Court Opinion

ID: 4625826
Source: CourtListenerOpinion
Date Created: 2020-11-21 02:57:57.11124+00
Date Added: 2024-06-11T07:56:46.539106
License: Public Domain

AUGUSTUS P. LORING AND ADA DWYER RUSSELL, EXECUTORS, ESTATE OF AMY LOWELL, PETITIONERS, v. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT.Loring v. CommissionerDocket No. 39872.United States Board of Tax Appeals20 B.T.A. 440; 1930 BTA LEXIS 2122; July 31, 1930, Promulgated 1930 BTA LEXIS 2122">*2122  In the computation of the taxable estate of a decedent the full amount of charitable bequests is deductible without reducing such amount by a state inheritance tax which may be payable therefrom.  Francis R. Hines, Esq., for the petitioners.  Eugene G. Smith, Esq., for the respondent.  SEAWELL20 B.T.A. 440">*440  The Commissioner determined a deficiency in estate tax for 1925 of $1,743.27, against which, on account of the payment of a state inheritance tax, there is allowable a credit of 25 per centum thereof, leaving only $1,307.45 of said deficiency proposed for assessment.  The deficiency in controversy is due in part to the Commissioner's reducing the value of charitable bequests under the residuary clause of the decedent's will by $26,020.26, the amount of the Massachusetts inheritance tax paid.  The case is submitted on the pleadings.  FINDINGS OF FACT.  Amy Lowell died testate on May 12, 1925, being then a resident of Brookline, Norfolk County, Mass.The petitioners were on June 24, 1925, duly appointed executors of her estate and are now acting in such capacity.  The decedent by the terms of her will gave, bequeathed and devised the residue1930 BTA LEXIS 2122">*2123  of her estate to certain charitable or educational corporations.  Certain legacies and bequests made by the will were subject to Massachusetts inheritance tax and in due course the said Massachusetts inheritance tax was paid by the executors of the estate.  In the audit and review of the return filed for the estate the respondent determined that the value of the charitable bequests passing under the residuary clause of the will should be reduced by the amount of the Massachusetts inheritance tax, thus increasing the amount of the net estate and resulting in part in the alleged deficiency.  20 B.T.A. 440">*441  OPINION.  SEAWELL: The value of certain property in the estate that formed a part of the basis of the determination of the deficiency in tax is not controverted by the petitioners.  The sole question for our decision is, Did the respondent err in reducing the value of the charitable bequests by $26,020.26, paid as the Massachusetts inheritance tax?  The petitioners rely on and cite prior decisions of this Board and of the Federal courts to sustain their contention that the action of the Commissioner complained of was erroneous.  Counsel for the respondent at the hearing very1930 BTA LEXIS 2122">*2124  frankly and properly stated that the question in issue has in numerous cases been passed on by this Board.  We are of the opinion that counsel for petitioners is correct in his contention that the Commissioner committed error as indicated in the assignment of error.  On the authority of the following cases we so hold.  ; ; ; ; ; and . Judgment will be entered under Rule 50.STERNHAGEN dissents.