WASHINGTON

INHERITANCE AND ESTATE TAXES

Tax imposed. An inheritance tax is imposed upon all estates within the jurisdiction of this State, and any interest therein, whether belonging to inhabitants of this State or not, whether tangible or intangible, and which pass by any of the methods hereinafter shown, but subject to the exemptions allowed. (11201)

Transfers taxable.—This tax applies to all such property which passes by will or by the statutes of inheritance of this or any other State; or by deed, grant, sale, or gift made in contemplation of the death of the grantor or donor, or so made and intended to take effect in possession or in enjoyment at or after such death. Whenever real or personal property, other than real property held by the entirety, is held in the joint names of two or more persons, or is deposited in joint names, and payable to either or to the survivor, upon the death of one of such persons, the survivor's right to immediate ownership or possession and enjoyment is deemed a transfer taxable hereunder, excepting such part as may be shown to have originally belonged to such survivor, and never to have been acquired from the decedent for less than a fair consideration. (11201)

Same. If a decedent makes a transfer (except in case of a bona fide sale), by trust or otherwise, of any property in contemplation of or intended to take effect in possession or enjoyment at or after his death, or if he makes a transfer, by trust or otherwise, under which he had retained for his life or for any period not ascertainable without reference to his death, or for any period which does not in fact end before his death, (a) the possession or enjoyment of, or the right to the income from, the property, or (b) the right, either alone or in conjunction with any person, to designate the persons who shall possess or enjoy the property, or if insurance passes under a contract executed by the decedent in favor of a specific beneficiary, and if in either case the tax in respect thereto is not paid when due, the transferee, trustee, or beneficiary is personally liable therefor; and such property, to the extent of the decedent's interest therein at the time of such transfer, or to the extent of such beneficiary's interest under such contract of insurance, is subject to a like lien equal to the amount of such tax, but this does not apply to bona fide sales of property. (11201)

Same. Whenever any person or corporation exercises a power of appointment derived from any disposition of property, such appointment when made is deemed a transfer taxable under these provisions in the same manner as though the property to which such transfer relates belonged absolutely to the donee of such power and had been bequeathed or devised by such donee by will, except that where the donor was a resident and the donee, at the time the appointment took effect, is a nonresident, the property to which the appointment relates is taxable as having been transferred in the estate of the donor. (11201c)

Same. Insurance payable upon the death of any person is deemed a part of the estate for the purpose of computing this tax and is taxable to the person, partnership or corporation entitled thereto. Such in

surance is taxable irrespective of the fact that the premiums have been paid by some person, partnership, or corporation other than the insured, or paid out of income accruing from principal provided by the assured for such payment, whether such principal was donated in trust or otherwise; but the total amount so exempt, regardless of the number of policies, is not to exceed $40,000. It is provided, however, that in the case of insurance upon the life of a decedent officer or employee of a corporation, payable to the corporation, or upon the life of a decedent, employee of or partner in a business enterprise, payable to one or more of the partners, where all the premiums upon such policy have been paid exclusively by such beneficiary, upon the death of the decedent the amount of the proceeds of the policy in excess of the cash surrender value immediately preceding the death of the decedent, is deemed a part of the estate for the purpose of computing this tax. Where more than one beneficiary is entitled to the benefit of the provisions of this paragraph, the exemption is apportioned among such beneficiaries ratably and proportionately; but where there is a fraternal benefit society insurance payable upon the death of the decedent and other insurance payable upon such death, the $40,000 exemption is first taken from the fraternal benefit society insurance and if the same does not equal $40,000, then the balance of the $40,000 is prorated among the other policies. (11211b)

Additional estate tax. Where the inheritance tax imposed by the laws of this State is of a lesser amount than the maximum credit of 80 percent of the Federal estate tax allowed by the Federal estate act,2 then the tax provided for by said laws is to be increased so that the amount of tax due this State shall be the maximum amount of the credit allowed under said Federal act. Where no tax is imposed by this State because of exemptions and a tax is due the United States under said Federal act, then a tax is due this State equal to the maximum credit allowed under said Federal act. If the amount of tax imposed by this State increased by the provisions of this paragraph be found to be more than the maximum credit allowed under said Federal act, any excess over and above said maximum credit is refunded. (112026)

Deductions allowed.-In determining the value of each estate transferred, the following deductions are allowed: Debts owing by the decedent at the time of his death; local and State taxes due from the estate prior to death; Federal estate taxes; funeral expenses, monument or crypt, court costs, fees of executors and attorneys, and a family allowance not exceeding $1,000. (11201)

Exemptions. There are exempt from this tax the following: Transfers to beneficiaries of class A, $10,000; class B, $1,000; no exemption for class C; proceeds of Federal war risk insurance passing from the Federal Government to the estate of a deceased soldier, and in passing from such estate to his heirs, legatees, devisees or beneficiaries; transfers of property when made for relief of the aged, indigent, and poor people, maintenance of sick or maimed, support or education of orphans or indigent children, and when made to this State, or any county, city, town, or school district therein, or to any public park or playground within this State, whether municipal or otherwise; and also any transfers made to any municipal corporation within this State for eleemosynary, charitable, educational, or philanthropic

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

purposes, or to schools and colleges in this State supported in whole or in part by gifts, endowments, or charity; but all such gifts and transfers are limited for use within this State. All gifts and transfers made to or for the use of religious or nonsectarian organizations, or for the educational, benevolent, protective, or social departments growing out of, or related to, the religious work of such organizations, when limited for use within this State, are exempt from this tax. (11202, 11218, 11218-1)

Same. All property transferred by a decedent to a father, mother, grandfather, grandmother, husband, wife, lineal descendant, stepchild or adopted child or lineal descendant of either, if the same was transferred to such decedent not more than 1 year prior to his death by another decedent of class A, and a tax paid thereon to this State, is exempt from this tax. This exemption applies only to transfers upon which an inheritance tax was paid in the estate of the first decedent; but where the property so transferred and taxed has increased in value, it is taxed. (11202a)

Classification of beneficiaries. The beneficiaries under this act are classified as follows: Class A: Grandfather, grandmother, father, mother, husband, wife, child, stepchild, or any lineal descendant, of deceased. Class B: Sister or brother. Class C: All other persons and bodies politic or corporate. (11202)

Rates of tax.-The rates of tax payable by the several classes of beneficiaries are graduated as follows:

(11202)

Payment of tax; interest.-All taxes imposed under this act accrue upon the death of the decedent, and are payable to the State treasurer; if not paid within 15 months from such accrual, interest is charged at the rate of 8 percent per annum, unless payment is delayed, in which case interest is charged from the time the cause of such delay was removed. (11208, 11210)

Tax lien. This tax remains a lien on the estate transferred from the date of decedent's death until payment thereof. (11201)

Disposition of proceeds. The proceeds of this tax are for the use of the State. (11201)

Administration of act.-The State tax commission is charged with the duty of exercising general supervision of the collection of this tax. (11217)

Sources of information. Chapter 8, Title 78, Remington's Revised Statutes of Washington, Annotated, 1931, and 1937 Supplement.

WEST VIRGINIA

INHERITANCE AND ESTATE TAXES

Tax imposed.-A tax is imposed upon the transfer, in trust or otherwise, of any property, or interest therein, real, personal, or mixed, if such transfer be made as shown in the paragraph next following. (842)

Transfers taxable.-The tax is imposed if the transfer be by will or by the laws of this State regulating descent and distribution from any person who is a resident of this State at the time of his death and who dies seized or possessed of property; by same methods, if transfer is of property within the State, or within its jurisdiction, and the decedent was a nonresident at the time of his death; by a resident, or be of property within the State, or within its jurisdiction, by nonresident, by deed, grant, bargain, sale, or gift, made in contemplation of the death of the grantor, bargainor, or donor, or intended to take effect in possession or enjoyment at or after such death. If any person transfers any property which he owns, or causes any property to which he is absolutely entitled to be transferred to or vested in himself and any other person jointly, so that title therein, or in some part thereof, vests no survivorship in such other person, a transfer is deemed to occur and to be taxable upon the vesting of such title. Whenever any person exercises a power of appointment derived from any disposition of property made, such appointment when made is deemed a taxable transfer in the same manner as though the property to which it relates belonged absolutely to the donee of such power and had been bequeathed or devised by such donee by will; and whenever any person possessing such a power of appointment so derived omits or fails to exercise the same within the time provided therefor, in whole or in part, a taxable transfer is deemed to take place to the extent of such omission or failure, in the same manner as though the person thereby becoming entitled to the possession_or enjoyment of the property to which such power related had succeeded thereto by a will of the donee of the power failing to exercise such power, and takes effect at the time of such omission or failure. (842) Exemptions. All property transferred to the State or to any county, school district, or municipal corporation thereof for public purposes is exempt. No transfer of less than $100 is taxable. Property transferred for educational, literary, scientific, religious, or charitable purposes, if the rentals, profits, and proceeds of such property are used exclusively in this State, is not subject to this tax. Property transferred to the widow of a decedent is allowed exemptions. as follows: Transfers not in excess of $15,000 are entirely exempt; if in excess of $15,000 and not over $25,000, the amount exempted is. determined by subtracting from $15,000 the difference between $15,000 and the amount of the transfer; but no exemption is allowed in case of a transfer in excess of $25,000. Transfers to beneficiaries.

in class A, other than the wife, are allowed the following exemptions: If not over $5,000, they are entirely exempt; over $5,000 to $10,000, the exemption is determined by subtracting from $5,000 the difference between $5,000 and the amount of the transfer; if in excess of $10,000, no exemption is allowed. The descendants of any child referred to in class A are allowed the exemptions of the person they represent per stirpes and not per capita. (845)

Classification of beneficiaries. Beneficiaries, for purposes of taxation, are classified as follows: Class A: Wife, husband, child, stepchild, or descendants of a living or deceased child per stirpes, or father or mother, of decedent. Class B: Brother or sister of the whole or half-blood, of decedent. Class C: All other relatives of decedent. Class D: All other beneficiaries.

(843)

Rates of tax. The property transferred is taxed at the following rates: (843, 844)

Payment of tax; discount; interest.—This tax is payable to the State tax commissioner and is due at the death of the transferor; if paid within 6 months after such death, a discount of 3 percent is allowed; if not paid within 12 months after such death, interest is charged at the rate of 10 percent per annum, computed from the expiration of 12 months from such death until paid, and a penalty of 5 percent is added. The tax commissioner may suspend payment of the tax, penalty, and interest for good cause. (852, 860)

Tax lien. This tax and the interest thereon are and remain a charge and a lien upon the property transferred until paid. The person to whom the property is transferred, if he receives the same before payment of the tax, and executors, administrators, and trustees are personally liable for this tax and interest until payment, and no statute of limitations is a defense to any action for the recovery thereof. (850)

Disposition of proceeds. The proceeds of this tax are for the use of this State. (842)

Administration of act.-The State tax commissioner administers the provisions of this act.

(856)

Source of information.-West Virginia Code of 1937, Annotated.

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