APPENDIX.

The following is a synopsis of some opinions and rulings upon questions relating to the inheritance tax that have been submitted to the tax commission from time to time. By way of explanation it should be stated that it is generally the policy of the commission in doubtful cases to lean in favor of the imposition of the tax, leaving it to the courts to correct any excess of zeal that may be subsequently found in that direction. Katzer v. Milwaukee, 104 Wis. 16. Decisions of the courts have generally been followed where found in point. While the few decisions of our own supreme ourt are very helpful so far as they apply, nevertheless many questions arise that have not been finally passed upon. In presenting the following notes we are not prepared to insist that they will be adopted as the law in every instance upon appeal to the court of last resort; but rather that they are the best judgment of the commission as to what the law now is.

Bequest to executor. Section 1087-10 provides that a bequest to an executor in lieu of commissions is taxable upon the excess above the commissions and allowance prescribed by law. An executor in such case is also entitled to his exemption under section 1087-4.

Accrued interest taxable. Where interest for a part of a year has accrued on a note or other security at the death of deceased, but will not be due until the expiration of the year, the accrued interest should be added to the face value of the note in determining its value at the date of death.

Deductions. Executors' commissions, attorney's fees, or other expense incurred in collecting rents, interest, dividends, or other income accruing after death of decedent are not proper deductions in determining the net estate subject to tax. The income after death is not taxable; hence expenses connected with the collection of such income should be payable out of the income itself. State v. Probate Court, 101 Minn. 485.

Deductions. A reasonable allowance for monument, fencing or curbing of a burial lot of deceased and his family may be allowed and deducted as a part of the burial expense. It should be a reasonable allowance in view of the amount of decedent's estate. Three hundred or four hundred dollars is not an unreasonable allowance for a monument out of an estate of $50,000. Only such amount should be allowed as is actually expended for the purpose. Estate of Maverick, 135 App. Div. (N. Y.) 44; 119 N. Y. Supp. 194. Estate of Edgerton, 158 N. Y. 671; 35 App. Div. (N. Y.) 125. Estate of Liss, 78 N. Y. Supp. 969.

Deductions. Where deceased, a nonresident, left real and personal estate in both Illinois and Wisconsin, with mortgages standing against his real estate, and unsecured debts, the mortgages against the Wisconsin real estate should be deducted in full from the Wisconsin property; the mortgages standing against Illinois real estate should not be deducted nor any part thereof; and a proportion of the unsecured debts should be deducted equal to the proportion which the Wisconsin property bears to the entire estate.

Debts not deductable. Where deceased had purchased lands outside of Wisconsin upon land contract upon which payments are still due, the amount so due should not be deducted as a debt against the Wisconsin estate. Lands outside of Wisconsin owned by decedent are not subject to the inheritance tax in this state; and consequently the beneficiaries of the estate are entitled only to take the equity in such lands subject to any obligations connected therewith.

Stocks of foreign corporation. Stock in a foreign corporation owned by a resident of Wisconsin is not exempt from the inheritance tax on the ground that an inheritance tax is required to be paid in the state where the corporation exists. Matter of Gihon, 169 N. Y. 443. Blackstone v. Miller, 188 U. S. 187. Matter of Daly, 100 App. Div. (N. Y.) 373.

Fees of public administrator. Where there is a vacancy in the office of public administrator, or where the public administrator does not appear upon the hearing, or where the county

judge in his discretion has not requested the attendance of the public administrator, he is not entitled to fees; and the amount of fees which he might otherwise be entitled to belongs to the state, and not to the county.

Bequest for masses taxable. A bequest to a priest for masses is subject to the inheritance tax in the same manner as if the bequest were for his private use, since the only exemption from the tax for religious or charitable purposes provided by the statute is where the transfer is to a corporation of this state organized under its laws solely for religious or charitable purposes. Estate of Eppig, 118 N. Y. Supp. 683. Estate of McAvoy, 112 App. Div. (N. Y.) 377.

Allowances to widow taxable. An allowance to a widow pending the settlement of the estate, and the statutory allowances of $250 of household furniture and $200 of other property, are not proper deductions exempt from taxation. It is considered that the exemption to a widow of $10,000 is a generous exemption, and was intended by the legislature to cover the entire amount to which she is entitled free from the tax.

Dower and homestead interests. The present value of the dower and homestead interests passing to the wife upon the death of her husband is taxable to the wife as a part of the husband's property. People v. Estate of Marshall Field, 248 Ill. 147; Billings v. People, 189 Ill. 472. Sharp v. Loupe, 120 Cal. 89. Matter of Burdick, 112 Cal. 387.

Bequests of nonresident. A bequest of a nonresident to a resident of Wisconsin is not taxable, unless the property so bequeathed is Wisconsin property. A bequest or devise of Wisconsin property by a non-resident is taxable, whether the transfer be to a resident or nonresident. Blackstone v. Miller, 188 U. S. 206. McCurdy v. McCurdy, 197 Mass. 248. People v. Griffith, 245 Ill. 532.

Taxes as deductions. Taxes assessed against real estate do not become due under our statutes until delivery of the tax roll to the town, city or village treasurer, for the collection of taxes, in December. Such taxes in case of death prior to that

time are not proper deductions but are a burden against the real estate subject to which it is taken by the transferee; and they are not a debt or expense of administration. Taxes against. personal property, on the other hand, become a debt of the executor or administrator which must be paid to protect the personal property and are a proper deduction. Immediately upon the death the title of real estate vests in the heirs or devisees, while the legal title to personal property passes to the executor or administrator. Estate of Liss, 87 N. Y. Supp. 969. Ross on Inheritance Taxation, pp. 324-329. Estate of Maresi, 77 N. Y. Supp. 76. Estate of Freund, 128 N. Y. Supp. 48.

Conveyance in contemplation of death. Questions relating to conveyances made in contemplation of death or to take effect in possession and enjoyment at or after death are covered in some measure in this state in the cases of State v. Pabst, 139 Wis. 561; Estate of Bullen, 143 Wis. 612; In re Dessert's Estate 142 N. W. Rep., 647.

Inheritance vs. income tax. Where property is conveyed without consideration by one in advanced age, or ill, under circumstances indicating a conveyance in contemplation of death, the commission has held that such property is subject to the inheritance tax in preference to the income tax; and upon payment of the inheritance tax, or the institution of proceedings to determine the same, that such property is not subject to the income tax, as income received by the grantee.

Life estate with option to use principal. Where a will leaves property to a widow for life, empowering her to use the income and so much of the principal as she may desire in her discretion, the entire estate should be assessed to the widow. Campbell v. Beaumont, 91 N. Y.. 464. Larson v. Johnson, 78 Wis. 300.

When tax becomes fixed. The inheritance tax accrues at the death of decedent, and the rights of the beneficiaries and of the state become fixed as of that date. Subsequent settlements, compromises, or arrangements among the heirs or legatees by which the property is distributed in some different manner, or goes in whole or in part to others does not modify the right

of the state to the tax; and the computation should be made upon the basis of the distribution provided for in the will or under the intestate law. Estate of Seaman, 147 N. Y. 69. Estate of Davis, 149 N. Y. 539. Estate of Graves, 242 Ill. 212. Nat'l. S. D. Co. v. Stead, 250 Ill. 584. Pierce v. Stevens, 205 Mass. 219.

Lands out of state not taxable. The real estate outside of this state of a resident decedent is not subject to the inheritance tax. Conover v. Crosby, 210 Ill. 380. In re Swift, 137 N. Y. 77.

Debts due from legatees, etc. Notes or other indebtedness due to a decedent by his children or others and which he has discharged or forgiven by his will, are taxable, although at the time of his death said beneficiaries may have been insolvent. Matter of Twig, 2 Connolly (N. Y.) 633; 15 N. Y. Supp. 548. Matter of Smith, 4 Misc. Rep. (N. Y.) 169. Bartlett's Estate, 25 N. Y. Supp. 990.