September 22, 1961 

Honorable Robert S. Calvert 

Comptroller of Public Accounts 

Capitol Station 

Austin, Texas 

Dear Mr. Calvert: 

Opinion No. WW-1146 

Re: Exemption frm inheritance 

taxes of certain devlaes 

and bequests to charitable 

institutions. 

In connection with yr?ur request that this office furnish you with an 

opinion on the above captioned matter, you have supplied WI with the following facts. 

Morris Glozman died November 14, &yp. By the terms of paragraph 4 

of his last will and testament, which haa been duly admitted to probate, 

the decedent directed *.,. . that my estate be divided equally among 

The B'NAI B'RITR OLD FOIgS' HOME.at Memphis, Tennessee, THE SHRINE CRIPPIED CHIIDREN'S HOSPITAL FUVD OF Houston, Texas, and THE JEWISH CONSWPTIVE HOME of Denver, Colorado." ' 1 

Whether an exemption from inheritance tares may be accorded these 

testamentary charitable gifts muet be determined in view of the provisions 

of Article 14.06, Title lZ!A, Tax.-Gen., Ch. 14, V.A.T.S. The pertinent 

provisions of Article 14.06 are the following: 

"If passing to or for the uee of the United States, 

to or for the u8e of any other person or rel%gioue, educational or charitable organization or institution, or 

to any other person, corporation or association not included in any of the classes mentioned in the preceding 

portions of the originaYAct known as Chapter 29 of the 

General Laws of the Second Called Session of the 38th 

Legislature, the tax shall be: 

* 

. . . . 

“Provided, however, that this Article shall not 

apply on property passing to or for the use of the United 

States, or to or for the use Of any religious, educational or charitable organization, incorporated, unincorporated or in the form of a trust, when such bequest, 

devise or gift Se to be used within this state. The exemption from tax under the preceding provisions of this 

Article shall, without limiting ita application under 
Honorable Robert S. Calve&, page b (W-1146) 

other appr;nprf&tl irircw&,ances, apply to all or eo 

much a? any boquwt, devise or gift to or for the uee 

of ,the %fted Stats, or * religioue, educational or 

charitable orgwization, whPCh fs, in writing and 

prior to ,t??'r; payment of the tax, irrevocably committed 

for woe exclusively within the State of Texas or transferred to a religiow, e&cetional or charitable organfzation for use exclusive$ vrthin this state. 

“Provided, father, that if the property eo passing 

3.8 to or for the uee of a'reifgfous, educational,or charitable organization which conaucte ita operations on a 

regional baais, one such region of which ineludes the State 

of Texas, or army part thereof, then a bequest, devise or 

gift to be used within e&h region shall be deemed to be 

used within thiu state. ' 

'?or purpoaeu of this paragraph, a religious, educa.- 

tfonal, or charitable organization ehall include, but not 

be lfmited to, a youth prbgrem of physic&. fitness, character 

developent, and citizenship training or like program." 

We willfirat coneider whet&& the devise and bequest to the Shrine 

Crippled Chfldren'e Hospital Fund 'of Houston, Texas, is exempt from inheritance taxes. You have furniehed ue with the inheritance tax return file fn 

connection with the estate of this decedent. This return reveals that the 

correct name of the recipient of the bequest under consideration is The 

Arabia Temple Crippled ChiLdren'e Clfnic. This Clinic is a Texas corporation chartered for the purposes of' aupptirting "benevolent, charitable and 

educational undertaki~n~a for crippled children not over the age of fourteen (14) yeare, regsrdlsso of race, 5+ded or color . . .* 'The office of 

the corporation is mafntnlned in Houston, Texas. On January 11, 1961, at 

a meeting of the Board of Trueteed of the corporation, a resolution wae 

adopted chuthorizfr% the offfcers of the corporation to execute and deliver 

to the Honorable Robert S. Crlvert, Comptroller of Public Accounts of the 

State of Texao, on behalf a& in the name of the corporation, an agreement 

irrevocabu committi~ all the pr6perty pawing to the corporation ,under 

the decedent's wfll for use for charitable purpoees exclusfvely within this 

State. A copy of this resolutfol together with a letter from the Clinic, 

acting through the Chairman of the Board, was sent to Honorable Robert S. 

Calvert. In the Letter ,the Clinfd irrevocably committed al1 the property 

here involved for use for charitable purposes within this State. 

We thinkthst this devise and bequest is clearly exempt as one to a 

"charitable organization and a 'gift D D ~ to be ueed.within this State 

. . . ' ) and that the beqwet and devise has been 'irrevocably committed 

for use exclusively wfthin the State of Texas. D Oa*. Since every condition of the otatute haa been satisfied, we need not and do not pass upon 

e 
Honorable Robert S. Calvert, page ‘3 (~-1146) 

the queetion of whether a speeiffc commitment wae necessary, under the 

eubmitted facts, in connection with this particular devise and bequest. 

We will now consider whether the devise and bequest to the Jewish 

Consumptive Home of Denver, Colorado, is exempt frak inheritance taxes. 

The inheritance tax file reflects 'that the correct name of this beneficiary is The National Jewiah Hoepita at Denver. The Hoapital la a 

non-profit Colorado corporation having &s its corporate purpose the operation of a hospftal or hospitals. According to the by-laws of the corporation, its specific purpose is to treat, without charge, and without dietinction of creed, persona suffering from tuberculosis or diseases of the 

chest and to conduct education and'retiearch in this field. They also provide "The Services of this Hospital shall be free and non-eectarian", and 

'none may enter who can pay - none can pay who enter". 

On December 28, 1960, the Board of Trustees of The National Jewish 

Hospital at Denver adopted a resolution which containa tbsfollowing paragraphs : 

%HEREAS, the National Jewisli'Bbspital at Denver is 

engaged solely and exclusiveb in charitable activitiee~ and, 

"WHEfBW, the Bati&aiJewieh H ospital at Denver maintaina 

a regular office within the State of Texas for the purpose of 

conducting and carrying on ite charitable activities; and, 

"WHEREAS, the Hational Jewish Roapital at Denver expends, 

annually, between $25,COO.OO and $30,000.00 within the State 

of Texas, eolely for charitable pnrposee; 

"NOW, THEREFORE, IT Is HER%RY RESOLVED, that the National 

Jewish Hoepital at Denver irrevocably commit all~propertiee and 

assets, of whatsoever typkLor titure, passing to it under and by 

reason of the Last. Will and T'estement of Morris Glozman, deceaeed, 

for charitable purposes excltiively within the State of Texae and 

States contiguous to the Statb of Texas." 

A copy of the resolution-in ita entirety has been forwarded to the 

Honorable Robert S. Calvert, together with a letter from The Honorable 

Philllp Houtz, Secretary of The Natfonal Jewish Hospital at Denver. In 

this letter, Mr. Houtz stat& on-behalf of the Hospital that it irrevocably 

commits all the property received %er the will, in question, for uee for 

charitable purposes "exclusively tithfn the State of Texas and States contiguoue thereto." 

We have not been informed of the exact nature of-the charitable activitiee carried on, and to be carried on>'by use of the bequested funds, by the 

Hospital in this and contiguous States. For the purpose of this opinion, 
I 

we will as~mne that the charitable activities to be carried on in this State 

by the UBB of the fun& are in connection with the aotual operation of the 

Hospital for tte use end benefit of Texas residents. However, in vfew of 

the fact that the fun&a in question were not irrevocably oommftted to exclusive use in Texas, 'but aleo to use in "States contiguous thereto", we 

are of the opinion that an exemption for thie devise and bequest cannot 

be obtained, unleao and until the fund8 are irrevocably ccmmitted to the 

exclusive ude fn Texas. , 

We do not believe that the mere set of irrevocably committing a bequeet for charitable purposes to be used exclusively within t1e State of 

Texas and States oontie;llous to the State of Texas, would eonatf.tzte the 

conduoting of the Hospital's operationa on a regional basis. ,1he Hospital 

admits charity patients, without limftatlon a8 to residence. It is clear 

to us, that for a charitable organization to conduct its operations on a 

"regionalbasfen, ae that term ia ueed in the statute, that the entire field 

of its operations would have to be'divlded into separate and distinct regions 

and be of a permanent nature, wit&each region beiw subject to looalmenagement and control, under proper directfvea from the officers or directors of 

the charitable organization. 

If it could be said that irre+ocab'ly canmitting a bequeet to be excluaively used in Texas and one oi:more States contiguous to Texas would 

conetitute the hospital's operetioks to be on a regional basis, and ff we 

are correct, end we believe we are) In stating that for a charitable organization to operate on a regional bssie, that its entire field of operations 

would have to be divided into separate and distinct fields, the following 

anomaly could result. New Mexico, Oklahoma, Arkansas and Louisiana are the 

only states contiguous to Texas. We will aeeume that the Hospital is the 

recipient of thirteen additional charitable bequests. The directors of the 

hospital make B similar commitment 88 to each additional bequeat, (1) One 

to be used exclusively in T&as and New Mexico, (2) one to be used excluefvely 

in Texas and Oklahcrma, (3) one to be u&ied exclusively in Texas and Arkaneas, 

(4) one to be used exclusively fti "rexas &id Iaufsiana, (5) one to be ueed 

exclueively inTexas, New Mexico kma Oklahoma, (6) one to be used exclusively 

In Texas, New Mexico p and Arkan%&+, be wed exclusively fn Ta, 

New Mexico and Ioufeiana, (8) on&to be used exclusively in Texas, New Mexfeo, 

Oklahcsna MB Arkansas, (9) one'to:be used exclusively in Texas, New Mexico, 

Oklahoma and Loufeiane, (10) one to be used exclusively inTexas. Oklahoma, 

and Arkansae, (11) one to be used :exclLeively in Texas, Oklahana and Iouisfana, 

‘(12) one to be used exclusively in Texae, Oklahoma, Arkansas and Louisiana, 

and (IJ) one to be used exclusively in Texas. Arkansas and lauisfana. This 

would result In the five tit&es 04 TBxa8, New Mexico, Oklahoma, Arkansas and 

Loaiolana being divided into fou&e& 88 

tl 

arate regions with Texas being in 

all fourteen regions, and eaeh of ,the,o er four states being in seven of 

the regiona. This anomaly oould be further multiplied fndeffnitely by irrevoaably oammltting euc.h funds to'certain desimated portions of Texas, a8 

the statute provides, *one such region of which includes the State of Teqhs, 

or any part thereof. . .* 
Honorable Robert S. Calvert, page 5 (WW-1146) 

. We therefore bcla +&at an exemption frcm the inheritance tax for the 

devise to The National Jewish Hospftal at Denver cannot be obtained mleas 

and until the funds in queetion are irrevocably committed to the exclu.us%ve 

use in Texas. ,' 

The third beneficiary of ,the teatator's largess is the B'NAI B*RITH 

OIII FOIKS' H@lE, at &mpbfa, Tenn6aeee. The inheritance tax return reflects that the correct name of this institution is the B'NAI B'RITH HOME 

ANDHOSPlTALFORTHEAGEQ, INC. ~The B'NAI B'RITH HOME AND HOSPITAL was 

incorporated under the 18~8 of the State of Tennessee for the purpose of 

"' the support of a~ 'benevolent or charitable undertaking a8 a Lodge of 

Masons, Odd FeLlowa, hoapitala for the sick, houses of refuge or correction, 

orphan asylm, and aI1 other objectsof alike nature' end epeciffcally for 

the ownership and operation of a h,?me and hospital for the aged.* The bglaws of the Borne et&e that its ptipoee ie to operate a home and hospital 

in Memphie, Tennessee, and to provide for the physical and spiritual needs 

of aged and infirm Jew6 who reside within the geographical limits of 

District Grand Iodge #7. The geographical limits of B'NAI B'RITH District 

Grand Lodge #7 embrace the following states: Alabama, Arkansas, Louisiana, 

M%ss%as%pp%, Oklahoma, Texas and Tennessee. The Secretary of the Executive 

Committee of the Board of Directors of the corporation has furnished a 

certificate which contains the information that many Texasl residents have 

resided in the Borne and recefved hospital care during its existence. He 

states that at times there have been aa many aa 20 persona from Texas and 

that there me presently in residence at the Home and Hcapital I2 Texans. 

He points out that residents of Texas a& required to eerve a8 member8 of 

the Board of Directors of the corporation. 

Pursuant to a resolution adcp'ted by the Executive Committee of the 

Board of Directors of the corpotietion on January 23, 1961, the B'NAI BS(m 

HOME AND HOSPITAL has irrevocably committed all of the property passfng to 

it, under the will in question, "for uBe for charitable purposes exelusivelg 

within the State of Texas, Arkansas, TeMesaee and Ioulsiana. . .n A copy 

of this resolution has been transmitted by the President of the corporation 

to the Honorable Robert S. Calvert, Comptroller of Public Accounts for the 

State of Texas, ,tcgether with a letter on behalf of the corporation stating 

that it is "a charitable organization which conducts its operation on a 

regional basis, which includes the State of TexaB." 

We do not believe that this devise qualifies for exemption under the 

provfsiona of Article 14.06. U&r the eubmitted facts and, indeed by the 

express terms of the by-laws of the Home, its residents which are drawn 

from within the geographical limits of District Grand Lodge #7, which embrace seven, not five states. In view of this and our holding above 88 

to The National Jewish Hospital at Denver, we are constrained to hold that 

an exemption under the provisions of Article 14.06 cannot be obtained 

unless and until the funds fn question are irrevocably ccemultted to the 

exclusive use in Texas. 
Honorable Robert S. Calvert, page 6 (~~-11446) 

The devise to The &bia Temple Crippled Children'8 

Clinic is exempt from inheritance taxes. 

The devise to The National Jewish Hospital at Denver 

and the devise to the B'NAI B'Rith Old Folka Home, 

under the present state of facts, is not exempt frcsn 

inheritance taxes. 

Yours very truly, 

w1LT.l wILsoN 

Attorney General of Texas 

By: W. V. Geppert 

Aasiatant Atbrney General 

OPINION COMMITTEE 

Morgan Nesbitt, Chairman 

Linward Shivers 

Riley Fletcher 

Wm. R. Hemphill 

REVEWEDFORTHEAl'POIUYEYGENERAL 

BY: Leonard Paeamore