Lost Titles and Inheritance Tax - Part 2

by : Genevieve F. Bonquin, REB, REA, REC
        PRC Real Estate Broker Lic No. 2309
        PRC Real Estate Appraiser Lic No. 5754
        PRC Real Estate Consultant Lic No. 92



       In May of 2012, I wrote the first part of this blog to document my first case ever handled in this category. Its now January 2015 and we are only in the process of transferring the title to the sole heir. The reconstitution of title took time and the petitioner (heir) had to fly here from abroad to take witness stand. You will need a lawyer on this to file the case in court that has the jurisdiction over the property. 


      Our courts are so slow moving and it took more than two years from filing up to the release of court order. Not including the preparation and collating requirements like death certificate, birth certificate which will all come from abroad. Affidavit and other requirements need to be authenticated in the Philippine Consulate. Then payment of estate tax where we have to find a buyer first so that we can have money to pay the estate tax. Release of CAR (Certificate of Registration) also took more than 3 months and only at BIR Main Office not in the district where the property is located!


      Some of the highlights in this case that maybe notable :


      1. On Estate Tax, if the title holder died abroad, no allowed deductions like medical expenses unlike if the title-holder died in the Philippines.

      2. If the Estate Tax was not filed within 6 months from death, there will be corresponding penalties as much as 25% plus surcharge. BIR determines this.

      3. Title need to be reconstituted first before any changes in the title can be done. To avoid penalties at BIR, you may pay estate tax while waiting for court order.

      4. If there are other properties or bank deposits and other assets like memorial plots, best to include in the process. If not, all these other assets will have to repeat same procedure and requirements.


      In this case, it is good that our buyer is also a lawyer and understood the process otherwise, the heir have to shell out money for estate tax or lower the selling price considerably. I have received inquiry if there is another way of doing this, but if you lost the owners duplicate copy, there is no other way to replace it but to go through the court. You cannot just get a copy from the Registry of Deeds because what they will give you is the certified true copy of the original. The certified true copy is not alienable. It is only a proof that the title exist and in the name of the owner.


     As for simple lost title, whose owner is alive and well, it is easier and faster. Because of my blog, I was able to process and help a few more with lost titles. Court case took only less than a year. It takes longer when the title of a deceased owner is lost and then it needs to be transferred to heirs. Testaments or wills do not help as according to my lawyer, it takes longer to probate a will. So best not to present if there is only one heir or the legal heirs have executed extra-judicial settlement. If there is conflict on sharing then the will can help but longer court case and it can drag in court.


    For my colleagues, who are practitioners like me, I hope this will help you encounter lost title. We may not earn good in the processing of documents but it is the experience of going through the process that we educate ourselves. That we can tell ourselves that we are truly a bonafide Real Estate Service Professional if we can help our clients with this kind of service. After all, if they want to sell the property, you can get the exclusive authority to sell and you are the expert when it comes to the property's documentation.

 This is the link to part 1 of this blog : http://www.greenhuts.net/blogs/gigi__bonquin/archive/2012/05/10/lost-title-and-inheritance-tax.aspx

    If this article has helped you or you need help with similar situation, please feel free to email me at gigi@greenhuts.net


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