Businesses with 50 or fewer employees would be exempt from paying the inheritance tax under amendments to Section 2111 of the Tax Reform Code, signed into law by Governor Tom Corbett as part of House Bill 465.
To qualify for the exemption, a business must continue to be operated as a family business for at least seven years from the transfer following the owner’s death. Only those businesses with 50 or fewer employees and a net book value of assets of less than $5 million will be exempt from the tax, which is currently 4.5 percent for lineal heirs and 12 percent for siblings.
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