20 N.W.2d 120 | Wis. | 1945
Petition of Arthur H. Westphal, as special administrator of the estate of August E. Uihlein, of New York state, for determination of inheritance tax on transfer of property of said August E. Uihlein. From an order determining that no inheritance tax is payable upon the transfer involved, the state of Wisconsin appeals.
August E. Uihlein died testate May 21, 1939, in the city of New York. He had been beneficiary of an income from an inter vivos trust established by his father, a resident of Wisconsin, on April 29, 1908. The trust res consisted principally of stocks and bonds. A considerable amount was invested in Wisconsin corporations. The beneficiary was given a general power of appointment over the corpus of that trust. He failed to exercise the power and by the terms of the trust the corpus passed to his heirs at law. The lower court found as a conclusion of law that even if it is presumed that August E. Uihlein owned intangible property with a taxable situs in Wisconsin at the time of his death, the transfer of said property upon his death is not subject to inheritance tax in Wisconsin by virtue of the complementary reciprocal laws of Wisconsin and New York as provided by sec. 3, art. XVI, of the New York constitution, and sec.
New York, in her constitution, provided that intangible personal property within the state not employed in carrying on any business therein by the owner shall be deemed to be located at the domicile of the owner for purposes of taxation.
New York does not impose a tax on intangible property within the state belonging to a nonresident. It follows that residents of New York were then entitled to the benefit of our reciprocity statute in such circumstances.
The tax Wisconsin now seeks to impose would be on the transfer of the trust corpus by reason of the nonexercise of a power of appointment given to August E. Uihlein. Under sec.
August E. Uihlein's death was before the legislature sought to withdraw or limit the extension of the reciprocity statute by providing that that section "shall not apply unless a tax is imposed on the transfer of said property by the laws of the state, territory or district of residence." Sec. 1, ch. 280, Laws of 1945. At the time of the transfer the statute provided for its exclusion from taxation in this state when the state of domicile did not impose a tax upon such transfer affecting intangibles of a Wisconsin resident. The important facts are that August E. Uihlein was a nonresident donee-owner of a power of appointment. The state of his residence did not impose a tax on one who was a resident of Wisconsin and so circumstanced.
Since sec.
By the Court. — Order affirmed. *480