taxes are there in life and in death.
Breaking from the legalities, a worried father calls the family doctor because he thinks his teen son has caught a venereal disease.
“I think he got it from the maid,” says the concerned dad, “and I’ve also been sleeping with the maid.” “Okay,” the doctor replies calmly.
“Well, when you bring him into the office, we’ll take a look at you as well.” “And that’s not all,” the father continues.
“I think I might have given it to his mother.” “Oh no!” cries the doctor. “Well, now we might all have it!”
Laughter is the best antidote to death and taxes.
Sigh.