Court Opinion

ID: 7812845
Source: CourtListenerOpinion
Date Created: 2022-09-07 17:14:47.957721+00
Date Added: 2024-06-11T16:30:31.279847
License: Public Domain

Hart, J., (dissenting). The constitutionality of a Federal inheritance tax is upheld in Knowlton v. Moore, 178 U. S. 41; the constitutionality of a Federal estate tax is established in New York Trust Co. v. Eisner, 256 U. S. 345. In the latter case it was expressly held that the rights of several States to regulate descents and distributions are not constitutionally interfered with by a Federal estate tax imposed by an act of Congress. It was also decided in that case that the tax in question imposed by Congress is an estate tax, and not a legacy or succession tax. We do not agree with the majority opinion that, because this construction has been placed upon the act of Congress by the Supreme Court of the United States, it results that the tax is a debt, and should not be considered by the court in allowing dower to the widow under our statute. The act of Congress takes no notice of the disposition made of the estate by the testator or by the law as to intestate property, and looks only to the net estate itself as defined by the act of Congress. The statute imposes the tax on the gross estate of the decedent, and it becomes a lien upon the whole estate, and -must be discharged by payment by the executor before the estate passes to the distributees, legatees, or the widow. It is levied on the estate in the hands of the executor or personal representative of the decedent, and, under the act of Congress, the United States is entitled to its share of the estate before the claims of the widow, heirs or devisees can. be satisfied. The latter take only such part of the decedent’s estate as remains after payment of the tax, which, as we have already seen, is levied upon the whole estate of the decedent. What passes to the widow, heirs or devisees, and to which they acquire title, is the portion of the estate remaining after the payment of the Federal estate tax. The act specifically provides for the payment of the tax by the executor. It provides that it is the purpose and intent of the act that the tax will be paid out of the estate before its distribution. The act further provides that, unless the tax is sooner paid in full, it shall be a lien for ten years upon the gross estate of the decedent, except that such part of the gross estate as is used for the payment of charges against the estate and expenses of its administration, allowed by any court having jurisdiction thereof, shall be divested of such lien. The executor must pay the tax out of the gross estate of the decedent, and the legatees and distributees of the estate get the remainder of the estate after deducting the amount of the tax. It is imposed before the estate reaches the legatees or distributees of the decedent, and it is a lien upon the gross estate. Therefore it seems a fair and just interpretation of the- statute to hold that the legatees and distributees of a decedent, including the widow, only get what is left of the estate after paying the tax. This is so because the act makes the tax a lien upon the whole estate, and there is nothing to distribute until after it is paid. Mr. Justice Smith concurs in the views herein expressed, and we therefore respectfully dissent from the majority opinion.