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COPYRIGHT, 1917

By MATTHEW BENDER & COMPANY

INCORPORATED

13

JELLYON ALBANY

COMPANY NEW YORK

INTRODUCTION

Every estate of fifty thousand dollars or more in value is taxed by the Federal statute. Nearly every such estate has investments in corporate stock. The transfer of such stock, at the death of its owner, is usually taxed by the state of incorporation as well as by the state of the owner's domicile. Most estates of any size are therefore subject to inheritance taxation in several jurisdictions.

In 1917 seventeen states and the Federal government amended their inheritance tax laws or adopted new statutes. In the last four years thirty-six states have done so out of the forty-four imposing such taxes. Transfer tax law, therefore, is nation-wide; and no text book that is merely an annotation of a single state statute, however elaborate, can give the necessary information.

Hitherto, with a few exceptions, most of the states have enforced inheritance taxation " Dogberry fashion;" but under the recent amendments the collection is now entrusted to special departments with ample legal assistance. The rates have also been heavily increased.

The plan of this book is to depart from mere statutory annotation and treat the subject of inheritance taxation as a distinct branch of jurisprudence, coordinating the decisions and statutes into a body of law gradually developed by the legislation and litigation of the last twenty years.

New York necessarily leads the way, as half the revenue and more than half the litigation has been derived from her statute; and it has been largely copied by other

states; but, as her citizens also pay a large share of the inheritance taxes collected in those states from the estates of nonresidents, New York attorneys cannot well confine their attention exclusively to the New York statute and the decisions under it.

As the state and Federal governments are all seeking to derive large revenues from the estates of decedents, involving in most cases double and triple taxation, attorneys are constantly besought by investors for advice as to the best means of minimizing such taxation. This book undertakes to point no way of evading the law. Its authors have been and are charged with the duty of enforcing it and could not properly advise methods of " tax dodging;' but a thorough understanding of the principles of inheritance taxation and the provisions of the several state statutes must afford legitimate information that will assist the lawyer and the layman justly and properly to adjust estate investments to meet conditions arising from laws, now in force.

To illustrate: No statute taxing inheritances, save possibly that of Rhode Island, taxes life insurance, when payable direct to the beneficiary, and not to the estate of the insured. No subsequent statute can constitutionally tax such insurance when once taken.

Matter of Pell, 171 N. Y. 48; 63 N. E. 789.

Matter of McKelway, 121 N. Y. 15; 116 N. E. 348.

In the last few months the courts have construed questions arising under gifts, joint tenancies, survivorship and partnership agreements, residence, domicile, and exemptions, clarifying many points in the administration of the law hitherto obscure. These will all be found in this volume.

Because, by mercy of "vox populi" and " pro bono publico," most of the state legislatures meet bienially, in the odd numbered years, the statutes, as now constituted, will remain unamended until 1919. For two years, at least, the information as to these laws afforded by this book will be up to date.

The plan of the book is to discuss inheritance tax law under six topics, as follows:

First: The nature of the tax and the constitutional principles that limit and control its imposition.

Second: The different transfers taxable; viz., by will, interstate law, gift in contemplation of death, etc.

Third: The parties and their interests, residence of the decedent, relationship of beneficiaries, exemptions, life estates, remainders, mortuary tables and calculations of the value of life interests.

Fourth: The property transferred, and the problems arising out of its situs and valuation.

Fifth: Procedure, necessarily confined to the New York practice, though it is largely followed in other states and authorities from those states are cited where applicable.

Sixth: General resumê of the statutes and an extended discussion of the provisions of the Federal and New York acts.

The Appendix gives the New York Decedent Estate Law, New York Forms and the inheritance tax statutes of all the states with tables showing the rates of tax and exemptions in each state.

The book also contains the tables of mortality used as the basis of inheritance tax calculations in all the states, lists of the principal stock corporations showing the state of incorporation and whether there taxable, names and addresses of the officers of the several states and the Federal internal revenue to whom attorneys should write

for blank forms and information; and the usual table of cases giving extensive citations from every jurisdiction imposing inheritance taxes.

It is hoped that these features are sufficiently novel and necessary to justify the publication and make it acceptable to the bar.

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