Inheritance tax

“ An inheritance tax is not one on property, but one on the succession; (2) the right to take property by devise or descent is the creature of the law, and not a natural right,-a privilege,-and therefore the authority which confers it may impose conditions upon it. From these principles it is deduced that the states may tax the privilege, discriminate between relatives, and between these and strangers, and grant exemptions, and are not precluded from this power by the provisions of the respective state constitutions requiring uniformity and equality of taxation. ”

“ If, in framing an inheritance tax law, Congress will bear in mind that the regulation of successions to the property of decedents is a matter solely within the jurisdiction of the states and ought not to be usurped by the federal government, the object of raising revenue alone may lead to fair and reasonable taxes levied impartially upon all who should be called upon to pay for the support and maintenance of the common government whose protection they enjoy. ”

“ This tax is imposed on those acquiring property by inheritance or will. It is often imposed simply for the revenue it brings in; for it is easy and cheap to collect, hard to evade and one of the least unpopular forms of taxation. In most countries some form of inheritance-tax exists, and in most of our states. A special form of the tax is called the collateral inheritance tax, which imposes a higher rate upon property that is willed to distant relatives or to strangers. ”

“ Having established, as it is contended, that by operation of law the property is transmitted immediately from the testator to the heirs, it is also contended that from the very definition of an inheritance tax none could be imposed on plaintiffs in error as legatees of Levy. ”

“ WE believe that great fortunes, even when accumulated by the man himself, are of limited benefit to the country, and that they are detrimental rather than beneficial when secured through inheritance. We therefore believe in a heavily progressive inheritance tax—a tax which shall bear very lightly on small or ordinary inheritances, but which shall bear very heavily upon all inheritances of colossal size. ”

“ The requirement that the federal estate tax shall not be deducted in fixing the state inheritance tax imposes a much larger proportionate tax on the succession to a residuum of a large estate than a smaller estate, although the residuary estate and the residuary legacy be equal in each instance. ”

“ For, after all, what is an inheritance tax but a debt exacted by the state for protection afforded during the lifetime of the decedent? It is often impracticable to secure from living persons their fair share of contribution to maintain the administration of the state, and such laws seem intended to enable to secure payment from the estate of the citizen when his final account is settled with the state. Nor can it be readily supposed that such obligations can be evaded or defeated by the particular form in which the property of the decedent was invested. ”

“ It long has been settled law that real property cannot be taxed, or made the basis of an inheritance tax, except by the state in which it is located. More recently it became settled that the same rule applies with respect to tangible personal property. And it now is established by the three cases last cited that certain specific kinds of intangibles, namely, bonds, notes, and credits, are subject to the imposition of an inheritance tax only by the domiciliary state ”

“ There should be a progressive inheritance tax on large fortunes. Industrial education should be encouraged. As far as possible we should lighten the burden of taxation on the small man. We should put a premium upon thrift, hard work, and business energy; but these qualities cease to be the main factors in accumulating a fortune long before that fortune reaches a point where it would be seriously affected by any inheritance tax such as I propose. It is eminently right that the Nation should fix the terms upon which the great fortunes are inherited. ”

“ But I feel that in the near future our national legislators should enact a law providing for a graduated inheritance tax by which a steadily increasing rate of duty should be put upon all moneys or other valuables coming by gift, bequest, or devise to any individual or corporation. It may be well to make the tax heavy in proportion as the individual benefited is remote of kin. In any event, in my judgment the pro rata of the tax should increase very heavily with the increase of the amount left to any one individual after a certain point has been reached. ”

“ Many benefits are claimed for the inheritance tax. It brings in a large revenue, and falls upon those who are best able to pay. The tax cannot be shifted and it cannot easily be evaded. It is easily assessed and collected, because all wills must pass through the probate court. It is held that the state has a social claim upon the property of an individual who has amassed wealth under the protection of its laws, and that this property ought not to be transferred intact to those who did not aid in its accumulation. ”

“ The inheritance tax, however, is both a far better method of taxation, and far more important for the purpose of having the fortunes of the country bear in proportion to their increase in size a corresponding increase and burden of taxation. The Government has the absolute right to decide as to the terms upon which a man shall receive a bequest or devise from another, and this point in the devolution of property is especially appropriate for the imposition of a tax. ”

“ It is true that the tax prohibited by the treaty is in terms a tax on property or on its removal, but it is also true that the modern conception of an inheritance tax as a tax on the privilege of transmitting or succeeding to property of a decedent, rather than on the property itself, was probably unknown to the draftsmen of article 7. But whatever, in point of present day legal theory, is the subject of the tax, it is the property transmitted which pays it, as the Iowa statute carefully provides. ”

“ We should tax the man who holds old things for a longer time than originally allotted.
Under the present estate and inheritance tax system, the State has to wait an indefinite period, and allow the owner of a building or commodity to keep on earning and adding more to his fortune until he dies, before it can collect its inheritance tax. ”

“ There are a number of other cases in the state courts, but they either involve questions of taxation under general laws imposing taxed upon real and personal property, not being special inheritance taxes, or the language of the particular statute is such as to create little doubt as to the intention of the legislature to tax or not to tax the particular inheritance in question. ”

“ In an analogous situation, Federal bonds exempt by statute from all taxation have been held subject to a Federal inheritance tax. [11] And State inheritance taxes can be measured by the value of Federal bonds exempted by statute from State taxation in any form. ”

“ The power of testamentary disposition and the privilege of inheritance being legitimate subjects of taxation, a State may apply its inheritance tax to either the transmission, or the exercise of the legal power of transmission, of property by will or descent, or to the legal privilege of taking property by devise or descent. ”

“ The privilege of acquiring property by such an instrument is as much dependent upon the law as that of acquiring property by inheritance, and transfers by deed to take effect at death have frequently been classed with death duties, legacy and inheritance taxes. Some statutes go further than that of New York, and tax gratuitous acquisitions under marriage settlements, trust conveyances, or other instruments where the transfer of property takes effect upon the death, not merely of the grantor, but of any person whomsoever. ”

“ The national government also levies an inheritance tax, the rate of the tax depending upon the value of the property inherited. These various taxes bring in between three and four billion dollars per year. ”

“ Let the State pass inheritance laws which shall require the division of great fortunes among the children of descendants, and shall not permit the multi-millionaire to leave his fortune in a mass. Make more drastic the rule against perpetuities which obtain at common law, and then impose a heavy graduated inheritance tax enabling the State to share largely in the proceeds of such large accumulations of wealth which would hardly have been brought about save under its protection and aid. ”

“ In other States the amount received by an heir under an agreement compromising a contest of his ancestor's will is considered to be received by virtue of his heirship and is subject to an inheritance tax unless the statute exempts him. ”

“ To this answer appellees interposed pleas that the inheritance tax demanded of them, insofar as it is measured by the interest of the widow in the community, is unconstitutional for want of the uniformity prescribed by § 8 of Article I of the Constitution, and is a denial of due process, in contravention of the Fifth Amendment, in that it taxes property not belonging to decedent and not acquired by appellees under the will. ”

“ A national progressive tax on inheritances and incomes as large as can he collected. A progressive tax on corporations. A heavy tax on expenditures involving waste and luxury. Inheritances and incomes should be taxed by the nation to prevent dodging if the taxes are local. No tax is good, but an inheritance tax is the least objectionable of all taxes. It taxes the dead or at all events those who have not had the property ”

“ No inheritance tax shall be charged, directly or indirectly, against any legacy or devise made according to law for the benefit of any institution or other body or any natural or corporate person whose property is exempt from taxation as hereinbefore mentioned in this section. ”

“ The form of inheritance tax that is exciting special interest at this time is one that charges a higher rate on larger fortunes, and has for its purpose not revenue only, but the diminution of large inherited fortunes. ”

“ If it be true that it is beyond the power of Congress to impose an inheritance tax because the descent of property is regulated by state statutes, it would be difficult to support its power to impose stamp taxes upon commercial and legal instruments, since the conveyance, regulation, and transmission of all property is governed by the laws of the several states. ”

“ Practical considerations of wisdom, convenience, and justice alike dictate the desirability of a uniform general rule confining the jurisdiction to impose death transfer taxes as to in tangibles to the state of the domicile; and these considerations are greatly fortified by the fact that a large majority of the states have adopted that rule by their reciprocal inheritance tax statutes. ”

“ Kohne, to recover the sum of $5,820.23, called a collateral-inheritance tax, assessed upon the personal estate of the testatrix. By the law of Pennsylvania, where the property of the deceased passes to his or her collateral heirs, or to strangers, either by the law concerning intestate estates, or by will, it is made subject to a specific taxation for the benefit of the State. This tax is five per centum on the clear value of the estate. ”

“ Roberts, "that from the dawn of civilization the wit of man has failed to discover a plan by which intangible personal property could be made to pay its share of taxation, and it will never be made to pay on the ordinary assessment plan." Besides the increase of taxes on corporations, the taxation of franchises, which has just been authorized, and a general revision and simplification of tax laws, it has been proposed that a graded inheritance tax be adopted. ”

“ Moreover, insofar as the inheritance tax is paid out of the surplus and trust funds held by the United States, there is a depletion of the corpus to which the United States holds legal title. Such depletion makes that much smaller the estate which the Government has seen fit to hold in trust for the decedent's heirs. If the estate is to be tapped repeatedly by Oklahoma until 1984 by the deaths of the various heirs, the result may be a substantial decrease in the amount then available for distribution. ”

“ At the present stage of the argument, no very elaborate justification can be necessary, either for the object proposed by a graduated inheritance tax, or for the use of precisely these means to attain it. The preservation intact of a fortune over a certain amount is not desirable either in the public or individual interest. ”

“ If a state inheritance law can validly impose a tax measured by the amount or value of the legacy, even if that amount includes United States bonds, the reasoning that justifies such a conclusion must, when applied to the case of a Federal inheritance law taxing the very same legacy, bring us to the same conclusion. ”

“ Be it enacted by the general assembly of the state of Louisiana, That there is now, and shall hereafter be, levied, solely for the support of the public schools, a tax upon all inheritances, legacies, and donations; provided, no direct inheritance or donation to an ascendant or descendant, below $10,000 in amount or value, shall be so taxed; a special inheritance tax of 3 per cent on direct inheritances or donations to ascendants or descendants, and 10 per cent for collateral inheritances and donations to collaterals or strangers ”