Wheelwright v. Tax Commissioner

• Decision Date: 19 May 1920
• Citation: 235 Mass. 584
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: ARTHUR W. WHEELWRIGHT & another, executors, v. TAX COMMISSIONER.

235 Mass. 584

ARTHUR W. WHEELWRIGHT & another, executors, v. TAX COMMISSIONER.

Supreme Judicial Court of Massachusetts, Suffolk.

May 19, 1920

March 2, 1920.

Present: RUGG, C.

J., BRALEY, CROSBYCARROLL, & JENNEY, JJ.

Tax, On income received by executor.Executor and Administrator.Statute Construction.Constitutional Law, Taxation.Practice, Civil Costs.

Exemptions from taxation must appear plainly either from the express words of a statute or by necessary intendment from its express words.

The provision of St. 1916, c. 269, Section 8, that "The provisions of this act with reference to the taxation of income received by trustees shall, so far as apt, and except as otherwise provided herein, apply to the income received by executors and administrators," does not operate to extend to executors and administrators the exemptions later added for the benefit of trustees by St. 1918, c. 207, amendingSt 1916, c. 269,

Section 9.

In the above statutes so construed there is nothing violative of the constitutional rights of executors and administrators.

Upon the denial of an abatement of a tax upon income asked for by an executor by a petition under St. 1916, c. 269, Section 20, this court, under St. 1909, c. 490, Part I, Section 80, (made applicable to the proceeding by St. 1916, c. 269, Section 20,) ordered judgment for the tax commissioner for his expenses and costs, to be taxed by the Superior

Court.

PETITION, filed in the Superior Court under St. 1916, c. 269, Section 20, by the executors of the will of John W. Wheelwright, late of Westwood, seeking an abatement of a tax upon income assessed to the petitioner under St. 1916, c. 269.In the Superior Court the petition came on to be heard by Hammond, J., and, the parties agreeing that the petition and the answer stated all material facts, the judge reported the case to this court for determination.

H. Wheeler, for the petitioners.E. H. Abbot, Jr., Assistant Attorney General, for the respondent.

RUGG, C. J.This is a petition under St. 1916, c. 269, Section 20, by the executors of the will of a deceased resident of this Commonwealth for the abatement of a tax.The single question presented is whether the executors of a will who receive income payable to inhabitants of this Commonwealth are entitled, in the assessment upon them of income taxes, to the same deductions for taxes and expenses paid as are allowed by the income tax law to trustees.

Provision is made by the income tax law, St. 1916, c. 269, for the assessment of taxes upon certain incomes received both by executors or administrators and by trustees.Under the divisional heading of the statute"Estates of Deceased Persons," is Section 8, Which provides at some length for a tax upon incomes received by "persons since deceased" and by "estates of deceased persons."The last sentence of that section is in these words: "The provisions of this act with reference to the taxation of income received by trustees shall, so far as apt, and except as otherwise provided herein, apply to the income received by executors and administrators."This is followed immediately by the divisional heading "Property Held in Trust," and Section 9, wherein provision is made in considerable detail for the taxation of "The income received by estates held in trust by trustees."No specific deductions were allowed in this or in the preceding section, although of course those provided by the general terms of Section 3 were applicable.An amendment of Section 9 was made by St. 1918, c. 207, whereby several clauses were inserted to the effect that "In the computation of the tax the trustee," in addition to deductions previously allowed under Section 3, "shall be entitled to the following deductions from income taxable under sections two, five (a) and five (c) of this act, respectively, before the taxable income of the beneficiary or beneficiaries shall finally be determined."Then follows an enumeration of four different kinds of permissible deductions.

The form of St. 1918, c. 207, is that the original Section 9"is hereby amended by inserting" at places identified by lines and preceding word, the specified words, "so as to read as follows: --" There then is printed the full Section 9 as it stands in its amended form.The effect of this phraseology is that the original Section 9 has become a thing of the past, valuable only as matter of history and has been superseded by the new Section 9.Other statutory provisions relating to the old and not inconsistent with the new section are applicable to the latter.Fitzgerald v. Lewis,164 Mass. 495 .Merrill v. Paige,229 Mass. 511 .The statute now is to be treated and interpreted as if the new Section 9 had been a part of the original enactment, except that light may be thrown upon its meaning by the fact that it is an amendment and by comparison of the old form with the amendment.

The precise point to be decided is whether the final sentence of Section 8 quoted above, extends to executors the right to make deductions created by the words of the amending chapter 207 for the benefit of trustees.That amending chapter in substance creates an exemption from taxation of a part of the income of trustees.Exemptions from taxation are not to...