Flournoy v. Sperry

STEPHENS, J.

Leonard M. Sperry, domiciled in California, died on September 11, 1963, leaving surviving his spouse, Rose Sperry. At time of death, Mr. Sperry held in joint tenancy with Mrs. Sperry certain real and personal property having an appraised value of $186,850.40. All of this joint tenancy property had derived from Mr. Sperry’s personal earnings during the marriage and during a period that the couple were domiciled outside of California. It is conceded that all of this joint tenancy property is such as is defined in Probate Code, section 201.5

1

and in Revenue and Taxation Code, section 15300.

2

In preparing the Report of Inheritance Tax Appraiser, the

[730]

appraiser excluded one-half of the net value of the said joint tenancy property under Revenue and Taxation Code section 13672.

3

In addition, there was excluded one-half of the remaining one-half of the net value under Revenue and Taxation Code section 13554.5.

4

The result is that in the report an inheritance tax was imposed on one-fourth of the net value of the property. Objection by the controller is made to the report, and specifically to the exclusion as made in the report under Revenue and Taxation Code section 13554.5. The probate court approved the report of the inheritance tax appraiser. The appeal is from this order.

Generally, inheritance taxation of joint tenancy property is governed by section 13671,

5

which bases the tax incidents on the portion of the consideration contributed by each joint tenant. To the extent consideration is provided by

the

deceased joint tenant, passage

to the

surviving joint tenant at death is considered a transfer for inheritance tax purposes. There is a qualification of this general statutory rule, however, in the case of joint tenancy property which had as its source what has been referred to as quasi-community property.