2013 (Taxation) Bar Exam Questions: Essay Question 9

[Discuss/answer the question below. Or see Taxation Instructions; Taxation Essay Questions: 12, 3, 4, 5, 6, 7, 810, 11 and 12; Taxation Multiple Choice Questions: 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19 and 20; See also 2013 Bar Exam: Information, Discussions, Tips, Questions and Results]

IX.

In the settlement of the estate of Mr. Barbera who died intestate, his wife renounced her inheritance and her share of the conjugal property in favor of their children. The BIR determined that there was a taxable gift and thus assessed Mrs. Barbera as a donor.

Was the BIR correct? (7%)

21 comments

  1. as per BIR friend:

    as to renunciation of inheritance, if it is in favor of co-heirs, it is generally not taxable .

    as to renunciation of conjugal share, it is subject to donor’s tax.

  2. hindi ko sagot yan dahil hindi ko na talaga matandaan yung sagot ko kaya tinanong ko yung friend ko na taga BIR sa FB chat kanina.

    dami nyang kwento sa akin, na during the 2008 bar exams, marami daw syang hindi nasagutan dahil sobrang haba ng exams at she was losing hope na papasa sya pero sa awa ni God, noong lumabas yung results, nakapasa sya!

    1. Ganyan din sabi ng ibang friends ko na pumasa. Pero yung iba naman na inaasahan naming pumasa, bagsak naman. We cant really tell. Hope for the best na lang.

  3. Ganyan din sabi ng ibang friends ko na pumasa. Pero yung iba naman na inaasahan naming pumasa, bagsak naman. We cant really tell. Hope for the best na lang.

  4. buti umattend ako ng preweek. Naalala ko sinabi ng lecturer pag renunciation in favor of co heirs, not taxable. pero kung one or some of the co-heirs lang taxable daw. diko maalala ung reason why it’s taxable pag one or some lang. lutang utak ko nong preweek. Kumbaga sa food, busog ka na kinikeri mo pa ring kainin mga sinasabi ng lecturer he he 😉

    1. Kasi po kapag isa or iilan lang sa co heirs you are exercising acts of ownership, hence instead of pure renunciation you are actually accepting the inheritance and when you renounce in favor of the particular heir/s ( but not all) they are actually inheriting or accepting from you unlike if renunciation is in favor of ALL co heirs , they are still inheriting from the decedent since by law it would properly accrue to them also.

      1. Thanks Anon 🙂 dito muna ako sa mga q&a super intense sa discussion ng bar result dahil kay gudjab he he

      2. Haha tama ka dyan, kahit ako di na pumapatol sa mga ganun, id rather indulged in academic discussion and pwede rin personal thoughts na may sense kasi outside this 2 areas talagang wala ng intellectual value kasi in the first place hindi naman tayo personal na magkakakilala kaya no point na patulan pa, kung enjoy sya sa kalokohan nya, let him be, mas na engganyo lang yan to post more dahil may nag rereact, subukan mo mag post ng mag post na walang pumapansin tingnan kung hindi ka magsawa, hehe

  5. BIR Ruling No.291-2006 dated May 3,2006
    renunciation of inheritance in favor of co-heirs NOT taxable; however, renunciation of conjugal share in favor of co-heir is taxable

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