TAXATION - JURISDICTION TO TAX INTANGIBLES OF NONRESIDENT DECEDENTS - CORPORATE STOCK

Authors

Abstract

The decedent, a resident of Massachusetts, died in 1924 owning a large block of stock in a Maine corporation. After Massachusetts had already collected an inheritance tax assessed against these shares, the Maine tax authorities levied a similar tax, basing their claim on the fact of incorporation under Maine law. The state supreme court, 130 Me. 123, 154 Atl. 103 (1931), held that such shares were within the jurisdiction for taxing purposes even though their owner was a nonresident decedent. An appeal was taken to the United States Supreme Court. Held, the rule in Farmers' Loan & Trust Co. v. Minnesota, 280 U.S. 204, So Sup. Ct. 98, 74 L. ed. 371 (1930), is applicable to corporate shares. Intangibles of nonresident decedents are not subject to taxation. "It is unreasonable and incompatible with a sound construction of the Fourteenth Amendment to hold that jurisdiction to tax that event (death) may be distributed among a number of states." Justices Stone, Brandeis, and Holmes joined in a dissent, contending that, despite the evils of multiple taxation, they were not of such a nature as to infringe constitutional limitations. First Nat. Bank of Boston v. Maine, United States Supreme Court, No. 171 (Jan. 4, 1932). 6 U. S. Daily (Jan. 5, 1932).

Recommended Citation

TAXATION - JURISDICTION TO TAX INTANGIBLES OF NONRESIDENT DECEDENTS - CORPORATE STOCK, 30 Mich. L. Rev. 630 (1932).
Available at: https://repository.law.umich.edu/mlr/vol30/iss4/24