reglab/statecodes huggingface dataset:
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5 - Specific Exemptions › Section 13801.2 - Several Transfers to Same Person

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
When more than one transfer has been made after July 27,
					 1917 (the effective date of the Inheritance Tax Act of 1917), by a transferor
					 to the same person, the latter is deemed to have received by a single transfer
					 the entire property involved and is entitled to but one specific exemption. The
					 amount of the exemption is governed by the following:
(a) Transfers on or After June 25, 1935.
If each transfer was made on or after June 25, 1935 (the
					 effective date of the Inheritance Tax Act of 1935), the exemption allowable is
					 the exemption in effect at the date of the transferor's death.
(b) Incomplete Transfer Between July 27,
				  1917, and June 25, 1935, Plus Transfer upon Death on or After June 25, 1935.
If an incomplete transfer (see Section
					 13304.2), was made during the life
					 of the transferor on or after July 27, 1917, but prior to June 25, 1935, and a
					 second transfer was made upon the transferor's death on or after June 25, 1935,
					 the exemption allowable is the exemption in effect at the date of the
					 transferor's death.
(c)
				  Complete Transfer Between July 27, 1917, and June 25, 1935, Plus Transfer upon
				  Death on or After June 25, 1935.
If a complete transfer (see Section
					 13304.1), was made during the life
					 of the transferor on or after July 27, 1917, but prior to June 25, 1935, and a
					 second transfer was made upon the transferor's death on or after June 25, 1935,
					 and at a time when the specific exemption in force was different from that in
					 force when the first transfer was made, the exemption allowable is as
					 follows:
(1) If the amount of the
				  property involved in the first transfer was equal to or greater than the
				  exemption in force at the time of the transfer, and in excess of the exemption
				  in force at the date of the second transfer, an exemption equal to the amount
				  of the exemption applicable at the date of the first transfer is
				  allowable.
(2) If the amount of the
				  property involved in the first transfer was less than the exemption in force at
				  the time of the transfer, but in excess of the exemption in force at the date
				  of the second transfer, an exemption equal to the amount of the property
				  involved in the first transfer is allowable.
(3) If the amount of the property involved in
				  the first transfer was less than the exemption in force at the time of the
				  transfer, and less than the exemption in force at the date of the second
				  transfer, a total exemption equal to the amount of the exemption applicable at
				  the date of the second transfer is allowable.
NOTE: As to the computation of tax where there are several
					 transfers to the same person, see Section
					 13408.
NOTE: Reference: Section
					 13801,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5 - Specific Exemptions › Section 13801.3 - Independent Gift and Power of Appointment to Same Person

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) Transfers on or After June 25, 1935.
				  Should any person on or after June 25, 1935 (the effective date of the
				  Inheritance Tax Act of 1935), receive both a power of appointment subject to
				  the Inheritance Tax Law (see Revenue and Taxation Code Section
				  13694)
				  over particular property and an outright bequest or devise of other property
				  from the same transferor, the specific exemption allowable is governed by the
				  following:
(1) General Power of Appointment.
				  If the power is general in nature, or if it is limited in nature but the donee
				  may use or otherwise receive benefit from the property subject to the power,
				  the value of the property subject to the power is aggregated with the value of
				  the property bequeathed or devised, and one exemption is allowed on the whole.
				  This exemption is the one in effect at the date of the transferor's
				  death.
(2) Limited Power of
				  Appointment. If the power is limited in nature, and the donee cannot use or
				  otherwise receive benefit from the property subject to the power, an exemption
				  is allowed on the bequest or devise, but none is allowed on the property
				  subject to the power, unless the exemption allowed on the bequest or devise
				  exceeds the amount of the latter, in which case the surplus will be allowed
				  against the property subject to the power. The exemption applicable is the one
				  in effect at the date of the transferor's death.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5.1 - Charitable Exemption › Section 13841 - Transfers to State of California

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Transfers to the State of California include transfers to
					 any department, board, commission, or other agency of the State.
NOTE: Reference: Section
					 13841,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5.1 - Charitable Exemption › Section 13841.1 - Transfers to United States

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Transfers to the United States include transfers to any
					 department, board, commission, or other agency of the United States.
NOTE: Reference: Section
					 13841,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5.1 - Charitable Exemption › Section 13841.2 - Transfers to Public Corporations

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Transfers to public corporations include transfers to any
					 county, city and county, city, or district of this State; to any housing
					 authority created pursuant to the "Housing Authorities Law" of California; to
					 the University of the State of California; and to the State Bar of
					 California.
NOTE: Reference: Section
					 13841,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5.1 - Charitable Exemption › Section 13842 - Charitable Organization

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
An organization will ordinarily be considered to be
					 charitable in character if it is one organized and existing for the principal
					 purpose of promoting the welfare of mankind at large, or of a community, or of
					 some class forming a part of it indefinite as to numbers and individuals, and
					 operates without pecuniary profit or gain to its incorporators, shareholders,
					 or members. Among other organizations that commonly fall in this category are
					 the American National Red Cross; the Boy Scouts of America; and religious,
					 social, educational, recreational, and cemetery nonprofit corporations
					 organized pursuant to Division 2 of Title 1 of the Corporations Code.
NOTE: Reference: Section
					 13842,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5.1 - Charitable Exemption › Section 13842.1 - Charitable Transfer Generally

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
In general, a charitable transfer includes any transfer for
					 the benefit of an indefinite number of unnamed persons and designed to do any
					 of the following:
(a) Bring them under
				  the influence of religion or education.
(b) Relieve them from disease or
				  suffering.
(c) Assist them to
				  establish themselves in life.
(d)
				  Erect or maintain public buildings or works.
(e) Otherwise lessen the burdens or make
				  better the conditions of the general public or some class of the general
				  public.
NOTE: Reference: Section
					 13842,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5.1 - Charitable Exemption › Section 13842.2 - Religious Charitable Transfer

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
A transfer to or for a conceded and established religious
					 organization for any of its purposes will generally be considered as charitable
					 in nature. Such a transfer may be in the form of a gift for the beautification
					 or maintenance of the organization's place of worship, for the maintenance of a
					 cemetery operated by it, for the purchase of equipment, or for use in
					 missionary purposes.
NOTE: Reference: Section
					 13842,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5.1 - Charitable Exemption › Section 13842.3 - Transfer for Care of Cemetery Plot

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
A transfer to an individual in trust for use in caring for
					 the transferor's burial plot is not a charitable transfer. On the other hand, a
					 transfer or contribution to a private cemetery organization in California for
					 deposit in the latter's perpetual or special care fund, and for use in caring
					 for the transferor's burial plot located within the organization's cemetery, or
					 for use in caring for the transferor's and any other person's burial plot
					 located within the cemetery, is a charitable transfer.
NOTE: Reference: Section
					 13842,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5.1 - Charitable Exemption › Section 13842.4 - Educational Charitable Transfer

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
A transfer to or for an institution established for the
					 purpose of advancing the learning or education of an indefinite and
					 undetermined group of people, and not operated for private gain, is ordinarily
					 charitable in nature. The charitable character of the transfer is not vitiated
					 by the fact that the institution may charge tuition, if its income from such
					 source is used for its support and is not diverted to private purposes.
Transfers for the founding of public institutions of
					 learning, for providing scholarships for worthy young men and women, for the
					 establishment of university chairs, and for the maintenance of public libraries
					 are all charitable in nature.
NOTE: Reference: Section
					 13842,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5.1 - Charitable Exemption › Section 13842.5 - Transfers for Indigent and Dependent People

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Commonly within the category of charitable transfers are
					 transfers for the use of widows and orphans, transfers for placing and
					 maintaining free beds in hospitals for deserving sick people in indigent
					 circumstances, transfers to orphan asylums, and transfers to public
					 institutions for the blind.
NOTE: Reference: Section
					 13842,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5.1 - Charitable Exemption › Section 13842.6 - Transfers for Benefit of Animals

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Charitable transfers are not limited to those for the
					 benefit of mankind, but may also take form as transfers for the benefit of
					 animals, as, for example, to prevent cruelty to them.
NOTE: Reference: Section
					 13842,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5.1 - Charitable Exemption › Section 13842.7 - Transfer for Promotion of Political Purposes

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
A transfer for the promotion of political purposes may be
					 charitable in nature if the ends sought are not opposed to good morals and can
					 be attained by peaceable means, and not by war, riot, or revolution. However,
					 the charitable exemption is not applicable if the transfer is made to an
					 organization a substantial part of the activities of which is carrying on
					 propaganda or otherwise attempting to influence legislation.
NOTE: Reference: Section
					 13842,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5.1 - Charitable Exemption › Section 13842.8 - Proof Required

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Any person who claims a charitable exemption must submit
					 such documents or evidence to the State Controller or the inheritance tax
					 referee as may be requested by either of them.
NOTE: Reference: Section
					 13842,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5.2 - Intangibles Exemption › Section 13851 - Nature, Scope and Amount

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
A transfer of intangible personal property subject to the
					 Inheritance Tax Law by a nonresident transferor (see Section
					 13303.2(d)), is
					 exempt from the Inheritance Tax Law in the amount of the property transferred
					 if the transferor at the time of his death was a resident of a foreign state or
					 country which then imposed a legacy, succession, or death tax in respect to the
					 intangibles of its own residents, but either:
(a) Did not impose such a tax in respect to
				  intangible personal property of residents of this State; or
(b) Had a reciprocity provision in its law
				  exempting from its tax the intangibles of nonresidents of other jurisdictions
				  whose laws, in turn, contain a similar exemption.
It will be noted that intangible personal property
					 belonging to a nonresident transferor residing in the United States is not
					 subject to the Inheritance Tax Law.
NOTE: Reference:Section
					 13851,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5.2 - Intangibles Exemption › Section 13851.1 - Proof Required

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
If a court proceeding to determine the inheritance tax is
					 pending, any person who claims an intangibles exemption must file a declaration
					 with the inheritance tax referee on form IT-2, entitled "Declaration Concerning
					 Residence." If no court proceeding to determine the tax is pending, the claim
					 must be supported by an affidavit on form IT-23, entitled "Residence Affidavit
					 and Request for Consent to Transfer," and an affidavit on form IT-23A, entitled
					 "Rider to Be Attached to Residence Affidavit and Request for Consent to
					 Transfer, Form IT-23, ... ," if decedent was a nonresident of the United
					 States, filed with the Inheritance Tax Division of the Controller's office in
					 Los Angeles, Sacramento, or San Francisco. Copies of the forms may be obtained
					 from the Inheritance Tax Division.
NOTE: Reference: Section
					 13851,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5.2 - Intangibles Exemption › Section 13851.2 - Foreign State or Country

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
For the purpose of the Inheritance Tax Law the term
					 "foreign state or country" means any jurisdiction other than one embraced
					 within the United States.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 5.3 - Pension Exemption › Section 13880 - Pension Exclusion

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Public retirement system pensions, retirement allowances,
					 optional benefits and other rights and the right of any person, whether the
					 decedent or not, are exempt from the tax imposed by the Inheritance Tax Law.
					 "Public retirement system" includes United States federal and other states of
					 the United States, but does not include persons not directly employed by such
					 government. "Pensions, retirement allowances and optional benefits" shall
					 include amounts contributed by the employee to public retirement systems, plus
					 the increase and earnings of such contributions.
NOTE: Reference 13880, Revenue and Taxation
					 Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13951 - Market Value

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The value of each item of property included in any transfer
					 subject to the Inheritance Tax Law is ordinarily the market value of the
					 property on the date of the transferor's death. "Market value," as a general
					 rule, is the price that a willing buyer would pay to a willing seller of
					 property, neither being under any compulsion to buy or sell.
If there is more than one unit of property included in a
					 transfer, the market value of the whole will be determined by ascertaining the
					 market value on the date of the transferor's death of each individual unit. In
					 the case of a gift of stocks or bonds, each stock or bond will be treated as an
					 individual unit.
All relevant facts and elements of value as of the date of
					 the transferor's death will be considered in the determination of value.
					 Depreciation or appreciation in value subsequent to the date of death are not
					 relevant factors and will not be considered.
NOTE: Reference: Section
					 13951,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13951.1 - Real Property-in General

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The market value of real property for inheritance tax
					 purposes will depend upon all the facts and circumstances in each case. In
					 making the valuation all relevant and competent evidence will be given
					 consideration.
NOTE: Reference: Section
					 13951,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13951.2 - Local Assessed Value

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Unless it represents the actual market value of the
					 property, the assessed value of real property for ad valorem taxation will not
					 be accepted as the value thereof for inheritance tax purposes.
NOTE: Reference: Section
					 13951,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13951.3 - Securities-in General

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The value of stocks or bonds is, generally, the market
					 value per share or bond on the date of the transferor's death.
NOTE: Reference: Section
					 13951,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13951.4 - Listed Securities and Unlisted Securities Traded on Open Market

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) Selling Prices.
In the case of stocks or bonds which have a market, on a
					 stock exchange, in an over-the-counter market, or otherwise, the mean between
					 the highest and lowest quoted selling prices on the date of the transferor's
					 death will be deemed the market value per share or bond.
If there were no sales on the date of the transferor's
					 death, but there were sales on dates within a reasonable period both before and
					 after the date of death, the market value is determined:
(1) By taking the means between the highest
				  and lowest quoted selling prices on the nearest date before and the nearest
				  date after the date of death;
(2)
				  By then prorating the difference between such mean prices to the date of death,
				  considering only the respective numbers of trading days between the selling
				  dates and the date of death in such proration; and
(3) By finally adding or subtracting, as the
				  case may be, the prorated portion of the difference to or from the mean price
				  on the nearest date before the date of death. For example, assume that the date
				  of death is Friday, June 15, that sales of the stock nearest such date occurred
				  two trading days before (Wednesday, June 13) and three trading days after
				  (Wednesday, June 20), and that on these days the mean sale prices per share
				  were $10 and $15, respectively. Dividing the difference between the mean sale
				  prices ($5) by the number of trading days before and after the date of death (2
				  + 3) gives $1 per trading day. The portion of the difference attributable to
				  the period from the nearest date before the date of death to the date of death
				  (2 x $1) is $2. This amount added to the mean price on the nearest date before
				  the date of death ($10) equals $12. Accordingly, $12 will be taken as
				  representing the market value of a share of the stock on the date of death. If,
				  instead, on June 13 and June 20 the mean sale prices per share were $15 and
				  $10, respectively, $13 will be taken as representing the market value of a
				  share of the stock on the date of death. As another example, assume that the
				  transferor died on Sunday, October 7, and that Saturday and Sunday were not
				  trading days. If sales of stock occurred one trading day before (Friday,
				  October 5) at a mean sale price per share of $20 and one trading day after
				  (Monday, October 8) at a mean sale price per share of $23, then the market
				  value per share of stock as of the date of death is $21.50.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13951.5 - Additional Factors in Valuation of Listed and Traded Securities

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
In any case in which it is established that the value per
					 share or bond on the basis of selling or bid and asked prices does not reflect
					 the market value of a security, other relevant facts and elements of value will
					 also be considered in determining its market value. A case of this kind would
					 include one in which the sale of a listed stock on the date of the transferor's
					 death was made at a price arrived at on the basis of erroneous, false, and
					 misleading information concerning the affairs and financial condition of the
					 issuing corporation.
The so-called "blockage rule" is not recognized in
					 determining the value of securities for inheritance tax purposes.
NOTE: Reference: Section
					 13951,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13951.6 - Untraded and Closely Owned Securities

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) The value of corporate or other bonds not
				  traded on an open market is usually arrived at by giving consideration to the
				  security behind the bonds, the interest yield, the date of maturity, and other
				  relevant factors.
The value of shares of closely held stock is usually
					 arrived at by first ascertaining the net worth (the excess of the assets,
					 including good will, if any, over liabilities) of the corporation as a going
					 business, and then assigning to each share its proportion of such worth.
In determining net worth the tangible assets of the
					 business in question should be valued at their market value to a going concern,
					 and not at their cost to the particular business nor at their book
					 value.
(b) Among other
				  factors that will be considered in the valuation of closely held stock are the
				  following:
(1) The period of time that the
				  issuing corporation has been in existence and its position in the
				  trade.
(2) The nature of the
				  corporation.
(3) The operating
				  history of the corporation and, particularly, its earnings over a reasonable
				  period of time.
(4) The balance
				  sheet of the corporation.
(5) The
				  standard of earnings maintained by concerns engaged in similar lines of
				  endeavor.
(6) The strength and
				  danger of competition, both existing and potential.
(7) The management and personnel.
(8) The effect of possible governmental
				  regulation.
(9) The present and
				  future requirements of the corporation in the matter of new land, buildings, or
				  equipment.
(10) Current business
				  policy.
(11) Dividend payment
				  history.
(12) The prices paid on
				  private sales of the shares to persons who were in a position to know their
				  value.
(13) The prospects for
				  future earnings.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13951.7 - Good Will-General Method of Valuing

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Unless the facts and circumstances of a particular case
					 require the use of a different method, the valuation of good will is arrived at
					 as follows:
(a) Determine the total
				  amount of assets used in the business, other than good will, patents,
				  trademarks, copyrights, and the like.
(b) Determine the liabilities of the business
				  and deduct the amount thereof from the sum determined pursuant to subdivision
				  (a).
(c) Determine what percentage
				  of the difference determined pursuant to subdivision (b) represents a fair
				  return thereon (in the absence of evidence to the contrary, 15 percent thereof
				  will ordinarily be considered a proper percentage of return), and then multiply
				  the amount of such difference by the percentage determined. The product will
				  represent the amount of a fair return.
(d) Determine the average net profit of the
				  business for a reasonable period immediately prior to the date of the
				  transferor's death. Five years will ordinarily represent a "reasonable
				  period."
(e) Deduct the amount of
				  the fair return determined pursuant to subdivision (c) from the average net
				  profit.
(f) Determine the "number
				  of years purchase period." By this is meant the number of years after a sale of
				  the business for which a buyer, as part of the purchase price, would pay the
				  seller the average net profit of the business. Unless the nature and character
				  of the business in any particular case require a different figure, the number
				  of years purchase period will be considered to be five years.
(g) Multiply the difference between the
				  amount of fair return and the average net profit, as determined pursuant to
				  subdivision (5), by the number of years purchase period. The product will
				  constitute the amount of good will.
NOTE: Reference: Section
					 13951,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13951.8 - Other Factors Considered in Valuing Good Will

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Among other factors to be considered in the valuation of
					 the good will of a business are those listed in subdivisions (1) to (13) of
					 Section
					 13951.6.
NOTE: Reference: Section
					 13951, Revenue and Taxation
					 Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13951.9 - Insurance

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The value of life, accident, or war risk insurance is the
					 full amount of the proceeds thereof subject to the Inheritance Tax Law (see
					 Sections 13722 through
					 13724.1 and Revenue and Taxation
					 Code Sections
					 13721
					 through
					 13724
					 and
					 13861).
NOTE: Reference: Section
					 13951,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13951.10 - Notes and Accounts Receivable

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The value of a note or account receivable, whether secured
					 or unsecured, is presumed to be its face value plus accrued interest, if any,
					 to the date of the transferor's death. A lower value may be established by the
					 submission of satisfactory proof.
NOTE: Reference: Section
					 13951.8,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13951.11 - Interest in Business

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
In determining the value of any business or interest
					 therein, a fair appraisal as of the date of the transferor's death should be
					 made of all assets of the business, both tangible and intangible, including
					 goodwill, and the business or interest therein should be given a net value
					 equal to the amount which a willing purchaser, whether an individual or a
					 corporation, would pay therefor in view of the new value of the assets of the
					 business and its demonstrated earning capacity.
All factors relative to the valuation of other property, if
					 applicable, will be considered in determining the valuation of a proprietary or
					 partnership interest in a business. All evidence bearing upon such valuation
					 should be submitted to the State Controller or the inheritance tax referee,
					 including copies of reports in any case in which examinations of the business
					 have been made by accountants, engineers, or other technical experts as of or
					 near the date of the transferor's death.
NOTE: Reference: Section
					 13951,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13951.12 - Patent, Trademark, or Copyright

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The value of a patent, trademark, or copyright is usually
					 the present worth of the estimated future earnings thereof.
NOTE: Reference: Section
					 13951,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13951.13 - Growing Crop

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Among other factors to be considered in the valuation of a
					 growing crop are the following:
(a)
				  The probable market value of the crop when harvested.
(b) The probable cost of producing and
				  marketing the crop.
(c) The price,
				  if any, paid at or about the date of the transferor's death for futures in the
				  same kind of crop.
NOTE: Reference: Section
					 13951,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13952.1 - Estates, Income and Annuities for Life of One Person

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) The present value of a life estate in
				  property, the income from which is to be paid annually in an unfixed amount to
				  a single life tenant is computed as follows:
(1) Determine the age and sex of the life
				  tenant as of his or her birthday nearest the date of the transferor's
				  death.
(2) Consult Table A(1) or
				  Table A(2), whichever is appropriate, in Section
				  13953, and ascertain therefrom the
				  life estate factor (the present value of a life estate of $1 per year) for the
				  life of a person of the same age as the life tenant.
CAUTION:
Table A(1) is the appropriate table
					 if the life tenant is a male person. Table A(2) is the appropriate table if the
					 life tenant is a female person. The user of the tables should exercise care to
					 refer to the appropriate table in each case.
(3) Multiply the appraised value of the
				  property by the life estate factor obtained pursuant to step (2). The product
				  will be the present value of the life estate at the time of the transferor's
				  death.
The provisions of subdivision (a) may be illustrated by the
					 following examples:
EXAMPLE (1).
A bequeaths the annual income from $100,000 to B for life,
					 with remainder over to C. B, a male, at the time of A's death is 40 years of
					 age. Table A(1) indicates that the life estate factor is .78923. The present
					 value of B's life estate as of the date of the transferor's death is $78,923
					 ($100,000 x .78923).
EXAMPLE (2).
A bequeaths the annual income from $100,000 to D for life,
					 with remainder over to E. D, a female, at the time of A's death is 40 years of
					 age. Table A(2) indicates that the life factor is .84281. The present value of
					 D's life estate as of the date of the transferor's death is $84,281 ($100,000 x
					 .84281).
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13952.3 - Life Estate, Successive Life Estate and Remainder

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
If income or an estate is transferred to one person for his
					 use or enjoyment during his life and upon death of that life tenant to another
					 person for the latter's use or enjoyment for life, and upon death of the latter
					 life tenant the remainder is transferred to a third person, the present values
					 of the respective interests of the three persons as of the date of the
					 transferor's death are computed as follows:
(a) Determine in accordance with Section
				  13952.1
				  the present value of the primary life tenant's life estate.
(b) Determine in accordance with Section
				  13952.1 the present value of the
				  secondary life tenant's normal life estate as though he or she were the only
				  life tenant.
(c) The present value
				  of the secondary life tenant's successive life estate in the property as of the
				  date of the transferor's death is determined by subtracting the present value
				  of the primary life tenant's life estate, as computed pursuant to step (a),
				  from the secondary life tenant's single life estate, as computed to step
				  (b).
(d) The present value or worth
				  of the remainder interest in the property is determined simply by subtracting
				  the present value of the secondary life tenant's single life estate, as
				  obtained pursuant to step (b), from the appraised value of the property.
The provisions of this regulation may be illustrated by the
					 following example:
EXAMPLE.
Decedent bequeaths the annual income from $300,000 in trust
					 to A, a female, for life. Upon the death of A the annual income is payable to
					 B, a male, for life, and upon B's death the remainder payable to C. At the date
					 of death, the ages of A and B, respectively, are 66 and 42. Table A(2) of
					 Section 13953 indicates the life estate
					 factor in column 3 for a female age 66 is .54211. The present value of A's life
					 estate, as of the date of decedent's death, is $162,633 ($300,000 x .54211).
					 Table A(1) indicates the life estate factor for a male age 42 is .76967. The
					 present value of B's single life estate as of the date of the decedent's death
					 is $230,901 ($300,000 x .76967). The present value of B's successive life
					 estate as of the date of the decedent's death is $68,268 ($230,901 - $162,633).
					 The present value of C's remainder interest in the property as of the date of
					 decedent's death is $69,099 ($300,000 - $230,901).
NOTE: Reference: Section
					 13952, Revenue and Taxation
					 Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13952.4 - Estates, Income and Annuities for Period of Years

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) The present value of an estate in
				  property, the income from which is to be paid annually in the unfixed amount
				  for a term of years is computed as follows:
(1) Consult Table B of Section
				  13953, and ascertain therefrom the
				  income factor for a term of years in column 3 opposite the figure in column 1
				  representing the number of years for which the income is to continue.
(2) Multiply the appraised value of the
				  property by the income factor obtained pursuant to step (1), which will give
				  the present value of the estate for the term of years as of the date of the
				  transferor's death.
(3) Present
				  worth of the remainder interest in the property is determined simply by
				  subtracting the present value of the estate for the term of years, as
				  determined pursuant to step (2), from the appraised value of the property.
The provisions of this subdivision may be illustrated by
					 the following example:
EXAMPLE.
Decedent bequeaths to A the possession, use and enjoyment
					 of real property for seven years. At the end of the seventh year, the property
					 is to be transferred to B. At decedent's date of death, A is 60 years of age
					 and the real property is appraised at $50,000. By reference to Table B, the
					 income factor for a term of years in column 3 opposite seven in column 1,
					 representing the number of years for which the income is to continue, is found
					 to be .334943. The present value of A's estate for the seven years is $16,747
					 ($50,000 x .334943). The present worth of B's remainder interest in the
					 property as of the date of the decedent's death is $33,253 ($50,000 -
					 $16,747).
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13952.5 - Deferred Bequest

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a)
				  Bequest Payable at Death of Person Other Than Transferee.
If a bequest is payable to a transferee at the death of
					 another person, the present value of the bequest as of the date of the
					 transferor's death is computed as follows:
(1) Determine the age of the person at whose
				  death the bequest is payable as of his birthday nearest the date of the
				  transferor's death.
(2) Consult
				  Table A(1) or Table A(2), whichever is appropriate, in Section
				  13953, and ascertain therefrom the
				  remainder factor of $1 due at the death of a person of the same age as a person
				  at whose death the bequest is payable.
(3) Multiply the amount of the bequest by the
				  remainder factor determined pursuant to step (2). The product will represent
				  the present worth of the bequest as of the date of the transferor's death.
The provisions of subdivision (a) may be illustrated by the
					 following example:
EXAMPLE: Decedent bequeaths to A, to be paid at the death
					 of X, a female, property having a value of $60,000 at the decedent's date of
					 death. At the decedent's date of death, X is 70 years of age. By consulting
					 Table A(2), the remainder factor in column 4 opposite 70, the number
					 representing X's age, is .52460. This remainder factor multiplied by the
					 appraised value of the property ($60,000) results in a product of $31,476, the
					 present worth of the bequest to A as of the date of the decedent's
					 death.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13952.6 - Present Value of Annuity Exceeding Value of Annuity Fund

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Where the present value of an annuity actually exceeds the
					 amount of the property or fund out of which the annuity is to be paid the
					 present value of the annuity is the amount of the property or fund. This
					 regulation may be illustrated by the following example:
EXAMPLE.
A bequeaths to B, a female, a life annuity of $5,000 per
					 year, payable out of a fund totaling $35,000. B is 65 years of age at A's
					 death. Computed in accordance with
					 13952-13954(b),
					 the present value of an annuity of $5,000 per year for the life of a female of
					 the age of 65 is $46,503 ($5,000 x 9.3005 = $46,503). Since this exceeds the
					 annuity fund of $35,000, the latter figure will represent the present value of
					 B's annuity.
NOTE: Reference: Section
					 13952, Revenue and Taxation
					 Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13952.7 - Remainder

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The present worth of a remainder is obtained by computing
					 the present worth of the precedent estate or estates and subtracting the amount
					 thereof from the total value of the property involved. The difference will
					 represent the present worth of the remainder.
The present worth of a remainder interest after a life
					 estate may also be obtained by multiplying the appraised value of the subject
					 property by the remainder factor in Table A(1) or Table A(2), whichever is
					 appropriate, of Section
					 13953 opposite the age of the
					 person possessing the precedent estate. This regulation may be illustrated by
					 the following examples:
EXAMPLE.
A bequeaths the annual income from $100,000 to B for life
					 with remainder over to C. B, a male, at the time of A's death is 40 years of
					 age. By an application of the method set forth in Section
					 13952.1
					 for determining the present value of a life estate, B's life interest is found
					 to be $78,923. This latter sum subtracted from $100,000 results in a difference
					 of $21,077, the present value of C's remainder.
EXAMPLE.
Using the same facts as set forth in example immediately
					 above, the remainder factor for a male 40 years of age (the age of the
					 lifetenant) is .21077. The present value of C's remainder interest is $21,077
					 ($100,000 x .21077).
NOTE: Reference: Section
					 13952, Revenue and Taxation
					 Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13952.8 - Annuity Contract

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The value of an annuity contract issued by a company
					 regularly engaged in the selling of contracts of that character is, ordinarily,
					 the cost of the contract.
It is to be noted that an annuity contract is not a life
					 insurance policy. Consequently, the exemption mentioned in Section
					 13723 is not allowable on any
					 payment made under any such contract.
NOTE: Reference: Section
					 13952,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13952.9 - Joint Life and Survivorship Annuity Contract

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) Survivor Made No Contribution.
If the survivor made no contribution towards the purchase
					 of the contract, the value of a joint and survivorship contract issued by a
					 company regularly engaged in the selling of contracts of that character is,
					 upon the death of the purchaser annuitant, the present value at the purchaser's
					 death of the annuity payable to the survivor for the balance of his
					 life.
(b) Survivor Made
				  Contribution.
If the survivor made some contribution towards the purchase
					 of the contract, the value of a joint and survivorship contract issued by a
					 company regularly engaged in the selling of contracts of that character is,
					 upon the death of any one of the annuitants, that portion of the present value,
					 at the death of the deceased annuitant, of the annuity payable to the survivor
					 for the balance of his life which bears the same ratio to the total present
					 value as the contribution made by the deceased annuitant bears to the total
					 contributions of both annuitants.
NOTE: As to the taxation of joint life and survivorship
					 annuities, see Section
					 13648.
NOTE: Reference: Section
					 13952,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13952.10 - Refund Annuity Contract

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The value of a refund annuity contract at the date of the
					 annuitant's death is:
(a) The full
				  amount payable to the beneficiary, if such amount is payable in a lump
				  sum.
(b) The present value at the
				  annuitant's death of the amount payable to the beneficiary, if such amount is
				  payable periodically or in the form of an annuity.
NOTE: As to the taxation of refund annuities, see Section
					 13648.1.
NOTE: Reference: Section
					 13952,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 6 - Valuation › Section 13956 - Contingent Encumbrances and Contingencies

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) In the valuation of any property in which
				  a transferee is given a present right of enjoyment or possession, no allowance
				  will be made on account of any contingent incumbrance on the property, nor on
				  account of any contingency upon the happening of which the transferee's
				  interest might, in whole or in part, be abridged, defeated, or diminished. If,
				  however, the incumbrance or contingency should become effective after the
				  transferee has become possessed, or has entered upon the enjoyment, of the
				  property, and an inheritance tax has been paid, a refund of tax may be secured
				  by the person who paid the tax.
(b)
				  Under proper circumstances, any tax due in respect to the transfer of any
				  property covered by this regulation may be the subject of a compromise, see
				  Revenue and Taxation Code Sections
				  14191
				  and
				  14192.
NOTE: Reference: Section
					 13956,
					 Revenue and Taxation Code.