Evening star., 1932-03-16
STATES SET LIMITS
ON ESTATE TAXES
Keep Within U. S. Credits.
! o. C. Proposal Would
/ 0verstep Mark.
Continued From First Page.)

passed by State legislatures in session
during 1881. But it Is significant to
note that both of these provisions, in
cluded by many Of the States as benefi-
cial to the decedents estate, have been
omitted from the new proposed District
of Columbia estate tax bill, and are
noticeable for their absence.
Allows so Per Cent Credit.
The District of Columbia legislation
lines up with the estate tax laws of
most of the States, in that it provides
that the full 80 per cent credit allowed
by the Federal Government must be
forthcoming to be placed in the District
treasury. But prospects are, according
to both the Bureau of Efficiency report,
Just submitted to the Senate committee,
and to other analyses made of the
legislation, that estates in this city
would have to pay much more taxes
because certain restrictive measures
which some other States have included
In their laws are missing here.
For instance, Alabama provides In
its new legislation that the total State
tax is not to exceed in the aggregate
the Federal credit. Alabama's legisla-
ton, approved last July and effective
November 3, 1881, is written in COM
paratively simple language, as follows:
There Is hereby levied and imposed
upon the net estates passing by will,
devise or under the estate laws OF the
State of Alabama, tax of 80 per CEN
tum Of the tax imposed upon such net
estates by the act of Congress approved
February 3, 1926. The rates and the
definitions Of net estates shall be as
provided In said act Of Congress"
The State Of California provides
against collecting for the State more
than 80 per cent Of the Federal estate
tax by this clause in its State law:
Should the amount Of tax In this act,
increased by this section, be afterward
found to be more than the maximum
credit allowed under the Federal estate
tax act, then any excess over and above
the said maximum credit shall be re-
funded, as is provided in section IL OF
this act"
States Set Limit Of Tax.
The State of Michigan goes so far as
to provide that no more than the 80
per cent shall be collected, and refunds
are even to be made out of the primary
school funds" This unusual provision
reads as follows: upon the final Fed
eral determination of 80 per centum OF
the Federal estate tax the State treas
urer and auditor general shall refund
and pay back to the executor, admin
istrator or trustee Of such estate, or
other person interested hereunder, out
of the primary school fund all monies
heretofore paid to the appropriate
county treasurer under this act In ex-
cess of said 80 per centum which shall
have been paid pursuant to said provi-
sion requiring the payment of an
amount equal to the difference between
the total of such taxes hereinbefore i'm
posed. plus all other credits allowed by
the Federal act for taxes paid the State
governments, and 80 per centum Of the
tax which may be imposed by said
Federal revenue act, and mandamus
shall be available to such executor, ad-
ministrator, trustee and other person
to compel such refund and repayment"
Nebraska provides for State collection
Of no more than 80 per centum of the
Federal act by language which reads as
follows: "But in no event shall the
estate tax payable under the provisions
OF this act exceed the amount, If any,
by which the maximum credit allowable
to the estate against the United States
estate tax exceeds the credits herein
provided for in section l."
New Hampshire has another way of
saying it: provided that such estate
tax hereby imposed shall In no case ex-
ceed the extent to which its payment
viii effect saving or diminution in the
amount Of the United States estate tax
payable by or out Of the estate OF the
decedent had this act not been en-
acted"
Virginia's State Tax.
The nearby State of Virginia, which
Inc {y,I 70 T1rnhihifc
excessive collections under its estate
law by this language: This section
shall be always so construed as not to
increase the total amount of inheritance
taxes, State and Federal, payable upon
the estates of decedents, the only object
Of this section being to take full ad-
vantage of the credit allowed by the
act of Congress, hereinabove mentioned;
and If the said act of Congress should
be in any manner affected by subse-
quent legislation of Congress, this sec
ton shall be SO construed as to take
full advantage of such credit as the
laws of the United States may allow"
Iowa says: In no case shall tax
be collected hereunder which, altogether
with the credits allowed by this para
graph, shall exceed the maximum
credits allowed by said Federal estate
tax act for any estate, inheritance,
legacy or succession taxes actually paid
to any State or Territory of the United
States or the District of Columbia"
Montana restricts its State collections
to 80 per cent of the Federal levy this
way: SIN no event shall the tax pay
able under subdivision 4 Of this section
exceed the amount, If any, by which
the maximum credit allowable to the
estate against the United States estate
tax exceeds the credits provided for in
the preceding sentence of this section"
Certain other States have language
somewhat similar, but the above are
typical examples of how States arrange
their legislation to get the benefit Of
State estate tax without adding any
further burden on the estate than had
already been laid by the Federal estate
tax.
rrne District Of Columbia estate taY