273 Mass. 208 | Mass. | 1930
This is a complaint under G. L. c. 62, § 47, against the defendant for refusal to abate an income tax levied under that chapter. The essential facts set forth in the complaint (which must be assumed to be true because the case comes before us by report after the overruling of a demurrer) are these: The petitioners are executors of the will of a testator who died on October 16, 1928; in the. tax levied upon the complainants for income received by them as such executors for the period from October 16, 1928, to December 31, 1928, there was included a tax at six per cent per annum upon moneys received by them as follows: (a) interest accrued to the date of the death of the testator upon bonds owned by him, taxable as income if actually received by him, collebted by them as and when the coupons matured; (b) dividends declared prior to October 16, 1928, to stockholders of record prior to. that date but payable after that date; (c) coupons which had become due and payable prior to October 16, 1928, which had not been detached from the bonds, and which were detached and cashed by the complainants after that date; (d) interest accrued ou a checking account paid to the complainants after October 16, 1928. Although not distinctly alleged that this interest had accrued prior to October 16, 1928, the argument has proceeded on the assumption that it had so accrued and we treat this item on
The relevant statutory provisions are these words of G. L. c. 62, § 1: “ Income of the classes described . . . received by any inhabitant of the commonwealth during the preceding calendar year, shall be taxed . . and of § 9 as amended by St. 1925, c. 242, § 1: “ The estates of deceased persons who last dwelt in the commonwealth shall be subject to the taxes imposed by this chapter upon all income received by such persons during their lifetime, if assessed . . . [as required]. The income received by the estates of such deceased persons shall be subject to all the taxes imposed by this chapter to the extent that the persons to whom such income is payable, or for whose benefit it is accumulated, are inhabitants of the commonwealth.”
It is within the competency of the General Court under the Forty-fourth Amendment to the Constitution to require taxation of the items here taxed. The word “income ” in that amendment is comprehensive in scope; it is not to be given a narrow meaning. Tax Commissioner v. Putnam, 227 Mass. 522, 526, 527. Raymer v. Tax Commissioner, 239 Mass. 410, 412. There is no constitutional difficulty in the way of a legislative provision that an executor or administrator'or other fiduciary shall for purposes of taxation be in the same position as the preceding owner. United States v. Phellis, 257 U. S. 156. Taft v. Bowers, 278 U. S. 470. That which in some aspects is capital may in other aspects be treated as taxable income by reason of separation in identity of owner and recipient. Irwin v. Gavit, 268 U. S. 161. The question to be decided is not one of legislative power but one of statutory construction. Income of the nature here in issue is plainly described as taxable in G. L. c. 62, § 1 (a) (b). But by § 9, as amended and already quoted, there is established a clear differentiation between natural persons and estates
If it had been the design of the Legislature to authorize the imposition of the tax here assailed, it would have been a simple matter to use words of unmistakable import to express that design. Such words are not found in the governing statutes. It is a familiar principle that doubts as to the extent of a tax law are resolved in favor of the taxpayer. Hill v. Treasurer & Receiver General, 229 Mass. 474, 475-476.
The conclusion here reached is in accord with decisions interpreting somewhat similar provisions of tax laws of other jurisdictions. Nichols v. United States, 64 Ct. of Cl. 241: certiorari denied, United States v. Nichols, 227 U. S. 584. See People v. Loughman, 226 App. Div. (N. Y.) 108; affirmed in 251 N. Y. 544.
Order overruling demurrer affirmed.