*795 This proceeding was brought to redetermine a deficiency in the estate tax of the estate of W. C. Van Hoozer in the amount of $3,009.50, and includes interest, "ad valorem" and specific penalties. The alleged deficiency arises from the claim in abatement in the amount of $3,078.79, of which the sum of $69.29 was allowed by the respondent.
The petitioner alleges that the respondent erred in that (1) he failed to reduce the appraised value of the real estate from $117,161.50 to $78,850; (2) he refused to allow deductions for the support of dependents and for executrix's commissions in the amounts of $15,500 and $4,580, respectively; and (3) he understated by $46.14 the amount of tax and interest paid by the petitioner on March 13, 1926. The respondent's answer admits error in the last respect.
FINDINGS OF FACT.
W. C. Van Hoozer, a resident of Pauls Valley, Okla., died May 12, 1921. The petitioner, widow of decedent, was appointed executrix of his estate on or about May 31, 1921. On September 21, 1922, she filed her final account as such executrix before the County Court of Garvin County, Okla.*1789 Among the assets of the estate were twelve parcels of real estate valued at $117,161.50 as determined by three disinterested appraisers appointed by the court and verified by the executrix. in her report submitting her account the executrix ass erted that the valuation was too high, yet she made it the basis of her settlement for the purposes of accounting.
By order of the said court dated October 17, 1922, such final report was approved, the estate distributed in accordance with the decedent's will, the executrix discharged, and the administration closed. By the terms of the decedent's will the estate was vested in the petitioner *796 in trust for the benefit of herself and the two minor children of the decedent and herself.
The petitioner failed to file a return for estate-tax purposes as required by the statute. On June 11, 1924, the collector of internal revenue for the district of Oklahoma filed a return under section 3176, Revised Statutes, as amended by section 1317 of the Revenue Act of 1918. That return was approved by the Commissioner and a tax assessed thereon. In the return the said twelve parcels of real estate were included at the valuations given them*1790 in the appraisal filed by the petitioner with her final report as executrix. On October 28, 1925, the collector at Oklahoma City mailed the petitioner a notice and demand for the payment of the tax, interest and penalties as follows:
| Deficiency in estate tax | $2,311.25 |
| Interest on deficiency to 10/8/25 | 472.61 |
| Ad valorem penalty | 577.81 |
| Specific penalty | 1,000.00 |
| Total payment demanded | 4,361.67 |
On or about February 18, 1926, the petitioner filed a completed claim for abatement in the amount of $3,078.79. March 13, 1926, the petitioner paid the tax computed on the basis of the reappraised value of the estate, amounting to $1,048.61, together with interest to the date of payment in the amount of $280.41. The respondent allowed the claim in the amount of $69.29 and rejected it for $3,009.50.
November 27, 1925, petitioner filed a tentative claim for abatement of the total tax, interest and penalties. On December 19, 1925, the petitioner, as former executrix of the estate, sought to reopen the settlement of the estate before the County Court of Garvin County and filed the following motion:
Comes now Allie E. Van Hoozer, formerly executrix of the Estate of*1791 W. C. Van Hoozer and represents to the Court that because of the fact that the estate of W. C. Van Hoozer was appraised at least $35,000 in excess of its real value, she is required to pay an estate tax greater than it should be.
That a protest against the payment of an estate tax is being made at this time and that it is greatly to the benefit of said estate that a correct and proper valuation be placed on said property.
That prior to the closing of said estate it was not realized by this executrix that the excessive valuation would make any material difference and for that reason she did not take steps to reduce said estate to its correct valuation.
That if this estate is reopened for that purpose, petitioner will be able to show by competent testimony that said estate was appraised greatly in excess of the market value.
The petitioner further asserted "that in the real estate alone there is an excessive valuation of at least $35,000.00 and that as to the *797 personal property there is an excessive valuation the exact extent of which this petitioner is unable to name at this time."
On December 24, 1925, the court set aside its former order discharging the executrix. *1792 In its order the court stated:
Thereupon, came on to be heard the motion of the said executrix to correct and amend the valuation of the real estate shown in the inventory and introduced evidence of the correct valuation, and the court being well advised in the premises is of the opinion that the motion should prevail and so orders. The executrix having asked the court to find the values of the property as per item and the court having carefully examined the witnesses as to the value of each and every item or parcel of real estate shown in the inventory of the estate of deceased, as of the date of his death on the 12th day of May, 1921, finds as follows:
That the fair cash value of the property mentioned estimated at the price it would bring on the market at a voluntary sale as of May 12, 1921, the date of the death of W. C. Van Hoozer is as to items as follows: [There followed an itemized list of the twelve parcels of real estate, setting forth their inventory values, corrected values and the amount of the reduction.]
IT IS THEREFORE THE ORDER JUDGMENT AN DECREE of the court that the valuation of the above itemized property belonging to the estate of W. C. Van Hoozer, deceased, *1793 be and the same is corrected to read as above stated and shown and that the inventory and appraisement as filed in this case be and the same is so corrected and reformed as to reduce the total value of said property described from $117,161.50 to the total sum of $78,850.00 and the difference between the former appraised value and the present reduced value as corrected is the sum of $38,261.00.
On January 26, 1925, the petitioner filed a supplemental report claiming as an allowance "out of the funds of the said estate the sum of $15,500 for the maintenance of her family for the period of sixteen months and the further sum of $4,580 allowance to her as commissions." On February 5, 1928, the court granted both of the above allowances as proper charges against the estate, stating that the sum of $15,500 was a reasonable maintenance allowance, considering the volume of the estate, and that the sum of $4,580 was the compensation fixed by the statute and was reasonable for the services performed.
During the 16-month period between the date of the decedent's death and the filing of the petitioner's original final report as executrix the petitioner expended for the support of herself*1794 and her two minor daughters the following amounts:
1. $2,500 for the maintenance, education and support of the two daughters.
2. $2,600 for the operation and upkeep of the family automobile.
3. $80 per month, or a total of $1,280, for groceries and family supplies (not included in the first item above).
4. $3,000 for wearing apparel for herself and her two daughters.
When the petitioner filed her original final report on January 21, 1922, she was not aware that expenditures for the support and maintenance of herself and children should have been included therein. *798 Such expenditures were reasonable and in harmony with the manner in which the decedent and his family had lived. The commissions were reasonable.
The respondent determined the decedent's gross estate to be $206,049.26, with deductions of $70,227.15 (including the specific exemption of $50,000), resulting in a net estate of $135,822.11. In his deficiency letter the respondent asserted against the petitioner an "ad valorem" penalty of $554.11 provided by section 3176, Revised Statutes, and also included in his computation of the deficiency a specific penalty of $1,000.
OPINION.
*1795 VAN FOSSAN: The petitioner asserts as her first allegation of error that the respondent valued the real estate belonging to the estate of W. C. Van Hoozer at the figures contained in the original appraisement of the estate and refused to reduce the value of such property to the amounts contained in the order of the probate court dated December 24, 1925. Since this Board is not bound by the finding of the probate court as to an issue of fact (; ; ), this issue must be determined on the basis of all the evidence before us.
The court records showing the amount of the original appraisal and the later figures determined by the court are in evidence but no witnesses were presented in support of either. We have, therefore, no direct testimony by which to judge the relative correctness of the two appraisals. In this circumstance we must look to the circumstances under which they were made. The first appraisal was made in the ordinary course of administration of the estate and on its face purports to*1796 be a true and correct inventory of the estate of decedent with the appraised value of each item. The report was submitted by the executrix over her oath. Appended is the certificate of the three disinterested parties who made the appraisal and set down opposite each item "the value thereof in money as by us determined." The values so fixed and approved by the court were adopted by the respondent as the basis for the estate-tax return. Thereafter, the respondent determined the deficiency in taxes and fixed certain penalties. After respondent made a jeopardy assessment of the tax determined by him, petitioner filed a motion in the court of probate to reopen the estate in the form set out in our findings of fact. In due time the court entered an order reopening the estate and proceeded to find new values for certain items, resulting in a reduction of $38,261 in the total value of the estate. Thus we have two values fixed by the same court, one in ordinary course and the second after *799 the tax controversy arose, the latter contained in an order admittedly initiated for the purpose of defeating or reducing the estate tax.
The evidence before us is not sufficient to overcome*1797 the correctness of the respondent's determination on this issue. We have no primary evidence, no witness appeared who could testify to the in correctness of the first, or the correctness of the second appraisal. The proof by which the court was persuaded to lower the values originally fixed is not before us. We have, in short, nothing but two conflicting values of the same estate. The first, supported by the certificate of the appraisers, made in due course. The second, initiated by the desire to reduce taxes.
The burden of proving error rests on petitioner. If the evidence is in equipoise she fails. Certainly there is no clear preponderance either of evidence or of probabilities in her favor. The respondent's determination of value will not be disturbed.
Section 403(a)(1) of the Revenue Act of 1918, provides, in part, as follows:
That for the purpose of the tax the value of the net estate shall be determined -
(a) In the case of a resident, by deducting from the value of the gross estate -
(1) Such amounts for funeral expenses * * * and such amounts reasonably required and actually expended for the support during the settlement of the estate of those dependent*1798 upon the decedent, as are allowed by the laws of the jurisdiction, whether within or without the United States, under which the estate is being administered, but not including any income taxes upon income received after the death of the decedent, or any estate, succession, legacy, or inheritance taxes.
The amounts set forth in the findings of fact aggregating $9,380 were reasonably required and actually expended by the executrix for the support of herself and minor children during the settlement of the estate and were allowed by the probate court under the laws of the State of Oklahoma. Therefore, such amounts are proper deductions from the value of the gross estate of the decedent. .
The commissions due to the executrix for her services as such were not claimed in her original final report but were asked for in her supplemental report and were allowed by the order of the probate court dated February 5, 1926. The commissions allowed are within the limit prescribed in section 1323, Compiled Statutes of Oklahoma, 1921. They are reasonable and we are of the opinion that they should be allowed as deductions whether paid to*1799 the administratrix or not. ; ; ; Jessie Gair Sweeney,*800 ; .
Proper adjustment should be made to correct the error of $46.14 made by the respondent in crediting the amount paid on March 13, 1926, by the petitioner as tax and interest.
Reviewed by the Board.
Decision will be entered under Rule 50.
SMITH and LOVE dissent.