Maxwell v. Bugbee - 250 U.S. 525 (1919)
U.S. Supreme Court
Maxwell v. Bugbee, 250 U.S. 525 (1919)
Maxwell v. Bugbee
Nos. 43, 238
Argued March 18, 19, 1919
Decided October 27, 1919
250 U.S. 525
Article IV, § 2, par. 1, of the Constitution was intended to prevent discrimination by the several states against citizens of other states in respect of the fundamental privileges of citizenship. P. 250 U. S. 537.
The Fourteenth Amendment recognizes a distinction between citizenship of the United States and citizenship of one of the states, and its purpose in declaring that no state shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States is not to transfer to the Federal government the protection of civil rights inherent in state citizenship, but to secure those privileges and immunities that owe their existence to the federal government, its national character, its Constitution, or its laws. P. 250 U. S. 537. Slaughter-House Cases, 16 Wall. 36.
These privileges and immunities provisions do not prevent a state from taxing the privilege of succeeding by will or inheritance from a nonresident decedent to property within its jurisdiction. P. 250 U. S. 538.
Quaere whether these privileges and immunities clauses are applicable when the alleged discrimination (in a state inheritance tax law) is based not on citizenship, but on the residence or nonresidence of the decedent? Id.
The fact that a state tax on the succession to local property of a nonresident decedent is measured by the ratio in value of such property to the entire estate, including real and personal property in other states, does not make it a tax on the property beyond the jurisdiction, and thus obnoxious to the due process clause of the Fourteenth Amendment. P. 250 U. S. 539.
The difference between the relations to the resident and nonresident testators or intestates affords justification within the equal protection provision of the Fourteenth Amendment for measuring succession taxes in different ways. P. 250 U. S. 540.
The question of equal protection must be decided between resident and nonresident decedents as classes, rather than by the incidence of the tax in particular cases. P. 250 U. S. 543.
The New Jersey inheritance tax, as to estates of resident decedents, is measured on all the property passing testate or intestate under the law of the state (foreign realty excluded), with various exemptions and graduations based on relationship of beneficiaries and amounts received; as to estates of nonresidents, the tax on the transfer to the personal representative, respecting only local real and tangible personal property, stock of New Jersey corporations and of national banks located in the state, bears the same ratio to the entire tax which would be imposed under the act if the decedent had been a resident and all his property real and personal had been located within the state, as such property within the state bears to the entire estate wherever situate, specific devises or bequests of property within the state being excluded from this computation. Owing to
the graduation and exemption feature, this plan of apportionment, in cases of certain large estates of nonresidents embracing large real estate and other assets in other state, resulted in greater taxes for the transfer of their property in New Jersey than would have been assessed for transfer of an equal amount of property of a decedent dying resident in the state. Held that such taxes did not infringe the privileges and immunities provision of Article IV of the Constitution, or the like provision, or the equal protection or due process clauses, of the Fourteenth Amendment.
90 N.J.L. 707; 2 id. 514, affirmed.
The cases are stated in the opinion.