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Section 240. Reports of county treasurers and comptrollers* of the city of New York.

241. Application of taxes.

242. Definitions.

[This article is a re-enactment of the Taxable Transfers Act of 1892 (Laws 1892, chap. 399), without change, except as indicated in the notes at the end of the sections. The references to the sections are changed throughout the article in accordance with the section numbers in this chapter. Section 234 is a re-enactment of Laws 1893, chap. 199, without change. Taxes heretofore accrued are saved by the Statutory Construction Law § 31, ante. See notes to that section.]

Section 220. Taxable transfers.-A tax shall be and is hereby imposed upon the transfer of any property, real or personal, of the value of five hundred dollars or over, or of any interest therein or income therefrom, in trust or otherwise, to persons or corporations not exempt by law from taxation on real or personal property, in the following cases:

1. When the transfer is by will or by the intestate laws of this state from any person dying seized or possessed of the property while a resident of the state.

2. When the transfer is by will or intestate law, of property within the state, and the decedent was a nonresident of the state at the time of his death.

3. When the transfer is of property made by a resident or by a nonresident, when such nonresident's property is within this state, by deed, grant, bargain, sale or gift made in contemplation of the death of the grantor, vendor or donor, or intended take effect, in possession or enjoyment, at or after such death. Such tax shall also be imposed when any such person or corporation becomes beneficially entitled, in possession or expectancy, to any property or the income thereof by any such transfer, whether made before or after the passage of this act. Such tax shall' be at the rate of five per centum upon the clear market value of such property, except as otherwise prescribed in the next section.

Right to Assess.

The right to assess a collateral inheritance does not exist unless some beneficial interest will pass to persons in whose hands it will be taxable. There must be a certain interest which vests in a specific beneficiary when

* So in the original.

the will takes effect.

Matter of Curtis, 38 N. Y. St. Repr. 348; affirming 56 id. 113; 142 N. Y. 219 (1894).

Amount of the estate and not size of individual shares, determines liability of an estate to taxation under Laws 1892, chap. 399. Estate of Taylor, 6 Misc. 277; S. C., 27 N. Y. Supp. 232; Matter of Hoffman, 62 N. Y. St. Repr. 245; 143 N. Y. 347 (1893); Matter of Hall, 68 N. Y. St. Repr. 538 (1895).

The test of the right to collect an inheritance tax is to ascertain the sovereignty by whose favor the property is permitted to pass. Matter of Swift, 47 N. Y. St. Repr. 47; affirming 2 Connoly, 644 (1892).

The right to the collateral inheritance tax accrues at the date of death of testator or intestate, and not at that of its actual imposition, and is not affected by intervening legislation. Matter of Prime, 64 Hun, 50; S. C., 45 N. Y. St. Repr. 832; 18 N. Y. Supp. 603 (1892).

Increase of property between decedent's death and the accounting of executors is not subject to collateral inheritance tax. The provisions of the statute for charging interest upon the tax are intended in lieu thereof. Matter of Vassar, 127 N. Y. 1; S. C., 37 N. Y. St. Repr. 239; reversing 58 Hun, 378; S. C., 34 N. Y. St. Repr. 328; 12 N. Y. Supp. 203 (1891).

The collateral inheritance tax imposed by Laws 1885, chap. 483, is upon every interest, immediate or future, derived under a testator or intestate, not embraced in the clause of exemption. Matter of Stewart, 131 N. Y. 274; S. C., 43 N. Y. St. Repr. 171; reversing 61 Hun, 544; S. C., 41 N. Y. St. Repr. 144; 16 N. Y. Supp. 388; reversed, 2 Connoly, 281 (1892).

Subdivision 3 of section 220 relates only to the conveyance and is intended to apply where conveyance may have been made prior to the act, while the beneficial interest, whether in possession or expectancy, should attach after the passage of the act. Talmadge v. Seaman, 61 N. Y. St. Repr. 73 (1894).

In assessing transfer tax, no deduction should be allowed for mortgages paid by the executor out of the personal estate. Matter of Livingston, 1 App. Div. 568 (1896).

The "transfer" of the property within the meaning of the act was effected by the death of the testator; that the tax became due and payable at once, and that the payment of the mortgages out of the personalty had no effect in reducing the amount of the taxable personal estate. Id.

Mortgage debts of the testator are not to be deducted from the personal property for the purpose of arriving at the value of the estate. Matter of Sutton (Surrogate's Ct., Westchester county), 15 Misc. 659 (1895); affirmed, 3 App. Div. 208 (1896).

Property Subject to the Tax.

Personal property of resident, wherever situated. Matter of Swift, 137 N. Y. 77 (1893).

Property transferred by will before act of 1892, the beneficial interest vesting subsequently. Talmadge v. Seaman, 85 Hun, 242 (1895).

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A vested remainder after a life estate, the value of the remainder being ascertainable. Matter of Vinot, 26 N. Y. St. Repr. 610 (1889).

Proceeds of an insurance policy payable to the insured or his personal representatives. Matter of Knoedler, 68 Hun, 150; S. C., 52 N. Y. St. Repr. 47; 22 N. Y. Supp. 608 (1893).

Personal property of nonresidents, habitually kept or invested in State. Matter of Romaine, 127 N. Y. 80; affirming 58 Hun, 109 (1891).

Bonds of foreign corporations and bonds of the United States belonging to a nonresident, and which are actually within this State at the time of his death. Matter of Whiting, 2 App. Div. 590 (1896).

Moneys of a nonresident decedent deposited in savings banks in this State; moneys in the hands of his attorney in this State and bonds secured by mortgage on lands in this State. Matter of Burr (Surrogate's Ct. of Westchester county), 16 Misc. 89 (1895).

Contingent and expectant estates, although they may be defeated, by an event not certain, are taxable immediately upon testator's death. Estate of Hoffman, 5 Misc. 439.

A bequest to the United States. Matter of Merriam, 141 N. Y. 479; 36 N. E. Repr. 505 (1894); Matter of Thomas, 3 Misc. 388 (1893); Matter of Collon, 5 id. 173 (1893).

United States bonds. Matter of Carver, 4 Misc. 592 (1893); Matter of Thomas, 5 id. 388 (1893); Matter of Whiting, 2 App. Div. 590.

Foreign religious corporations. Matter of Balleis, 60 N. Y. St. Repr. 792 (1894); Matter of Taylor, 62 id. 570.

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Stocks of foreign corporations held by an executor. Matter of Collon, 5 Misc. 173 (1893).

A legacy to a college in another State. Matter of McCoskey, 22 Abb. N. C. 20; S. C., 6 Dem. 438 (1888).

A bequest to be expended for masses for the repose of the soul of the testatrix. In re Black's Estate, 5 N. Y. Supp. 452 (1889).

A pecuniary legacy to be paid out of funds arising from the sale of government bonds. Matter of Howard, 5 Dem. 483 (1887).

A gift causa mortis, delivered to another person than the beneficiary. Matter of Crosby, 46 N. Y. St. Repr. 442 (1891).

Property passing by virtue of a gift causa mortis was subject to taxation under Laws 1887, chap. 713. Matter of Edwards, 66 N. Y. St. Repr. 231; 85 Hun, 436 (1887).

See decisions under exemption clause.

Future contingent interests, in real or personal property created by will, are not excluded from operation of the statute, on ground that they are incapable of valuation at time of testator's death, but upon the happening of the event upon which they are limited. When they are converted into actual vested estates, they may be appraised and taxed under the provisions of section 13, now section 233 of this act. Matter of Johnson, 47 N. Y. St. Repr. 47 (1892). This rule applied to charge the estate of a beneficiary under a power of appointment in a will, with the payment of the collateral inheritance tax. Id.

Where the estate of a nonresident decedent consist of property in this State and in foreign countries, nondemonstrative legacies are taxable in the proportion which the assets in this jurisdiction bear to the foreign assets. Estate of James, 6 Misc. 206 (1893).

Unless some legal and forcible claims existed against the testator by reason of services rendered, a legacy stated to be given in consideration therefor is not exempt from taxation. Matter of Doty, 7 Misc. 193; 56 N. Y. St. Repr. 626; 27 N. Y. Supp. 653 (1893). To escape payment of the tax, legatee must establish his debt and let the legacy go into the residuary assets. Id.

Though testator resided and died in another State, his property invested and located within this State was held subject to collateral inheritance tax under Laws 1885, chap. 483. Matter of Enston, 46 Hun, 506 (1887).

For the purposes of the Collateral Inheritance Law, possession by an agent in another State of bonds and mortgages on real estate there was held to be possession of testator. Matter of Corning, 3 Misc. 160; S. C., 51 N. Y. St. Repr. 265; 23 N. Y. Supp. 285 (1893).

An estate or interest derived from the execution of a power of appointment does not vest and is not created until the time of appointment, although its source is found in the instrument conferring the power. Matter of Brooks, 65 N. Y. St. Repr. 252 (1894). Where such an estate or interest which the beneficiary has taken under the power, as well as the right of the possession thereof, came into existence after the enactment of Laws 1892, chap. 399, by transfer previously made, it is subject to the transfer tax. Id.

Property not Taxable under Certain Conditions.

A bequest of the income of a fund, the present value of which does not exceed $10,000, to testator's mother is exempt from transfer tax. Matter of Hoffman, 58 N. Y. St. Repr. 699; S. C., 62 id. 245; 143 N. Y. 347 (1894). Until such interest becomes vested in possession, no appraisement of a contingent interest should be made or any tax imposed thereon. Id.

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A devise of the remainder after a life estate, if the remainderman be then living, with limitation over in case of his not living at that time, is not taxable during the lifetime of the life tenant. Matter of Wescott, 67 N. Y. St. Repr. 414 (1895).

Where a contingent remainder works a vested, though defeasible, interest in the remainderman upon the death of the testator, notwithstanding possession does not pass until death of life tenant, it is not taxable under the act of 1892, where death of testator occurred prior to enactment of such statute. Matter of Seaman, 69 N. Y. St. Repr. 316 (1895). Right of State to such tax attaches when right of succession accrues, but may not be enforced in advance of that future possession and enjoyment, or indefeasible ownership, which identifies the person who ought to pay.

A contingent remainder, where its devise works a vested, though defeasible, interest in the remainderman, at testator's death, notwithstanding possession, does not pass until death of life tenant, is not taxable under the act of 1892, where death of testator occurred prior to enactment of the statute. Matter of Seaman, 69 N. Y. St. Repr. 316 (1895).

The Collateral Inheritance Tax Act does not apply to a remainder limited on the grantor's death, by deed, which was delivered, and took effect in grantor's lifetime, before the passage of the act. The act applies only to deaths after its enactment. In re Hendrick's Estate, 18 N. Y. St. Repr. 989; S. C., 3 N. Y. Supp. 281 (1888).

A cash legacy of $500, payable at the end of the year from date of letters, is not taxable. Matter of Underhill, 2 Connoly, 262 (1890); Contra, Matter of Bird, 32 N. Y. St. Repr. 899 (1890). A general pecuniary legacy of that amount, which, under the general rule, does not bear interest until one year after testator's death, is not subject to the collateral inheritance tax. Estate of Peck, 24 Abb. N. C. 365; S. C., 9 N. Y. Supp. 465 (1890). See, also, Thorn v. Garner, 113 N. Y. 198; Matter of Jones, 5 Dem. 30.


The clause in subdivision 3, section 1 of the act of 1892, is to be restricted to gifts or grants causa mortis, and does not extend to transfer by will or intestacy, so as to subject to taxation, rights of succession, which accrued prior to the enactment of the statute. Matter of Seaman, 69 N. Y. St. Repr. 316 (1895).

Where transfer of a beneficial interest under a will occurred prior to passage of Laws of 1892, chap. 399, or of the previous acts, such interest is not subject to the transfer tax. Matter of Forsyth, 65 N. Y. St. Repr. 254; 10 Misc. 477 (1894).

Prior to amendment of 1887, the act of 1885 gave no authority to impose tax upon property passing from a nonresident of the State to his collateral relatives. Matter of Enston, 113 N. Y. 174 (1889).

Property not Subject to the Tax.

Personal property of a resident of another State, passing by the intestate laws of that State, although deposited in this State at time of death of intestate. Matter of Tulane, 51 Hun, 213; S. C., 21 N. Y. St. Repr. 191; 4 N. Y. Supp. 36 (1889).

Money of a nonresident of this State, belonging to him individually, and deposited by him in an account which he kept as trustee with a loan and trust company doing business in the State of New York. Matter of Houdayer, 3 App. Div. 474 (April, 1896).

Real property situated in a foreign State. Matter of Swift, 137 N. Y. 77; S. C., 50 N. Y. St. Repr. 81 (1893). See In re Twigg, 15 N. Y. Supp. 548; Lorillard v. People, 6 Dem. 268 (1887).

Personal property located without the State, or proceeds of real prop

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