Court Opinion

ID: 6605688
Source: CourtListenerOpinion
Date Created: 2022-07-20 20:11:58.501132+00
Date Added: 2024-06-11T15:58:10.495396
License: Public Domain

RATLIFEF, Judge,
dissenting.
The statute relied upon by the majority, Indiana Code section 32-4-1.5-15, in holding that the entire tax refund check belonged to Alma Rubeck, is, in my opinion, inapplicable to this case. The tax refund check did not represent "personal property, other than an account, which is owned by two (2) or more persons." Alma Rubeck had no ownership interest. The mere act of filing a joint income tax return cannot be construed to create a joint tenancy in any tax refund which may be due thereunder. Graver v. Illinois Department of Public Aid (1978), 64 Ill.App.3d 820, 21 Ill.Dec. 597, 381 N.E.2d 1044; In re Estate of Trecker (1974), 62 Wis.2d 446, 215 N.W.2d 450.
In Duden v. United States (1972), 467 F.2d 924, 199 668 it was held that a wife had no property interest in a tax refund check made payable to husband and wife jointly where the husband was the sole producer of the income reported on the return. Further, it has been held that merely filing a joint federal income tax return does not vest in the wife any title to part of the tax refund, but rather, the court must look to the actual earnings and with-holdings to determine any apportionment of the refund. In re Carson (1964), 83 N.J.Super. 287, 199 A.2d 407. The Corson court found that under state personal property law, sole ownership of the refund rested in the deceased husband and his estate. Carson, 199 A.2d at 4109. See also, Annot. 67 A.L.R.3d 1038 et seq., where it is stated that in authorizing the filing of joint federal income tax returns, Congress did not intend to effect a change in the ownership of property rights of taxpayers, and that the filing of a joint tax return does not automatically convert the interest of one spouse in a refund due into a joint ownership with the other party to the marriage. 67 A.L.R.3d at 1038.
The question of the ownership of an income tax refund check issued jointly to a husband and wife as a result of their having filed a joint tax return is to be determined by state law. Graver, 21 Ill.Dec. at 599, 381 N.E.2d at 1046; Duden, 467 F.2d at 929; Carson, 199 A.2d at 408. Therefore, Indiana law governs determination of this issue. I agree with the majority in that respect. However, the majority cites no Indiana law which, in my opinion, leads to the result achieved by the majority opinion.
The refund check was not personal property owned by the husband and wife. Alma had no income whatever. All of the income reported on the tax return was generated by D. Eugene Rubeck, her deceased husband. Neither, in my opinion, is the refund check a promissory note, bond, certificate of title to a motor vehicle, or any other written instrument evidencing an interest in tangible or intangible personal property other than an account. The check in question is not within the purview of Indiana Code section 32-4-1.5-15. The majority's construction of that statute is strained. The case of Robison v. Fickle (1976), 167 Ind.App. 651, 340 N.E.2d 824, trans. denied, does not support the majority's interpretation here. Robison involved corporate stock certificates and bank certificates of deposit which bore the words "as joint tenants with full right of survivorship and not as tenants in common." Lester, Executor v. Lester (1974), 160 Ind.App. 671, 313 N.E.2d 357, involved promissory notes and a mortgage in the names of both husband and wife. Lester provides no support for the majority either. In both Robi-son and Lester, the instruments involved clearly were within those covered by the statute (Ind. Code see. 82-4-1.5-15). In addition, the language in Robison clearly indicated an intention to create a joint tenancy. No such relationship or tenancy is created by the mere act of filing a joint income tax return. Graver: Duden; Trecker; Carson.
Furthermore, the trial court specifically found that the D. Eugene Rubeck Estate probably was insolvent, a fact which the majority opinion chooses to ignore. What the majority opinion does is to allow Alma the entire $96,952.83 tax refunded at the expense of Eugene's creditors, a result *988which is manifestly unjust. By the simple act of filing a joint income tax return in order to avail themselves of the more favorable tax rates for such taxpayers, a joint tenancy was created in the refund check, if the majority opinion prevails, thereby enabling Alma to profit substantially at the expense of the creditors of an insolvent estate. Such a result is unjust and cannot be supported by applicable state law. Alma earned none of the income reported and upon which the tax was overpaid thereby generating the ultimate issuance, after Eugene's death, of the refund check. As a matter of fact, Alma does not even contend she paid any part of the tax payment with her own separate funds. On the facts of this case, the refund check should be apportioned in accordance with the proportionate income of the parties reflected on the tax return-in this case, one hundred per cent to Eugene and his estate.
The trial court properly decided this matter and the judgment should be affirmed. Therefore, I dissent.