Court Opinion

ID: 8065288
Source: CourtListenerOpinion
Date Created: 2022-09-09 04:44:45.76606+00
Date Added: 2024-06-11T16:38:11.099784
License: Public Domain

Berger, J.
(concurring). To the reasons stated in the principal opinion in favor of affirmance, I desire to add another which appears to -me to be controlling. In making the appraisement of the clear market value of the Roebling estate the comptroller allowed no deduction for federal taxes levied against the net estate. The precise question to be decided is, Should the amount of the tax imposed by federal authority be *443deducted from the gross estate in ascertaining its'clear market value, subject to the transfer tax of this state? The act of congress provides that in fixing the net value of an estate, subject to the federal tax, there shall be deducted from the gross estate, inter aiia, “such amount for funeral expenses, administration, expenses, claims against the estate * * * and such other charges against the estate as are allowed by the laws of the jurisdiction * * * under which the estate is being administered.” The United States Circuit, Court of Appeals for the Third District, in Lederer v. Northern Trust Co. et al. (not yet reported), said that the federal tax relates not to an interest to which some person has succeeded by inheritance, bequest or devise, or to the interest of the deceased at his death, but to the transfer of that interest by devolution. The devolution thus referred to, of course, means that which the state by law permits, for, as to that matter, the state has the sovereign power, and in the case last cited the court laid down the rule that if the state tax is a charge against an estate, to he allowed to an executor or administrator in the settlement of the estate, then it is to be deducted by the federal officer from the gross estate before fixing a net estate as the basis for the assessment under the federal act. That is, if it is a charge against the estate the amount of the state transfer tax is to he deducted from the gross in ascertaining the net estate, subject to the federal assessment, but if the state tax is not a charge against the estate, but is against the inheritor or legatee, as a condition imposed by the state before devolution, then the state fax is, not to be deducted from the gross in ascertaining the net estate taxable under the federal »law. The difficulty until sustaining the action of the comptroller in fixing the not estate made subject to the Hew Jersey transfer statute is, that the latter does not impose a, charge against the estate, but against the beneficiaries either by will or because of intestacy. The first section of our act imposes a tax upon the transfer of property “to persons or1 corporations,” and it has been, held in this state that it is a transfer tax, “not a general charge against the estate but a charge upon the legacies.” *444Neilson v. Russell, 76 N. J. L. 657. Section 7 of the act 'requires the executor to deduct from'any legacy the transfer tax before paying it over to the legatee, but he' is not allowed any credit for such payments on final accounting except against the legatee. This court having determined that our statute does not impose the tax as a charge against the estate it is not, under the terms of the federal statute, to be deducted in ascertaining the net estate for federal taxation, and, therefore, the comptroller has no right, in ascertaining the clear market value, to refuse to allow the amount assessed by the officers of the federal government as a tax for death duties, because the net estate to be distributed is reduced to that extent.
Such tax would, apparently, under the federal statute, and the Leéerer case, supra, be deducted in fixing the net estate made subject to federal taxation, if the New Jersey statute made its transfer tax a charge against the estate payable out of the. residue of the estate, but that is not the present situation.
The judgment should be affirmed.
For affirmance on, opinion of Mr. Justice Swayze—The Chief ■ Justice, Swayze, Parker, Kaliscii, Heppeni-ieimer, Williams, JJ. 6.. .
For affirmance on opinion of Mr. Justice Bergen alone— Black, J. 1.
For affirmance on both opinions — Bergen, Minturn, White,. Taylor, Ackerson, JJ. 5.
For reversal—None.