Opinion ID: 106702
Heading Depth: 2
Heading Rank: 2

Heading: Administration Expenses.

Text: The testator's will provided that administration expenses, as well as community debts, should be paid entirely out of his half of the community property. The administration expenses totalled $4,073. Under Texas law an allocable share of these costs was chargeable to the surviving spouse's community property. That allocable share was determined to be 35% or $1,426. The issue is whether the executors' payment of the costs attributable to the wife's property are deductible administration expenses . . . allowed by the law of the State under § 812 (b) (2). The interpretation of administration expenses under § 812 (b) (2) involves substantially the same considerations that determine the interpretation of claims against the estate under § 812 (b) (3). In both instances, the testator, by directing that payment be made of debts chargeable to another or to non-estate property, reduces his net estate and in effect confers a gift or bequest upon another. We believe that the provisions of § 812 (b), like those of § 812 (e) providing the marital deduction, must be read in light of the general policies of taxing the transmission of wealth at death and of equalizing the tax treatment of couples in common-law and in community property jurisdictions. We hold, therefore, that a deduction may not be allowed for administration costs chargeable to the surviving spouse's community property.