reglab/statecodes huggingface dataset:
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.1 - Homestead and Family Allowance › Section 13621 - Transfer Effected by Vesting of Statutory Homestead

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
In the case of a homestead of a husband and wife created in
					 accordance with the Civil Code:
(a)
				  Community Property.
If the homestead was selected from community property, upon
					 the death of either spouse the vesting of the homestead in the survivor is
					 subject to the law as a transfer of community property from the decedent to the
					 survivor to the extent that the property is subject to the law. (See Revenue
					 and Taxation Code Section
					 13554).
(b) Separate Property of Either Spouse.
(1) Such Spouse Joined in Selection.
If the homestead was selected from the separate property of
					 either spouse, and such spouse joined in the selection, upon the death of such
					 spouse the vesting of the homestead in the survivor is subject to the law as a
					 transfer of the separate property of the decedent to the survivor. On the other
					 hand, if the spouse whose separate property was selected should be the
					 survivor, the vesting of the homestead in such spouse would not constitute a
					 transfer subject to the law.
(2) Such Spouse Did Not Join in Selection.
If the homestead was selected from the separate property of
					 either spouse, but such spouse did not join in the selection, upon the death of
					 such spouse the vesting of the homestead in the surviving spouse or any third
					 person is subject to the law as a transfer of the separate property of the
					 decedent. If the property vests in a person other than the surviving spouse or
					 a minor child of the decedent, the probate court may set the homestead apart
					 for the use of the surviving spouse or minor child in accordance with the
					 Probate Code. In such event, the setting apart of the property constitutes a
					 transfer of separate property to the surviving spouse or minor child which is
					 also subject to the law. In the determination of the tax, if any, on the
					 interest vesting in the person other than the surviving spouse or minor child,
					 allowance will be made for the interest passing to the surviving spouse or
					 child as a consequence of the setting apart of the homestead. Should the spouse
					 whose property was selected for the homestead survive his or her spouse, the
					 vesting of the homestead in the former does not constitute a transfer subject
					 to the law.
NOTE: Reference: Section
					 13621,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.1 - Homestead and Family Allowance › Section 13622 - Transfers Effected by Probate Homestead

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
In the case of a homestead created by a probate court in
					 accordance with the Probate Code:
(a)
				  Community or Section
				  201.5
				  Property. If the homestead is set apart from community property or property to
				  which Section
				  201.5 of the Probate Code is
				  applicable for the use of a surviving souse or minor child, the setting apart
				  of the homestead is subject to the law as a transfer of community property or
				  Section 201.5 property to such spouse or
				  minor child to the extent that the property is subject to the law. (See Revenue
				  and Taxation Code Sections
				  13551
				  and
				  13555).
(b) Separate Property.
If the homestead is set apart from the separate property of
					 a deceased spouse for the use of his or her surviving spouse or minor child,
					 the setting apart of the property is subject to the law as a transfer to the
					 surviving spouse or minor child. If the property set apart was bequeathed or
					 devised by the decedent to a person other than his or her surviving spouse or
					 minor child, the bequest or devise is also a transfer subject to the law. In
					 determining the tax, if any, on such transfer, allowance will be made for the
					 interest passing to the surviving spouse or child as a consequence of the
					 setting apart of the homestead.
NOTE: Reference: Section
					 13622,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.2 - Inter Vivos Transfers › Section 13641 - Consideration in Money or Money's Worth

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
For the purpose of the Inheritance Tax Law the term
					 "consideration in money or money's worth" does not include any consideration
					 not reducible to money or a money value, such as love and affection or a
					 promise of marriage.
NOTE: Reference: Section
					 13641,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.2 - Inter Vivos Transfers › Section 13642 - Contemplation of Death

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) In
				  General.
The term "contemplation of death" means that general
					 expectancy of death, whether immediate or distant, which ordinarily actuates
					 the mind of a person in the execution of his will. It is not restricted to an
					 expectancy of imminent or speedy death.
A transfer motivated by the above-described general
					 expectancy of death, without which it would not have been made, and made within
					 three years prior to the death of the transferor, is one in contemplation of
					 death notwithstanding that other motives were also present.
(b) Evidence.
Whether a transfer made inter vivos within three years
					 prior to the death of the transferor has or has not been made in contemplation
					 of death is a question to be determined after an examination of all the facts
					 and circumstances of each case.
NOTE: Reference: Section
					 13642,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.2 - Inter Vivos Transfers › Section 13644 - Transfer in Trust with Reservation of Income for Life

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Any irrevocable inter vivos transfer in trust under which
					 the trustee is to pay the income to the trustor during his life, and upon the
					 trustor's death deliver the corpus to the beneficiary is a transfer with
					 reservation of an income or interest for life and is subject to the Inheritance
					 Tax Law.
Note: As to a revocable transfer in trust, see Section
					 13646.
NOTE: Reference: Section
					 13644,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.2 - Inter Vivos Transfers › Section 13644.1 - Annuity Contract Plus Single Premium Life Policy

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The purchase of an annuity contract entitling the purchaser
					 to a specified annuity during the remainder of his life, together with a
					 so-called "single premium life policy" issued without a physical examination of
					 the purchaser and providing for the payment of a given sum to a named
					 beneficiary on the purchaser's death, insofar as the policy is concerned
					 constitutes a transfer intended to take effect in possession or enjoyment at or
					 after death and is subject to the Inheritance Tax Law, if it appears that the
					 policy would not have been issued without the contract. In such case, the
					 insurance exemption provided in Revenue and Taxation Code Section
					 13724
					 is not allowable against the proceeds of the policy.
NOTE: Reference: Sections
					 13721 to
					 13724, inclusive, 13861 and
					 13861.5, Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.2 - Inter Vivos Transfers › Section 13646 - Transfer with Reservation of Power to Revoke or Control

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
An inter vivos transfer conforming to Revenue and Taxation
					 Code Section
					 13641,
					 whether in trust or otherwise, subject to a power reserved in the transferor to
					 revoke, terminate, alter, amend, revise, or change the interest of the
					 beneficiary, constitutes a transfer intended to take effect in possession or
					 enjoyment at or after the death of the transferor, and is subject to the
					 Inheritance Tax Law.
A transfer in trust of intangible personal property located
					 outside this State by a nonresident trustor to a nonresident trustee for the
					 benefit of a third person, with a power reserved in the trustor to revoke,
					 terminate, alter, amend, revise, or change the interest of the beneficiary, is
					 subject to the Inheritance Tax Law if the trustor subsequently dies a resident
					 of California without having terminated, relinquished, or surrendered the
					 power; or subsequently becomes a resident of California and then terminates,
					 relinquishes, or surrenders the power in contemplation of death.
A power to revoke, terminate, alter, amend, revise, or
					 change the interest of a beneficiary includes a power exercisable either by the
					 transferor alone or by the transferor and any other person not having a
					 substantial adverse interest in the property transferred.
NOTE: Reference: Section
					 13646,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.2 - Inter Vivos Transfers › Section 13646.1 - Transfer with Reservation of Possibility of Reverter

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
If any property transferred by an inter vivos transfer not
					 otherwise subject to the Inheritance Tax Law, conforming to Revenue and
					 Taxation Code Section
					 13641,
					 may revert or revest in the transferor upon the prior death of the transferee
					 pursuant to an express provision in the instrument making the transfer and not
					 by reason of the statute of succession, and the transferor predeceases the
					 transferee, the transfer constitutes one intended to take effect in possession
					 or enjoyment at or after the death of the transferor and is subject to the
					 Inheritance Tax Law.
NOTE: Reference: Section
					 13646,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.2 - Inter Vivos Transfers › Section 13647 - Advancement

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
An "advancement," or gift made by an individual during his
					 lifetime to his child or other heir with the intention on the part of the donor
					 that such gift shall represent a part or the whole of that portion of his
					 estate which the child or other heir would inherit upon his death, is subject
					 to the Inheritance Tax Law.
NOTE: Reference: Section
					 13647,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.2 - Inter Vivos Transfers › Section 13648 - Joint Life and Survivorship Annuity

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) Purchased by Decedent.
If any person with his own funds purchases an annuity
					 payable to himself and any other person for their joint lives and then to the
					 survivor for his or her life, and the purchaser dies first, the right of the
					 surviving annuitant to the balance of the annuity constitutes a transfer to the
					 surviving annuitant subject to the Inheritance Tax Law.
(b) Purchased by Both Annuitants.
If each annuitant under a joint life and survivorship
					 contract contributes his or her own property for the purchase of the contract,
					 and either annuitant dies, the right of the surviving annuitant to such portion
					 of the balance of the annuity as is proportionate to the decedent's
					 contribution constitutes a transfer to the survivor subject to the Inheritance
					 Tax Law.
Note: As to the valuation of joint life and survivorship
					 annuities, see Section
					 13952.9.
NOTE: Reference: Section
					 13648,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.2 - Inter Vivos Transfers › Section 13648.1 - Refund Annuity

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The right of any beneficiary to the balance payable under a
					 refund annuity contract upon the death of the annuitant constitutes a transfer
					 subject to the Inheritance Tax Law.
NOTE: As to the valuation of refund annuities, see Section
					 13952.10.
NOTE: Reference: Section
					 13648,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.2 - Inter Vivos Transfers › Section 13648.2 - U. S. Savings Bond Payable on Death of One Person to Another

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
United States savings bonds may be purchased as "payable on
					 death" of one person to another. The provisions of the Inheritance Tax Law
					 relating to inter vivos transfers are applicable to such bonds (see Revenue and
					 Taxation Code Sections
					 13641
					 through
					 13648).
NOTE: As to the taxation of United States savings bonds
					 purchased in two names, see Section
					 13671.2.
NOTE: Reference: Section
					 13648,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.3 - Joint Tenancies › Section 13671 - Contribution Claim by Surviving Joint Tenant

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The basis for an allowance of contribution to a joint
					 tenancy by a surviving joint tenant is the claim therefor by the survivor in
					 completing the inquiry on form IT-22, Inheritance Tax Declaration.
Contribution claims are required to be traced back to their
					 remote origin to prove that the original source of the funds contributed by the
					 survivor was not the decedent. Thus, if a father gave money to his son and some
					 years later the son used this money to create a joint tenancy with the father,
					 the entire joint tenancy would be taxed at the father's death since the father
					 was the contributor of the funds when they are traced back to their remote
					 origin.
The contribution allowable to a surviving joint tenant must
					 be reduced by its proper proportion of certain of he deductions applicable to
					 the joint tenancy. Some of the allowable deductions under the Inheritance Tax
					 Law apply as a proportionate reduction of the entire joint tenancy. Others
					 apply only to the decedent's share of the joint tenancy.
(b) The deductions which apply over the whole
				  joint tenancy and thus operate as a proportionate reduction of the survivor's
				  gross contribution are:
(1) Attorneys' fees
				  relating to the joint tenancy.
(2)
				  Real property taxes on joint tenancy real property.
(3) Encumbrances on joint tenancy real
				  property.
(4) Appraisal fee for
				  joint tenancy property.
(5) Court
				  costs relating to the joint tenancy.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.3 - Joint Tenancies › Section 13671.1 - Examples of Joint Tenancy Between Three or More Persons

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Property held in joint tenancy by three or more persons is
					 subject to or excluded from the Inheritance Tax Law to the extent specified in
					 Revenue and Taxation Code Section
					 13671.
					 This may be illustrated by the following examples, in each of which it is
					 assumed that any property contributed by a surviving joint tenant never
					 belonged individually to the decedent:
EXAMPLE (1).
A, B, and C are joint tenants in property valued at
					 $100,000, all of which was contributed by A:
(A) If A dies first, the entire property will
				  be subject to the law at A's death. If thereafter the tenancy continues in
				  existence until the death of B or C, one-half of the property, or $50,000, will
				  be subject to the law at the date of the death.
(B) If B or C, or both, should predecease A,
				  none of the property will be subject to the law at B's or C's death.
(C) If B predeceases A and C, and A
				  predeceases C, the tenancy continuing in existence until A's death, none of the
				  property at B's death will be subject to the law, but all of it will be subject
				  thereto at A's death.
EXAMPLE (2).
A, B, and C are joint tenants in property valued at
					 $100,000, of which $50,000 was contributed by A, $25,000 by B, and $25,000 by
					 C:
(A) If A dies first, at his death
				  $50,000 will be subject to the law, and $50,000 will be excluded. If thereafter
				  the tenancy continues in existence until the death of B or C, at the date of
				  the death $50,000 will be subject to the law, and $50,000 will be
				  excluded.
(B) If B or C dies first,
				  at the date of the death $75,000 will be excluded from the law, and $25,000
				  will be subject thereto. If thereafter the tenancy continues in existence until
				  the death of the survivor of B or C, at the date of such death $37,500 will be
				  subject to the law, and $62,500 will be excluded.
(C) If B predeceases A and C, and A
				  predeceases C, the tenancy continuing in existence until A's death, at B's
				  death the property will be subject to or excluded from the law in accordance
				  with paragraph (B) of this example. At A's death $62,500 will be subject to the
				  law, and $37,500 will be excluded.
NOTE: Reference: Section
					 13671,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.3 - Joint Tenancies › Section 13671.2 - U.S. Savings Bond Purchased in Two Names

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
United States savings bonds may be purchased in two names,
					 i.e., payable to one person or another. The provisions of the Inheritance Tax
					 Law relating to joint tenancy property are applicable to such bonds. (See
					 Sections
					 13671
					 and 13671.50).
NOTE: As to the taxation of United States savings bonds
					 "payable on death" of one person to another, see Section
					 13648.2.
NOTE: Reference: Section
					 13671, Revenue and Taxation
					 Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.3 - Joint Tenancies › Section 13671.3 - Joint Trustee Accounts of Husband and Wife

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Where a husband and wife deposit funds in a bank or savings
					 and loan account as joint trustees, revocable by either and payable to either
					 or the survivor, the account shall be treated in the same manner as a joint
					 tenancy account upon the death of the first to die of said joint trustees. For
					 example, assume that funds of A and B, husband and wife, are deposited in a
					 bank or savings and loan account titled "A and B as joint trustees for C." The
					 account is revocable by either A or B, can be drawn on by either and upon the
					 death of either the account s payable to the surviving joint trustee. Upon
					 death of A, the account becomes the property of B with continued right to
					 revoke or withdraw. C has only a contingent interest in the account in the
					 event B does not revoke or withdraw during lifetime. Hence, as between A and B
					 the account is recognized for inheritance tax purposes to have the same effect
					 as a joint tenancy account. If the account is still in existence at the death
					 of B, the payment of the funds to C will be treated as a transfer from B to
					 C.
NOTE: Reference: Section
					 13671,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.3 - Joint Tenancies › Section 13671.50 - Conversion of Community Property into Joint Tenancy Between Husband and Wife

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
If community property is converted by the spouses into
					 their joint tenancy property, and the tenancy is thereafter maintained, upon
					 the death of either spouse the property is treated as community property for
					 inheritance tax purposes.
NOTE: As to conversion of community property into joint
					 tenancy of spouses and third person, see Section
					 13554.
NOTE: Reference: Section
					 13671.5,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.4 - Powers of Appointment › Section 13692 - Powers of Appointment-in General

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
A transfer subject to inheritance tax includes the value of
					 property in respect of which the decedent by taxable inter vivos gift or by
					 transfer at death created, possessed, exercised or released certain powers of
					 appointment. A power may be generally defined as a power or authority given (by
					 a donor, creator of the power) to a person (donee of the power) to designate
					 the person or persons (appointees under the exercise of the power) who shall
					 own, possess or enjoy the property or interest therein. If the donee of the
					 power does not exercise the power the persons who otherwise receive the
					 property or interest therein are generally termed the "takers in default" of
					 the exercise of the power. In general, the creation or gift of the power is a
					 taxable transfer from the donor to the donee of the power and the exercise or
					 nonexercise of a general power is a taxable transfer from the donee to the
					 appointees or takers in default. With certain exceptions (see Revenue and
					 Taxation Code Section
					 13695
					 and Section
					 13693 of this Article) the
					 exercise or nonexercise of limited powers by a donee is not taxable.
NOTE: Rules of general application are contained in Section
					 13692.1.
As to rules applicable to general powers of appointment
					 possessed by a deceased donee whose death occurred on or after September 17,
					 1965, see Sections
					 13696 and
					 13697.
For rules applicable to the creation of powers of
					 appointment see Section
					 13694.
Special provisions regarding limited powers of appointment
					 are dealt with in Section
					 13693.
For treatment of limited powers of appointment exempted as
					 being for charitable purposes see Revenue and Taxation Code Sections
					 13699
					 through
					 13701.
As to computation of the tax where a person receives both
					 an independent transfer and a power of appointment, see Sections
					 13408.1 and
					 13801.3.
NOTE: Reference: Section
					 13692,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.4 - Powers of Appointment › Section 13692.2 - Definition of "General Power of Appointment."

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) The term "general power of appointment"
				  as defined in Revenue and Taxation Code Section
				  13692
				  means any power of appointment exercisable in favor of the donee, his estate,
				  his creditors or the creditors of his estate, except
(1) a power limited to an ascertainable
				  standard as described in Section
				  13692.3 and Revenue and Taxation
				  Code Section
				  13692(a),
(2) a power exercisable by the donee only in
				  conjunction with the creator of the power (see Section
				  13692.4 and Revenue and Taxation
				  Code Section
				  13692(b)),
				  and
(3) a power exercisable by the
				  donee only in conjunction with a person having a substantial interest in the
				  property subject to the power, which is adverse to the exercise thereof in
				  favor of the donee (see Section
				  13692.5 and Revenue and Taxation
				  Code Section
				  13692(c)).
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.4 - Powers of Appointment › Section 13692.3 - Powers Limited by an Ascertainable Standard

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
A power to consume, invade or appropriate income or corpus,
					 or both, for the benefit of the donee, which is limited by an ascertainable
					 standard relating to the health, education, support or maintenance of the donee
					 is by reason of Revenue and Taxation Code Subsection
					 13692(a)
					 not a general power of appointment. A power is limited by such a standard if
					 the extent of the donee's duty to exercise and not to exercise the power is
					 reasonably measurable in terms of his needs for health, education or support
					 (or any combination of them). As used in this subparagraph, the words "support"
					 and "maintenance" are synonymous and their meaning is not limited to the bare
					 necessities of life. A power to use property for the "comfort, welfare or
					 happiness," or for "comfort and well-being," "benefit," "welfare and
					 well-being," "care, comfort and enjoyment," of the donee of the power are not
					 limited by the requisite standard. Examples of powers which are limited by the
					 requisite standard are powers exercisable for the donee's "support," "support
					 in reasonable comfort," "maintenance in health and reasonable comfort,"
					 "support in his accustomed manner of living," "education, including college and
					 professional education," "health" and "medical, dental, hospital and nursing
					 expenses and expenses of invalidism." In determining whether a power is limited
					 by an ascertainable standard, it is immaterial whether the beneficiary is
					 required to exhaust his other income before the power can be exercised.
NOTE: Reference: Section
					 13692, Revenue and Taxation
					 Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.4 - Powers of Appointment › Section 13692.4 - Powers Joint with Creator of Power

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Excepted from the definition of a general power of
					 appointment is a power not exercisable by the donee of the power except in
					 conjunction with the creator of the power. Transfer of property made subject to
					 such a power is treated as a transfer by the creator of the power, taxability
					 being determinable under Revenue and Taxation Code Sections
					 13641-
					 13648.
NOTE: Reference: Section
					 13692,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.4 - Powers of Appointment › Section 13692.6 - Joint Powers Allocated to Fractional Portions of Property

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
A power which is exercisable only in conjunction with
					 another person, and which after application of the rules set forth in Sections
					 13692.4
					 and 13692.5, above, constitutes a general power of appointment will be treated
					 as though the holders of the power who are permissible appointees of the
					 property were joint owners of property subject to the power. The donee under
					 this rule will be treated as possessed of a general power of appointment over
					 an aliquot share of the property to be determined with reference to the number
					 of joint holders, including the donee, who (or whose estates or creditors) are
					 permissible appointees. Thus, for example, if X, Y and Z hold an unlimited
					 power jointly to appoint among a group of persons, including themselves, but on
					 the death of X the power does not pass to Y and Z jointly, then Y and Z are not
					 considered to have interests adverse to the exercise of the power in favor of
					 X. In this case X is considered to possess a general power of appointment as to
					 one-third of the property subject to the power.
NOTE: Reference: Section
					 13692, Revenue and Taxation
					 Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.4 - Powers of Appointment › Section 13693 - Limited Powers of Appointment

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) Definition of "Limited Power of
				  Appointment."
A limited power of appointment is defined in Revenue and
					 Taxation Code Section
					 13693
					 as a power which does not qualify under Revenue and Taxation Code Section
					 13692
					 as a general power of appointment, i.e., a power under which a donee may not
					 appoint to himself, his estate, his creditors or the creditors of his estate.
					 For example, a limited power of appointment would include a power to appoint
					 only to or among specified persons or designated classes of persons, not
					 including the donee holder of the power, nor his estate, his creditors or
					 creditors of his estate. A power of appointment may be general as to part of
					 the appointive property and limited as to the rest. Thus, where the donor of
					 the power transfers property to a donee for life and at the donee's death to be
					 distributed, one-half to X, Y or Z as the donee by will directs, and one-half
					 to any person as the donee may so direct, the donee has a limited power of
					 appointment as to one-half and a general power as to the other
					 half.
(b) Gifts of Limited
				  Powers.
Under Revenue and Taxation Code Section
					 13694,
					 a gift of a power of appointment is taxable to the donee of the power, no
					 distinction being made between general or limited powers for this purpose (See
					 Section 13694).
(c) Exercise of Limited Power of Appointment.
Except as hereafter indicated, the exercise or nonexercise
					 of a limited power of appointment by a donee of the power is not taxable for
					 inheritance tax purposes. An exception is made where the donor created the
					 power in conjunction with a disposition of property effected before 5:00 p.m.
					 of June 25, 1935 and died prior thereto. In such case the exercise thereafter
					 by the donee of said power is taxed as a transfer from the donee to the person
					 or persons appointed pursuant to the exercise. For this purpose only the
					 exercise is taxable under Revenue and Taxation Code Section
					 13695.
					 If such a limited power is not exercised it is not treated as a taxable
					 transfer from the donee. The gift or creation of a limited power is taxable at
					 the death of the donor as indicated under paragraph (b) above.
NOTE: Reference: Section
					 13693,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.5 - Insurance › Section 13722 - Insurance Payable to Estate

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
All proceeds of a life or accident insurance policy which
					 are payable on the death of the insured to his estate, executor, or
					 administrator, or which in fact are receivable by or for the benefit of the
					 insured's estate are subject to the Inheritance Tax Law, except proceeds of any
					 federal war risk insurance of any veteran of World War I or World War II (see
					 Revenue and Taxation Code Section
					 13861)
					 and except for proceeds of any National Service Life Insurance or Servicemen's
					 Group Life Insurance Policy of any veteran of the Vietnam Conflict exempt under
					 the provisions of Revenue and Taxation Code Section
					 13861.5.
All proceeds of any policy similar to the type mentioned in
					 the preceding paragraph which are payable to a testamentary trustee or to a
					 trustee who is under a legal obligation to use the funds to meet taxes,
					 charges, debts, or expenses legally enforceable against the insured's estate
					 are subject to the Inheritance Tax Law. So also are proceeds of similar
					 insurance taken out by an insured in favor of a named person or corporation as
					 collateral security for a loan or other accommodation, the proceeds in such
					 case being considered as receivable for the benefit of the insured's
					 estate.
NOTE: As to the valuation of insurance, see Section
					 13951.9.
As to taxation of annuity contracts, see Sections
					 13644.1,
					 13648 and
					 13648.1.
As to withholding and notice requirements prior to delivery
					 of insurance proceeds by insurance companies and issuance of consents to
					 delivery such proceeds, see Sections
					 14345 and
					 14345.1.
NOTE: Reference: Section
					 13722,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.5 - Insurance › Section 13723 - Insurance Payable to Named Beneficiaries

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The first $50,000 of proceeds of any life or accident
					 insurance policy, as to which the insured until his death retained the legal
					 incidents of ownership (as, for example, the right to change the beneficiary,
					 the right to surrender, cancel, or assign the policy, the right to pledge the
					 policy for a loan, or the right to obtain from the insurer a loan against the
					 surrender value of the policy), which are payable on the death of the insured
					 to a beneficiary other than the insured's estate, executor, or administrator,
					 and which are not receivable by or for the benefit of the insured's estate, are
					 exempt from the Inheritance Tax Law, any excess over $50,000 being subject
					 thereto. Whether the insured has more than one such policy or names more than
					 one beneficiary therein, only $50,000 of the aggregate proceeds are exempt. If
					 more than one beneficiary is named in one or several policies, the total amount
					 of the exempt proceeds is prorated among the several beneficiaries in
					 proportion to the amount of insurance payable to each. For example, if a
					 decedent leaves life insurance to A in the amount of $10,000, to B in the
					 amount of $40,000, and to C in the amount of $50,000, the beneficiaries should
					 be entitled to the following exemptions: A, $5,000; B, $20,000; C,
					 $25,000.
All proceeds of any policy similar to the type mentioned in
					 the preceding paragraph, as to which the insured at his death had none of the
					 legal incidents of ownership, are exempt from the law, unless the insured
					 during his lifetime had assigned or transferred the policy in conformity with
					 Revenue and Taxation Code Section
					 13641
					 in contemplation of death, in which case only $50,000 of the proceeds are
					 exempt.
NOTE: As to valuation of insurance, see Section
					 13951.9.
As to taxation of annuity contracts, see Sections
					 13644.1,
					 13648 and
					 13648.1.
As to withholding and notice requirements prior to delivery
					 of insurance proceeds by insurance companies and issuance of consents to
					 deliver such proceeds, see Sections
					 14345 and
					 14345.1.
NOTE: Reference: Section
					 13723,
					 Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.5 - Insurance › Section 13724 - Insurance Paid from Community Funds, Date of Death Prior to January 1, 1981

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
If all the premiums on a policy of insurance issued on the
					 life of a deceased spouse and payable to the surviving spouse have been paid
					 from their community funds, and the decedent retained the legal incidents of
					 ownership in the policy until death, one-half of the proceeds of the policy is
					 excluded as community property belonging to the surviving spouse (see Revenue
					 and Taxation Code Section
					 13551
					 as amended and effective January 1, 1976), and in addition, $50,000 of the
					 decedent's one-half are excluded under the insurance exclusion (see Section
					 13723). This regulation may be
					 illustrated by the following example:
EXAMPLE. A at his death in 1976 left a $200,000 insurance
					 policy on his life payable to his wife, B, the premiums on which were paid from
					 community funds, and as to which the legal incidents of ownership were retained
					 by A until his death. B will be entitled to exclusions totalling $150,000, of
					 which $100,000 is within the community exclusion and $50,000 within the
					 insurance exclusion.
1. Amendment
					 of section title filed 7-2-81; effective thirtieth day thereafter (Register 81,
					 No. 27).
Note: Authority cited: Section
						14740,
						Revenue and Taxation Code. Reference: Section
						13724,
						Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.5 - Insurance › Section 13724.2 - Insurance Paid from Separate Funds, Date of Death Prior to January 1, 1981

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
If all the premiums on a policy of insurance issued upon
					 the life of a husband or wife and payable to the surviving spouse have been
					 paid from the insured's separate funds, and the insured had retained the legal
					 incidents of ownership in the policy until death, $50,000 of the proceeds of
					 the policy are excluded by reason of the insurance exclusion (see Section
					 13723) and the proceeds, being
					 separate property of the decedent, are also included in computing the surviving
					 spouse's marital exemption under Revenue and Taxation Code Section
					 13805
					 as it applies to decedents dying prior to January 1, 1976, and to the marital
					 exclusion under the amendment to Revenue and Taxation Code Section
					 13805,
					 effective as to decedents dying on or after January 1, 1976 (see Section
					 13805). However, in calculating
					 the one-half of the clear market value of the decedent's separate property
					 (factor (1)) for the purpose of determining the maximum marital exemption or
					 exclusion to which the spouse is entitled, the amount of the insurance proceeds
					 must be reduced by the $50,000 insurance exclusion.
This regulation may be illustrated by the following
					 example:
EXAMPLE. A at his death in 1976 left a $200,000 insurance
					 policy on his life payable to his wife, B, the premiums on which were paid from
					 A's separate funds, and as to which the legal incidents of ownership were
					 retained by A until his death. In addition A left other separate property
					 having a value of $100,000 all of which he left to B. B would be entitled to
					 the $50,000 insurance exclusion and a marital exemption or exclusion in the sum
					 of $125,000. The marital exemption or exclusion is computed as follows:
(1) One-half the net value of decedent's
				  separate property:
$200,000
Insurance proceeds
50,000
Less
							 insurance exclusion
$150,000
100,000
Other
							 separate property
$250,000
$250,000
=
							 $125,000
2
(2)
				  Amount of property received by wife which is not exempt:
$200,000
Insurance proceeds
100,000
Other
							 separate property
$300,000
Total received by wife
50,000
Less
							 insurance exclusion
$250,000
Factor (1) is lower, so $125,000 is the marital exemption
					 or exclusion.
1. Amendment
					 of section title 7-2-81; effective thirtieth day thereafter (Register 81, No.
					 27).
Note: Authority cited: Section
						14740,
						Revenue and Taxation Code. Reference: Section
						13724,
						Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.5 - Insurance › Section 13724.3 - Insurance Payable to Spouse, Date of Death on or After January 1, 1981

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Proceeds of insurance payable to the spouse of a decedent
					 dying on or after January 1, 1981 are within the spousal exclusion provided by
					 Revenue and Taxation Code Section
					 13805
					 as amended and effective January 1, 1981. Where a decedent with a date of death
					 on or after January 1, 1981 leaves insurance payable to the spouse and other
					 named beneficiaries, the full amount of the insurance exclusion is prorated
					 among the several beneficiaries other than the spouse in proportion to the
					 amount of insurance payable to each. For example, if a decedent leaves life
					 insurance to his wife (W) in the amount of $100,000, to his son (S) in the
					 amount of $50,000, and to his daughter (D) in the amount of $50,000, the
					 $100,000 proceeds payable to W is within the spousal exclusion provided by
					 Revenue and Taxation Code Section
					 13805
					 and the insurance exclusion is applied to the proceeds payable to D and S. In
					 such a case, D and S would each be entitled to a $25,000 insurance
					 exclusion.
1. Repealer
					 and new section filed 7-2-81; effective thirtieth day thereafter (Register 81,
					 No. 27).
Note: Authority cited: Section
						14740,
						Revenue and Taxation Code. Reference: Sections
						13724
						and
						13805,
						Revenue and Taxation Code.
California Code of Regulations › Title 18 - Public Revenues › Division 2.5 - State Controller › Chapter 1 - Inheritance Tax › Article 4.5 - Insurance › Section 13724.4 - Proceeds of Life Insurance on Prior Decedent Payable to Present Decedent

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) Present
				  Decedent Selected Mode of Settlement. If the proceeds of a policy of insurance
				  issued upon the life of a prior decedent is being paid in installments or
				  otherwise to a present decedent and the mode of settlement was selected by the
				  present decedent, the balance due on the policy is subject to the Inheritance
				  Tax Law and the insurance exemption is not applicable.
(b) Prior Decedent Selected Mode of
				  Settlement If the proceeds of a policy of insurance issued upon the life of a
				  prior decedent are being paid in installments or otherwise to a present
				  decedent and the mode of settlement was selected by the prior decedent, the
				  balance due on the policy is not subject to the Inheritance Tax Law.
1. New
					 section filed 7-2-81; effective thirtieth day thereafter (Register 81, No.
					 27).
Note: Authority cited: Section
						14740,
						Revenue and Taxation Code. Reference: Section
						13724,
						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 - Specific Exemption-in General

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
A transferee is entitled to one specific or personal
					 exemption in respect to all property received by him from the transferor,
					 whether during life or at the death of the latter, pursuant to any transfer
					 subject to the Inheritance Tax Law. This exemption varies in amount in
					 accordance with the transferee's degree of relationship to the transferor, see
					 Revenue and Taxation Code Sections
					 13307
					 through
					 13310,
					 and Sections
					 13801
					 through 13804.
NOTE: As to the deduction of the specific exemption from
					 the lower tax rate brackets, see Section
					 13402.3.
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 13801.1 - Specific Exemption Applicable

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) Transfer by Will or Laws of Succession.
In the case of a transfer by will or pursuant to the laws
					 of succession, the specific exemption in effect at the date of the transferor's
					 death is the exemption applicable.
(b) Transfer Inter Vivos.
(1) On or After June 25, 1935.
In the case of a transfer during the life of the transferor
					 made on or after June 25, 1935 (the effective date of the Inheritance Tax Act
					 of 1935), the exemption in effect at the date of the transferor's death is the
					 exemption applicable.
(2)
				  Prior to June 25, 1935.
In the case of a transfer during the life of the transferor
					 made prior to June 25, 1935:
(A) The
				  exemption in effect at the date of the transfer is the exemption applicable, if
				  the transfer was complete (see Section
				  13304.1); or
(B) The exemption in effect at the date of
				  the transferor's death is the exemption applicable, if the transfer was
				  incomplete (see Section
				  13304.2).
NOTE: Reference: Section
					 13801,
					 Revenue and Taxation Code.