Court Opinion

ID: 8200398
Source: CourtListenerOpinion
Date Created: 2022-09-09 23:26:15.891275+00
Date Added: 2024-06-11T16:40:53.961653
License: Public Domain

*210bA motion for rehearing was granted on April 3, 1951, and oral argument set for April 16, 1951.
The following opinion was filed May 8, 1951:
Brown, J.
{on rehearing). Both appellant and respondent filed motions for rehearing and each of them insisted that because we had obviously misunderstood the term “impose” as applied to tax matters we had announced a rule for the applicability of reciprocal exemptions which was not in accord with the legislative purpose and which would destroy the tax exemption now accorded by other states to the devolution of the property of Wisconsin residents and would restore the double taxation which sec. 72.01 (9), Stats., aimed to prevent. We directed a reargument of the cause. It was there made clear to us that “impose” is not the equivalent of “collect” and that a tax is “imposed,” as that word is used in tax legislation and administration, if the bequest or inheritance is subject to taxation although in a given case it may be absolved from “payment” because it qualifies under some exemption. While the parties still differ concerning the Wisconsin taxability of the transfer here involved, they are agreed, and have convinced us, that the Kentucky tax has been imposed and it is irrelevant that Kentucky exempts the bequest from taxation because it goes to charity. Hence the statement in the opinion (258 Wis. 206, 210, 45 N. W. (2d) 678) “because the transfer of the stock to the trustee is a charitable trust, no tax has been imposed under the laws of Kentucky on that transfer” must be withdrawn, together with the conclusion which rests upon it.
Appellant has stated the issue thus:
“. . . whether or not reciprocity exists in this case, and in the companion case, depends . . . upon the broad question of whether the laws of the other states meet the requirement of a ‘like exemption’ as provided in sec. 72.01 (9), Stats., *210cwhen they do not go the entire way of exempting all property of a decedent resident in Wisconsin, but do require payment of a tax in some situations.”
If a Wisconsin resident died owning Kentucky corporate stock under the circumstances of this case, Kentucky would not have taxed the devolution of the property of the nonresident although it would have taxed it if the deceased resided in Kentucky. The Kentucky statutes, quoted ante p. 208, so state and the attorney general of Kentucky so advised the Wisconsin department of taxation.
Appellant submits that it is not enough for Kentucky to impose the tax and then grant an exemption which would save this transfer from tax if the deceased was a Wisconsin resident and the corporation’s domicile was Kentucky, and argues that because the statute defining the exemption differs from Wisconsin’s it is not a like exemption. In Estate of Uihlein (1945), 247 Wis. 476, 20 N. W. (2d) 120, the same appellant argued that the controlling purpose of the legislation (sec. 72.01 (9), Stats.) was to prevent the evil of double taxation which follows if both the state of domicile and the state of the situs impose a tax. We said then that a reciprocity statute is not like an offer of a contract to be accepted' in terms or not at all. The commissioners on uniform state laws have drafted a Reciprocal Transfer Tax Act to deal with this phase of inheritance-tax matters. It has been adopted, in general, by eighteen states, but 9 Uniform Laws Annotated, Miscellaneous Acts, p. 619, says: “While the state statutes listed in the table constitute substantial adoptions of the Uniform Reciprocal Transfer Tax Act, differences are so numerous that it is not feasible to point them out in detail.” Wisconsin is not even in the table as a state whose laws are even substantially like the model. If the legislature, as counsel said, (and as we believe) tried by sec. 72.01 (9), Stats., to save the estates of Wisconsin resi*210ddents from taxation elsewhere, we do not think it could have been so impractical as to require the states with whom it offers to co-operate to form their exemptions in the Wisconsin mould nor did it mean to refuse reciprocity on points of coincidence because some points of difference still remained. We consider that this state offered reciprocity if the state of a decedent’s residence would exempt from the tax a Wisconsin resident identically circumstanced. Kentucky’s laws have done so in this instance and thereby her resident is entitled to the benefit of our reciprocity statute.
The order of the learned county court must be affirmed.
By the Court. — The previous mandate is revoked. Order affirmed.
FRITZ, C. J., dissents on rehearing.