124 Misc. 672 | N.Y. Sur. Ct. | 1924
The questions arising upon this accounting are disposed of as follows:
The compensation of the executor, Joseph H. Fargis, as attorney, is fixed as set forth in the account,
The personal claim of Joseph F. Murphy, executor, is approved and allowed under the provisions of section 212 of the Surrogate’s Court Act at $2,481.04.
(1) A question has arisen as to the manner in which the transfer tax assessed against the brother of the decedent is charged. By paragraph 4 of the will the testator gave all the rest, residue and remainder of his estate to his trustees, and directed that out of
There was assessed as the transfer tax against the life interest of Joseph F. Murphy in this trust the sum of $4,112.09. The executors paid this amount out of the funds of the general estate, but it is now sought to charge that amount against the commissions payable to Joseph F. Murphy in his capacity as executor. On the other hand, Joseph F. Murphy contends that the amount of this tax should be paid out of the corpus of the trust fund, part of the income of which is payable to him. In my opinion this contention is correct and the tax cannot be deducted from income or from the commissions due him. This was the rule laid down in Matter of Tracy (179 N. Y. 501, 509) following Matter of Vanderbilt (172 id. 69). The gift of income under the terms of the will to Joseph F. Murphy is not an annuity, but is a stated payment of $1,000 per month out of the net income earned on the trust. (Matter of Kohler, 193 App. Div. 8, 12; revd., on other grounds, 231 N. Y. 353.) The authorities dealing with the method of amortizing the transfer tax against an annuitant are, therefore, not applicable to the present estate. (Matter of Fleischer, 125 Misc. 321.) The objection is sustained and the transfer tax of $4,112.09 is directed to be charged out of the corpus of the trust.
(2) The remaining question has to do with a substantially similar dispute as to the method of charging the transfer tax assessed and paid as against Rose Anna Murphy, the sister of the decedent. Under the will she received a legacy of $5,000. Under the will she also received the income of $500 per month under similar terms to the $1,000 directed to be paid monthly to John F. Murphy. The periodical payment to Rose Anna Murphy was to be paid out of the same trust fund as that to Joseph F. Murphy. The executors have deducted from her legacy of $5,000 the total tax assessed against both transfers to her. This was erroneous for the reasons given by me in discussing the tax against the transfer to Joseph. The tax against the life interest of Rose in the trust must be paid out of the corpus of the trust fund. (.Matter of Tracy, supra.) The order fixing tax, however, assessed the tax against
Submit decree accordingly.