Court Opinion

ID: 3684611
Source: CourtListenerOpinion
Date Created: 2016-07-06 06:29:31.144642+00
Date Added: 2024-06-11T14:20:40.412755
License: Public Domain

If the mortgage had not been given to secure the note, it appears to be conceded that, as a debt of the decedent, the payment in question would normally be considered as a deductible item under R.C. 5731.16(A)(3). Must the result be different simply because the obligation was secured by a mortgage? Does the fact that R.C. 5731.16(A)(4) mentions the word "mortgage," but is not otherwise applicable to the facts of this case, somehow nullify R.C. 5731.16 (A)(3)?
It is suggested that these two subsections are applicable to two different situations. By their explicit terms, (A)(3) is applicable to debts of the decedent, while (A)(4) is applicable to debts chargeable to property which is to be part of a decedent's estate for tax purposes, but which are not debts of the decedent. A mechanic's lien or unassumed mortgage might reduce the actual value of a parcel of real estate owned by the decedent and be includible *Page 235 
for tax purposes, even though they were not personal obligations of the decedent. In the latter case, it would be unfair to tax the total value of the property without recognizing the reduction in value represented by the lien or mortgage, even though it is not a debt of the decedent. Hence, (A)(4) exists to provide a deduction for claims that are not personal debts of the decedent.
Thus, in my view, there is no conflict between the provisions in question. They apply to two different situations. I cannot agree that R.C. 5731.16(A)(3) no longer applies because R.C.5731.16 (A)(4) would apply if the facts were different.
Further, it should be noted that there is no double deduction potentiality in this case, as the money actually was paid out of the estate, and properly deductible under (A)(3). To the extent of such payment, there would not be a deduction available in any state under (A)(4), since the mortgage is no longer "unpaid," and the eligibility for an (A)(4) deduction is not determined "* * * as of the * * * decedent's death," as is the case in (A)(3). While the possibility of double deduction is no doubt undesirable, overzealousness in its avoidance would result in no deduction at all.