In re the Transfer Tax upon the Estate of Schmoll

Headnote

Transfer tax —• ante-nuptial agreement ■—• when portion of estate of decedent passing to his children under ante-nuptial agreement is not subject to transfer tax.

Matter of Schmoll, 191 App. Div. 435 , affirmed.

Appeal from an order of the Appellate Division of the Supreme Court in the first judicial department, entered April 9, 1920, which reversed an order of the New York County Surrogate’s Court assessing a transfer tax upon the estate of Edmund Schmoll, deceased. Decedent died a resident of the city of New York but a citizen of Switzerland. By the terms of an ante-nuptial agreement entered into between himself and his prospective wife at Paris, France, two-thirds of his estate, on the death of the husband, was to pass to his widow and one-third to any children of the marriage or their descendants. The surrogate exempted the portion passing to the widow but taxed the portion passing to the children under the

provisions of subdivision 4 of section 220 of the Tax Law, holding that the transfer to the children was entirely donative in its character. The Appellate Division held that the transfer was for a valuable consideration, and that the amounts which passed to the children were not subject to a transfer tax.