Mary H. Kennedy died October 16, 1928, leaving a nonintervention will, in which Edwin S. Goodwin was named as executor. By the terms of
The inventory, filed on November 8, 1928, showed an estate value of $5,085.59. This included two parcels of real estate, one appraised at two hundred dollars and another at three hundred. Household goods were appraised at fifty dollars, and the remainder of the estate, designated as liquid assets without further detail, at $1,335.59.
The executor having failed to return any inheritance tax to the state of Washington, the supervisor of the inheritance tax and escheat division, by authority of the state tax commission, on April 23, 1935, filed in the probate proceeding his findings fixing the amount of tax due from the estate to the state of Washington. The net tax due, as computed by the supervisor, after the deduction of debts owing by the decedent prior to death, funeral expenses, and the expenses of administration, was found to be $348.11, being ten per cent of the amounts severally going to the beneficiaries under the will, who, as it appears, were strangers to the blood and whose shares were, therefore, chargeable at that rate.
Notice of the findings of the supervisor having been given as provided by law, Paul Eugene Goss and Martha A. Goss, his wife, filed their objection to the findings in so far as they purported to establish the amount of the inheritance tax as a charge and lien upon the property of the estate of Mary H. Kennedy. Their objection had particular relation to lots 41 and
They alleged that the deed from the executor contained the recital: “This sale of said premises is necessary in the process of settlement of the estate of said deceased,” and that the proceeds from the sale were in fact used to pay in part the expenses of the administration and claims filed against the estate. They alleged that the supervisor, by his findings, had assessed the whole of the tax against the assets of the estate and sought to impress the tax as so fixed by him as a lien against the real property purchased by them from the executor, whereas the tax due should be properly assessed against the beneficiaries of the estate, that is to say, one hundred dollars against the three legatees and the remainder of the tax, claimed by them to be $176.75, against E. S. Goodwin, the executor, as a residuary legatee.
A hearing was had before the court and testimony taken upon the findings of the supervisor and the objection thereto, and an order made sustaining the objection, finding the amount of tax due from the estate to be $338.41, and assessing it, one hundred dollars against the specific legatees and $238.41 against Goodwin, the residuary legatee. The court also ordered and decreed that the real property purchased by the objectors from the executor was free from any lien for inheritance tax due to the state. From this order, the supervisor of the inheritance tax and escheat division appealed, by notice in open court, embodied in the order.
The controlling statutory provision is Eem. Eev. Stat., §11201 [P. O. §7051], which reads:
“All property within the jurisdiction of this state, and any interest therein, whether belonging’ to the inhabitants of this state or not, and whether tangible or intangible, which shall pass by will or by the statutes of inheritances of this or any other state, or by deed, grant, sale or gift made in contemplation of the death of the grantor or donor, or by deed, grant or sale or gift made or intended to take effect in possession or in enjoyment after the death of the grantor or donor to any person in trust, or otherwise, shall, for the use of the state, be subject to a tax as provided for in section 11202, after the payment of all debts owing by the decedent at the time of his death, the local and state taxes due from the estate prior to his death, and a reasonable sum for funeral expenses, monument or crypt, court costs, including cost of appraisement made for the purpose of assessing the inheritance tax, the fees of executors, administrators or trustees, reasonable attorney’s fees, and family allowance not to exceed $1,000, and no other sum, but said debts shall not be deducted unless the same are allowed or established within the time provided by law, unless otherwise ordered by the judge or court of the proper county, and all administrators, executors and trustees, and any such grantee under a conveyance, and any such donee under a gift, made during the grantor’s or donor’s life, shall be respectively liable for all such taxes to be paid by them, with lawful in
This section was amended, by the addition of new matter about which we are not concerned here, by the 1935 session of the legislature. Laws of 1935, p. 768, § 104.
The supervisor relies upon the last sentence above quoted to sustain his contention that the inheritance tax remains a lien on the whole of the estate of the decedent until paid. The respondents contend, first, that the “estate” referred to is the net estate after allowable deductions for debts and expenses; and, secondly, that, since under the findings of the trial court the proceeds of the real estate purchased by the respondents were applied to the payment of deductible items of expense, this real estate was thereby discharged of the tax lien.
The respondents rest their contention upon the holding of this court that the inheritance tax is not an estate tax in the sense of a tax upon the corpus of the decedent’s estate, but, rather, a tax upon the right of succession. In re Corbin’s Estate, 107 Wash. 424, 181 Pac. 910, 7 A. L. R. 685. It is urged that, since this is so, the tax is only upon the property passing to the beneficiaries, and the tax being so limited, the lien of the tax is likewise limited to the property passing to the beneficiaries.
Without going further afield for authority, we think the reasoning and conclusion reached in In re Sherwood’s Estate, 122 Wash. 648, 211 Pac. 734, disposes of the question, adversely to respondents’ contention. The question in that case was whether an estate tax paid to the Federal government was a deductible expense, exempt from the state inheritance tax. After a thorough analysis of the theory underlying our in
“The state may, if it so chooses, take to itself the whole of such property, or it may take any part thereof less than the whole and direct the disposition of the remainder; and this without regard to the wishes or direction of the person who died possessed of it, and without regard to the claims of those to whom he has directed that it be given. Stated in another way, the state’s power over such property is plenary, and its right to direct its disposition unlimited. It follows from this that those claiming the property must find the foundation for their claim, in the laws of the state.' They can have no claim superior to that which such laws give them. . . .
“Counsel in their argument stress the words ‘All property . . . which shall pass,’ and argue therefrom that the words, of necessity, mean such property as passes to the devisees, legatees or heirs of a deceased person’s estate, and not such part of it as may be taken for other purposes. Attention is called, also, to the distinction between the various taxes levied on a decedent’s estate, and it is pointed out that our tax is an inheritance tax, as distinguished from a death duty or estate tax, such as is the tax levied by the Federal government. But we cannot think the argument conclusive. It will be observed that the provision is
Now, if the legislature may require, as a condition to the succession, that the beneficiaries pay a tax on that portion of the estate which does not pass but is consumed by chargeable expense, it may, upon the same consideration, provide that, notwithstanding the allowance of certain deductible expenses in the computation of the tax, the amount of the tax when ascertained shall be a lien on the whole of the estate. The question here is whether, by the quoted language of § 11201, the legislature has done so. In view of the unambiguous language of the final sentence, it would seem a work of supererogation to elaborate the discussion of the question or cite authorities.
This section as a whole concerns itself with the disposition of the aggregate property left by a decedent,
The judgment of the trial court is reversed.
Main, Tolman, and Blake, JJ., concur.
Beals, J., concurs in the result.