The Idaho world. [volume] (Idaho City, Idaho Territory) 1864-1918, 1866-04-14
TREASURY DEpARTMENT.
0FFscE OF INTERNAL REVENUE,
WASHINGTON, January 80. 1866.

TREASURY DEPARTMENT,
Il OFF5CE OF INTERNAL Revenue
WASHINGTON, January 80 1866.
The petition Of Jas. E. Lyon, for abatement oi
tax assessed upon him for income acquired during
the year 1864, has been received and consideYSs.
From the papers accompanying the petition, it
would seem that Dir. Lyon was assessed by you
upon an income of l00 900, derived CexceptiDg
the sf of $4,000 from the profits upon the sale,
in 1864, of what called thinning claims" or
gold claims, purchased III Coiorad5, in the year
Fl8G2. And it is now claimed that such assess
ment is illegal, because the property in such
claims is held in Colorado to be real estate; and
the profits thereon are, therefore, exempt from
tax, by virtue OF pr0visO IN section l16, act of
1866, which declares that the pr offs upon real es
tate are only TO, be taxed as income, when the
purchase and sale are both made within the same
ByeaF. In the able and elaborate and printed ar
gument of the counsel for the petitioner, is this
admission: 1T is conceded that the records of
| the land department will show no action by the
! Governments of the United States, in respecb to
1.-THE right OF settlers upon public lands in Colorado.
I9ere has been no legislation specifically upon the
subject. 1t is conceded; also, that the Govern
ment has parted With none of its absolute rights,
such Fights cannot be acquired IN the public lands
| by occupancy or limtatiOn4'
! The ground is, however, taken that notwith-
standing the Government stllretainS all its abso.
Lutte rights, as owners of the land, yet, under the
peculiar circumstances of the case, the miner has
a cO-existing interest in the same lad which NAV
fbe included in the terIEn' real state as used in
the revenue law and without reference to the To-
hcal law, it is doing no violence to- the statute to
give it such an Interpretation. il. ~
Bat as the argument in support Of that position
Is not fortified by reference to- any other statute
or to any judicial decision I may be excused from
inoticng it further than to say that it seems to me
to be more ingenious than sound
/ The main point for my consideration, seems to
me to be, that which relates to the force, which
10 tn i'm 70 iho
Colorado
Taxing it, for granted that tie law of that Ter.
EFltOrYS, mathis respect, what it is alleged to be
I by tho petitioner, am brought at once to the
question whether in determining what constitute
real estate, = i amsto be guided in administering
the Internal Revenue Law by the judicialldeeis
ions, or legislative enacments of the several States
and Territories; or, whether a rule shall be adop.
ted, that will be general inits application to- all,
without reference to such decisions, and enact
ment. t.,..
By section 1916, Act of 1854. I3 vol. Statutes, at
large 275 it is declared That for the purpose of
this Act the teTm "real estate" Shall include all
lands tsnsEents and Entertainments corporeal
sand incoporeal'" But the question at once
arises, what are lands, tenements, and heredita-
ments? and what Is the rule Of Interpretation to
be applied to those terms?
By the law of louisiana animals and implements
Of agriculture, when in actual use, for the i'm
provement of planta ton, are considered as ac
cessOres' of such plantations, and the deed which
conveys the s'plantation, carries with it the title
of such animals and implements. They are inclu.
ded by tha,law of that State within the iurlsdic.
ton of rsaf estate as given in section l26 LII 9th.
Fer States, they not SO included. And so OF
certain leaSeh0ld interests in land, which in one
State are includedin the above statute definitions,
and in another State are not included
The case which is now presented IN relation to
mining claims, is perhaps of greater moment than
those already referred to, and which have already
been discussed by this Office; but the principle
applicable those, seems to NE also applicable to
this. an
Sec. 81, Act of 1879; (stat t1lpge 62) provides:
THAT the laws of the several States, except when
the Constitution, Treaties. or Statutes OF the u
S. shall otherwise require or provide shall be re.
garded as rules of decision ia trials at Common
Law in the Courts of the United States where
they apply aas #e
Without referring 10 sfIe many judicial decisions
that have been made under the above section, and
without attempting to make any distinction be-
tween States and Territories in the application of
this rule, or as between those arising in the
administration of the Revenue Law, and those
arising 'ins the Courts of the United States the
inquiry. may be properly made whether the case
presented Jes not come within the exception sta
ted IN the Statute. ua5t@ 5st
1t is very clear that the laws of the several
States are not to be made rules of decision where
the Constitution, Statutes of the United States
fSnhIl OIDeTWlSea require OF provide. NOW SecyS
Art. l, of the Constitution in providing thatf"U0n
gress shall have the power to lay, aAd scoeet tax
es," atthe time eXpress declares tha<' 'aIl-
duties, imports apd excise shall beuniforM through
out the United States.'' But if Congress. in i'm
posing taxes and duties, must adopt rule that is
uniform it would seem to be the imperative duty
of executive officers, in giving construction to
that rule to doit in such n9anAeras to produced
d uniformity Of practice on, the part Of Govern
ment officers throughout the country. And in the
construction Of section %, already referred to,
know of no other way IN which such uniformity
be obtained, except by deciding that the words
of defnation used therein shall not be taken and
understood according to tie meaning given Them
by the local laws of the several States. The pro.
pyi:ty OF such rule may be seen in this that il
the fact Of what is real estate is to be determined
by local law it is clear that in estimating the |
amount Of taxable income, for any year, a burden
may be imposed upon the citizens Of some States |
from which tbs citizens of other States shall be
wholly exempt. And not-only may the then laws !
of different States be unlike on given year, as
in fact they are at present; but those Of the same
State may change annual y, or oftener; thus max
ing a rule which should be the same everywhere
during the existence Of the statdte, to plry, not
only to the particular locality, but also according
to Tie particular time in that locality, when the
tax is sought to be collected. Sucll a, result /
must regard as against bo-h tho spirit and letter
OF the Constitution. e.ss .
Asthe counsel for the petitioner has called my
attention to the fact that the stamp duty as tor
''realty soil" has been lately required by this
Office, upon the conveyance Of mining claim
which be alleges to be Similar to the above, and q"
ho Insists that, therefore, the present claim must