Estate of Stevens

Gehl, J.

At the time of his death Mr. Stevens was an officer and employee of the Milwaukee Boiler Manufacturing Company. After his death the company declared an employee *333bonus. On December 14, 1951, the company delivered to the executrix of his estate its check in the sum of $9,000 which is the amount of the bonus declared for him. There was no agreement, oral or written, by the terms of which the company had bound itself to pay the deceased any amount by way of bonus, but for several years and in each year prior to his death it had paid a bonus.

The amount of the bonus payment was not included in the inventory filed by the executrix. Upon the hearing for determination of inheritance tax the court by order entered on July 9, 1953, held the bonus taxable as a part of the assets of the estate and included the $9,000 as “property discovered after inventory filed” in the gross value of the estate. The executrix appeals and contends that the bonus payment is not a taxable transfer under Wisconsin inheritance-tax laws.

Sec. 72.01, Stats., provides:

“A tax shall be and is hereby imposed upon any transfer of property, real, personal, or mixed, or any interest therein, or income therefrom in trust or otherwise, to any person, association, or corporation [exceptions omitted], in the following cases, . . . :
“(1) While a resident of state. When the transfer is by will or by the intestate laws of this state from any person dying possessed of the property while a resident of the state.”
“It is a tax imposed on a transaction, the transaction being the passing of property from the dead to the living. It is not a tax upon the property itself, and, consequently, neither the property nor the value thereof necessarily and inherently constitutes the basis for the amount of the tax. . . . The transfer contemplated occurs at the instant of death.” Estate of Week, 169 Wis. 316, 318, 172 N. W. 732.

The tax, as the court says, is not levied upon the property itself. It does contemplate, however, that there is property which is transferred from a person by his death. When Mr. Stevens died he had no enforceable claim against the com*334pany. He had during his lifetime no more thán the hope, if entitled to that, that a bonus payment might be declared, and until declared there was no one in whom existed the right to require payment of any sum in the way of bonus. As respects the bonus he possessed nothing of value. He had no interest in anything of determinable value until the company obligated itself to pay. We have no difficulty in arriving at the conclusion that the court erred in its determination that the bonus payment is taxable for inheritance-tax purposes.

The other question raised upon this appeal concerns the deduction allowed on account of federal estate taxes paid. Sec. 72.01 (8), Stats., provides:

“The tax so imposed shall be upon the clear market value of such property at the rates hereinafter prescribed and only upon the excess of the exemptions hereinafter granted. Inheritance and estate taxes imposed by the government of the United States on property which is subject to the state inheritance tax, to the extent said federal taxes are computed on the value of the property for state inheritance-tax purposes, shall be deemed debts and shall be deducted in determining the value of the property transferred.”

The executrix contends that the deduction for federal estate taxes paid should be computed on an apportionment basis, upon the ratio of the gross taxable estate for Wisconsin purposes to the gross taxable estate for federal purposes. The court below held, and the attorney general contends, that the deduction allowed is not an apportioned amount of the federal estate taxes paid.

The federal estate tax is imposed upon the transfer of some items of property which are not included in those considered in the determination of the state inheritance tax. For example, there is in this estate $10,000 of life insurance which is subject to the federal tax but is not reached under our statute. The full value of all property held jointly by the deceased with another is under some circumstances included *335in the value of the estate under federal law; only one half of the value thereof is included in the determination of the Wisconsin inheritance tax.

The language contained in that portion of sec. 72.01 (8), Stats., which we have italicized, seems to us to be so clear as to leave no doubt as to its meaning. It is required, first, that for the deduction only the property which is reached by the State Inheritance Tax Law be considered, and, second, that the federal tax may be deducted only to the extent that it is computed upon the same values as are used for the determination of the state tax.

The executrix contends that the inequity of the construction contended for by the state is observable from the fact that a proportionate-ratio formula is applied in making adjustments in the credit for previously taxed property in sec. 72.045 (1), Stats., formerly sec. 72.04 (2), for the apportionment of the insurance exemption under sec. 72.01 (7) (b), and the estate-tax credit under sec. 72.50. There is another section in ch. 72, Stats., which directs the application of an apportionment formula in the determination of state inheritance tax. Sec. 72.04 (8) so requires in the case where a part of the decedent’s property is in Wisconsin, a part without. It is contended that it should be concluded from an analysis of these provisions that the apportionment formula is generally considered to be the fairer and more equitable manner of computation. It would seem that if the legislature had considered an apportionment formula for determining the allowable deduction for federal estate taxes more equitable it would have so provided as it did expressly in the other provisions to which the executrix refers, and in sec. 72.04 (8). It cannot be said that the language of sec. 72.01 (8) which does not provide for an apportionment basis should be given that effect when it appears that other provisions of the same chapter do so provide in express terms. Under those circumstances it must be assumed that the *336legislature deliberately omitted from the provisions of sec. 72.01 (8) the direction that an apportioned deduction be allowed for federal estate taxes paid.

The attorney general states, and the statement is not challenged, that since the enactment of sec. 72.01 (8), Stats., the tax department has consistently computed the deduction for federal estate taxes paid upon the basis applied in this case; that it has taken the amount of the Wisconsin estate subject to federal estate taxes and has computed the federal estate taxes upon that amount and allowed the result as the amount deductible in the computation of the state inheritance tax. Of course, the practice of the department does not require that we adopt its construction; we may, however, consider the acquiescence of the legislature in such construction during the period of about eight years since enactment of the statute. Estate of Week, supra. Aside from that fact, we consider the language unambiguous and that the court gave to it the correct construction.

By the Court. — That part of the order which determines that the bonus paid is to be considered a part of the assets of the estate is reversed. That part thereof which determines the amount of deduction allowable for federal estate taxes paid is affirmed.