Estate of Morrison

130 Cal.App.3d 543 (1982) Estate of JAMES EARL MORRISON, Deceased.

KENNETH CORY, as State Controller, Petitioner and Appellant,

v.

THELMA V. MORRISON, Objector and Respondent.

Docket No. 25720. Court of Appeals of California, Fourth District, Division Two.

April 12, 1982. [545] COUNSEL

Myron Siedorf, Margaret Groscup and Bettina A. Bate for Petitioner and Appellant.

Theodore J. Beall for Objector and Respondent.

OPINION

TAMURA, J.[*]

The sole issue on this appeal is whether Revenue and Taxation Code section 13880 offends the equal protection clauses of the federal and state Constitutions because it exempts from state inheritance tax benefits accruing under "any public retirement system" without at the same time extending a like exemption to benefits payable under a private pension plan.[1]

James Earl Morrison worked for Rockwell International and upon his death, his surviving spouse was entitled to a pension of $900 per month, the actuarial value which was calculated to be $125,965. The inheritance tax referee included the pension benefits in the inheritance tax report, exempting one-half as the surviving spouse's community property interest but imposing a tax on the remaining one-half. The surviving spouse filed an objection to the report on the ground that imposition of the inheritance tax on benefits from a private pension plan while exempting such benefits from a public retirement system violated the equal protection clauses of the state and federal Constitutions. The trial court sustained the objection on equal protection grounds and entered judgment decreeing the surviving spouse's benefits exempt from inheritance tax.

The state Controller appeals from the judgment contending (1) that private pension benefits are subject to inheritance tax where, as here, [546]