donor, is considered to be a transfer by the donor of such income by gift. (69-1601)

Same. Where property is transferred for less than an adequate and full consideration, then the amount by which the value of the property exceeded the value of the consideration is deemed a gift, and is included in computing the amount of gifts made during the calendar year. If the gift is made in property, the value thereof at the date of the gift is considered the amount of the gift. (69–1603, 69-1606)

Net gifts. The term "net gifts" means the total amount of gifts made during the calendar year, less the deductions allowed. (69–1604) Exemptions. In computing net gifts for any year, there is allowed a specific exemption of $10,000, less the aggregate of the amounts claimed and allowed as specific exemption for preceding years; and the amount of all gifts made during the year to benevolent, charitable, educational, or religious institutions, fraternal societies, etc., organized or existing within this State and engaged herein and carrying out the objects and purposes for which organized; as well as all gifts to posts or organizations of war veterans, or auxiliaries, units, or societies thereof, existing in this State. Except as to gifts of future interests in property, the donor is entitled to exclude from the total amount of gifts made during the calendar year the first $5,000 of gifts made during each year to the donor's grandfather, grandmother, father, mother, husband, wife, child, stepchild, or any lineal descendant of donor, and to exclude the first $1,000 of gifts to each donee not so related to the donor. (69-1604, 69-1605)

Rates of tax. The tax for each year is an amount equal to the excess of: (1) A tax, computed in accordance with the rate schedule hereinafter set forth, on the aggregate sum of the net gifts for such calendar year and for each of the preceding calendar years, over (2) a tax, computed in accordance with the rate schedule, on the aggregate sum of the net gifts for each of the preceding calendar years. The rate schedule is as follows: (69–1602)

Filing returns. Each individual who, during any year, makes any transfers by gift, except gifts excluded, is required to make a return thereof to the State treasurer not later than February 1 following the close of the calendar year. (69–1607)

Payment of tax. This tax is paid by the donor to the State treasurer on or before February 1 following the close of the calendar year, although such treasurer may extend the time of payment for not exceeding 6 months from the date prescribed; if time for payment is extended, interest at the rate of 6 percent per annum is charged from the original due date until the expiration of such period of extension. (69–1609, 69–1618)

Tax lien. This tax is a lien upon all gifts made during the calendar year for 6 years from the time the gifts are made; and if the tax is not paid when due, the donee is personally liable to the extent of the value of the gift. (69-1610)

Disposition of proceeds. This tax is paid to the State treasurer and credited to the gift tax fund of the State; but whenever the amount in this fund exceeds $10,000, all in excess of $5,000 is transferred to the general fund of the State. (69-1601)

Administration of act.-The State treasurer administers and enforces the provisions of this act. (69-1625)

Sources of information.-Title 69, Chapter 16, Oregon Code Annotated, Supplement of 1935; Chapter 250, Session Laws of 1937.

PENNSYLVANIA

INHERITANCE AND ESTATE TAXES

Tax imposed. A tax is imposed upon the transfer of property, real or personal, or of any interest therein or income therefrom, in trust or otherwise, to persons or corporations, as shown below. (2301)

Transfers taxable.-The transfers taxable under this act include those made (a) when the transfer is by will or by the intestate laws of this Commonwealth from any person dying seized or possessed of the property while a resident of the Commonwealth whether the property is situated within this Commonwealth or elsewhere. (b) When the transfer is by will or intestate laws of real property within this Commonwealth, or of goods, wares, or merchandise within this Commonwealth or of shares of stock of corporations of this Commonwealth or of national banking associations located in this Commonwealth, and the decedent was a nonresident of the Commonwealth at the time of his death. (c) When the transfer is of property made by a resident, or is of real property within this Commonwealth, or of goods, wares, and merchandise within this Commonwealth, or of shares of stock of corporations of this Commonwealth, or of national banking associations located in this Commonwealth made by a nonresident, by deed, grant, bargain, sale, or gift, made in contemplation of the death of the grantor, vendor, or donor, or intended to take effect in possession or enjoyment at or after such death. (2301)

Same. When any person or corporation comes into the possession or enjoyment by a transfer from a resident or nonresident decedent, when such nonresident decedent's property consists of real property within this Commonwealth, or of shares of stock of corporations of this Commonwealth, or of national banking associations located within this Commonwealth, of an estate in expectancy which is contingent or defeasible, transferred by an instrument taking effect after the passage of this act, or of any property transferred pursuant to a power of appointment contained in any instrument taking effect after the passage of this act, such a transfer is taxable hereunder. The proceeds of policies of life insurance, payable otherwise than to the estate of the insured, and whether paid directly by the insurer to designated beneficiaries or to a designated trustee, and held, managed, and distributed by such trustee to or for the benefit of such persons or classes of persons under such plan and in such estates as may have been prescribed by the insured under agreement with such trustee, are not included in imposing any tax under this section. It is provided, however, that property transferred, pursuant to powers of appointment, shall in all cases where the power is hereafter exercised, be taxed as of the estate of the donor notwithstanding any blending of such property with the property of the donee. Personal property of a nonresident decedent made taxable under this paragraph is not subject to the tax if a like exemption is made by the laws of the State or country of the decedent's residence in favor of residents of this Commonwealth. (2301)

Same. Whenever any property, real or personal, is held in the joint names of two or more persons, except as tenants by the entirety,

or is deposited in joint names of two or more persons, except as husband and wife, so that upon the death of one of them the survivor or survivors have a right to the immediate ownership or possession and enjoyment of the whole property, the accrual of such right by the death of one of them is deemed a transfer taxable of a fractional portion of such property, to be determined by dividing the value of the whole property by the number of joint tenants existing immediately preceding the death of the deceased joint tenant. Subject to the provisions of (c) of the second preceding paragraph, the provisions of this paragraph apply regardless of when such joint estate was first created. (2301)

Additional estate tax.-An additional estate tax is imposed on all transfers, in trust or otherwise, of property taxable under the provisions of the inheritance tax law. This additional estate tax is in an amount equal to the difference between the total credit allowed under the Federal estate tax act 2 and the total taxes actually paid or payable to this Commonwealth and any other State or Territory under inheritance tax laws. This tax is payable in accordance with the provisions of the inheritance tax law. (2303)

Deductions allowed.-In ascertaining the clear value of an estate, the following deductions are allowed from the gross value of such estate: Debts of the dedecent; reasonable and customary funeral expenses; bequests or devises in trusts, in reasonable amounts, the entire interest or income from which is to be perpetually applied to the care and preservation of family burial lots, enclosures, and the structures erected on such lots; reasonable expenses for monuments or gravestones, grave and lot markers; and expenses of administration. No deductions are allowed for or on account of any taxes paid on such estates to the United States or to any other State or Territory, except as otherwise provided. (2302)

Exemptions. All estates in any buildings, ground, books, manuscripts, curios, pictures, statuary or other works of art, specimens of natural history, or other scientific collections, passing by will from a person seized or possessed thereof to any municipality, corporation, or unincorporated body, for the sole use of the public by way of free exhibition within this State, in trust or otherwise, are not subject to any tax under this act. (2483)

Same.-Section 471 of Title 20 of the statutes grants to the widow, or if there be no widow, or if she has forfeited her rights, to decedent's children, real or personal property, or the proceeds therefrom, to the value of $500, belonging to the estate of any decedent dying, testate or intestate, within this Commonwealth, or dying outside of this Commonwealth, but whose estate is settled in this Commonwealth.

Classification of beneficiaries.-The beneficiaries under this act are classified as follows: Class A: Father, mother, husband, wife, children, lineal descendents born in lawful wedlock, legally adopted children, children of a former husband or wife, and wife or widow of a son. Class B: All other persons, bodies politic or corporate. Property passing from the mother of an illegitimate child, or from any person of whom the mother is a lineal descendent, to such child, his wife or widow, and passing from an illegitimate child to his mother, is taxed at the same rate as other transfers to beneficiaries of class A. (2302)

The provisions of law relating to this tax are shown on p. 7.

Rates of tax.-Transfers to beneficiaries of class A are taxed at the rate of 2 percent of the clear value of the property transferred; beneficiaries of classs B, 10 percent. (2302)

Filing returns. Returns are required to be filed, in the office of the register of wills of the proper county, by executors, administrators, grantees and others, within 3 months after the death of a resident decedent or within 3 months after acquiring interest in any property subject to this tax. (2351)

Payment of tax; discount; interest. This tax is payable to the registers of wills of the several counties, and if paid within 3 months after the death of the decedent, a discount of 5 percent is allowed; if not paid within 1 year after such death, interest is charged at the rate of 12 percent per annum. If the estate or any part thereof cannot be settled within 1 year, interest is charged at the rate of 6 percent per annum from the end of the year until there is a default. Where real or personal estate withheld by reason of litigation or other cause of delay from the parties entitled thereto has not been productive to the extent of 6 percent per annum, the proper parties are not required to pay a greater sum to the Commonwealth than they have realized or shall realize from such estate during the time the same was withheld. Taxes payable on account of the transfer of property of a nonresident decedent are collected by the department of revenue. (2381, 2412, 2442)

Taxes due other States.-Executors and administrators of estates of nonresident decedents are required to file proof, within 12 months after qualifying, that all death taxes, with penalties and interest thereon, due the decedent's State of domicile, have been paid or secured, or that none is due thereto, unless letters have been issued in such State of domicile. This provision applies, however, only in the event the laws of decedent's State or foreign country of domicile contain a similar provision whereby this Commonwealth is given reasonable assurance of the collection of its death taxes, interest, and penalties from the estates of decedents dying domiciled in this Commonwealth, and the estates are being administered in such other State, or if the State of domicile does not grant letters in nonresident estates until after letters have been issued by the State of domicile. (2432, 2435)

Tax lien. The lien of all taxes imposed by this act continues until the tax is settled, and is limited to the property chargeable therewith. (2443)

Disposition of proceeds. The proceeds of this tax are for the use of the Commonwealth.

(2302)

Administration of act.-The department of revenue is authorized to adopt and enforce rules and regulations for the administration of this act.

Sources of information.-Title 72, Purdon's Pennsylvania Statutes Annotated, 1931, and 1937 Cumulative Supplement, 1937.