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Funeral expenses Q: What the conditions for the deductibility of funeral expenses? 1. Whether paid or unpaid 2. Up to the time of interment 3. The actual amount or in an amount equal to 5% of the gross estate, whichever is lower, but in no case to exceed P200,000 Note: (1) Actual funeral expenses shall mean those which are actually incurred in connection with the interment or burial of the deceased. The expenses must be duly supported by receipts or invoices or other evidence to show that they were actually incurred. (2) The amount in excess of the P200,000 threshold shall not be allowed as a deduction nor will it be allowed to be claimed as a deduction under “claims against the estate. Q: A died leaving an estate valued at P20,000,000. His heirs spent P500,000 for all the funeral services. How much should be allowed as a deduction? The amount deductible is only P200,000. To determine amount deductible, compare P500,000 and P1,000,000 (5% of P20 million). The lower amount is P500,000. However, it is beyond the P200,000 threshold. Thus, only P200,000 will be allowed as a deduction. Q: Give some examples of funeral expenses that are deductible 1. The mourning apparel of the surviving

spouse and unmarried minor children of the deceased, bought and used on the occasion of the burial 2. Expenses for the deceased’s wake, including food and drinks 3. Publication charges for death notices; 4. Telecommunication expenses incurred in informing relatives of the deceased;