superintendent of insurance as having violated any of the laws of this state relating to insurance, he shall make or cause to be made an examination of the books and records of the company seeking admission, and before granting license to do business in this state, he shall require it to pay into the office of the state treasurer a penalty equal to twenty per cent. of all premiums written in this state, for the six years next preceding the date of request for admission, and upon which such taxes have not already been paid. (R. S. Sec. 2745c.)

Expenses of inspection to be paid by company.

SEC. 5444. The superintendent of insurance shall receive, as compensation for services rendered under the provisions of this chapter, his necessary expenses. Such sum shall be charged against the company or companies so visited by him, and be collected by suit in any court of competent jurisdiction. (R. S. Sec. 2745d.)

SEC. 5331. All property within the jurisdiction of this state, and any interests therein, whether belonging to inhabitants of this state or not, and whether tangible or intangible, which pass by will or by the intestate laws of this state, or by deed, grant, sale or gift, made or intended to take effect in possession or enjoyment after the death of the grantor, to a person in trust, or otherwise, other than to or for the use of the father, mother, husband, wife, lineal descendant or adopted child, shall be liable to a tax of five per cent. of its value above the sum of five hundred dollars. Fifty per cent. of such tax shall be for the use of the state; and fifty per cent. of such tax shall go to the city, village or township in which said tax originates. All administrators, executors and trustees, and any such grantee under a conveyance made during the grantor's life, shall be liable for all such taxes, with lawful interest as hereinafter provided, until they have been paid, as hereinafter directed. Such taxes shall become due and payable immediately upon the death of the decedent and shall at once become a lien upon the property, and be and remain a lien until paid. (103 v. 463.) R. S. Sec. 2731-1.

An earlier form of this statute (91 v. 169; act of April 20, 1894) was not unconstitutional by reason of its discrimination between collateral kindred: Hagerty v. State, ex rel.,

55 O. S. 613.

The property "which shall pass by sale" within the meaning of the act is such only as passes in transactions which are in fact gifts, though in form sales, and the act does not restrict the right to dispose of property by sale for a valuable consideration, which the parties in good faith, deem adequate Hagerty v. State, ex rel., 55 O. S. 613.

Personal property which is located in Ohio is subject to the inheritance tax, whether the owner resides within the state or without it: In re Estate of Speers, 4 O. N. P. 238, 6 O. D. (N. P.) 398.

A bequest to the wife of an adopted son is subject to this tax: In re Estate of Hunnewell, 3 O. L. R. 52.

A legacy to a stepson is subject to this tax: In re Will of Hooper, 4 O. N. P. 186, 6 O. D. (N. P.) 560.

The amount of the tax is not to be computed upon the amount of the legacy after deducting the amount of the tax: In re Will of Hooper, 4 O. N. P. 186, 6 O. D. (N. P.) 560.

A contingent devise is not taxable until it becomes vested: In re Will of Hooper, 4 O. N. P. 186, 6 O. D. (N. P.) 560.

Compensation for services for which provision is made by will is not subject to this tax; In re Will of Hooper, 4 0. N. P. 186, 6 O. D. (N. P.) 560.

Where the probate court, in the settlement of the estate of a decedent, determines the liability of a devise, legacy, bequest or inheritance to pay a collateral inheritance tax, under the provisions of this section, appeal may be taken by either party to the controversy regarding the tax, from the judgment of the probate court, to the court of common pleas as authorized by G. C. § 5344; and where the state, or the prosecuting attorney, in behalf of the state, takes the appeal, it may be done without giving an undertaking for such appeal, and without filing the written notice of an intention to appeal provided for in G. C. § 11207. The appeal may be perfected by either party according to the provisions of G. C. §§ 11212 and 12226: Humphreys v. State, 70 O. S. 67.

Boards and societies and auxiliaries thereto, which are incorporated and organized under the laws of other states, for "purposes of purely public charity or other exclusively public purposes," are not "institutions" of that class in this state within the meaning of this section: and where they are entitled to receive property within the jurisdiction of this state, by deed of gift, bequest or devise, such gift, bequest or devise is liable to a collateral inheritance tax as provided in this section, although some of the charitable work, operations and enterprises of the institutions so incorporated and organized are carried on within this state. The statute so construed is not obnoxious to the second section of our bill of rights, nor to the fourteenth amendment of the constitution of the United States: Humphreys v. State, 70 O. S. 67.

If a will which is executed in this state, passes to one who is not related to the testator real or personal property situated in this state, and such legatee and devisee is appointed

executrix, and after accepting such trust resigns without complying with the provisions of this and the following section, it is the duty of the probate court to appoint an administrator de bonis non with the will annexed to comply with the requirements of such statute: Chamberlain v. Stecher, 78 O. S. 271.

A law of a general nature, which is in full force in every part of the state, complies with Art. 11, § 26, of the constitution, requiring laws of a general nature to have uniform operation throughout the state: State, ex rel., v. Ferris, 53 O. S. 314 [affirming State, ex rel., v. Ferris, 9 G. C. C. 298, 6 O. C. D. 158].

The act of April 20, 1894, entitled, "An act to impose a direct inheritance tax," 91 O. L. 166, by its exemption from taxation of the right to receive or succeed to estates not exceeding twenty thousand dollars in value, and taxing the whole right of receiving or succeeding to estates which exceed that sum in value, and in taxing at a higher rate per centum the right to receive or succeed to estates of larger value than to estates of smaller value, is in conflict with § 2 of the bill of rights of the constitution of this state, which declares that, "All political power is inherent in the people. Government is instituted for their equal protection and benefit"; and the whole act is therefore unconstitutional and void: State, ex rel., v. Ferris, 53 O. S. 314 [affirming State, ex rel., v. Ferris, 9 O. C. C. 298, 6 O. C. D., 158].

The direct inheritance tax law of April 25, 1904 (97 v. 398), was held to be constitutional: State, ex rel., v. Guilbert, 70 O. S. 229; see, also, Hostetter v. State, 5 O. C. C. (N. S.) 337, 16 O. C. D. 702 [reversed, Eury v. State, 72 O. S. 448].

The act passed and approved April 25, 1904 (97 v. 398), entitled "An act to impose a tax upon the right to succeed to, or inherit property," is not retroactive, and applies only to such rights arising on a death occurring on or subsequent to that day: Eury v. State, 72 O. S. 448 [reversing Hostetter v. State, 5 O. C. C. 337, 16 O. C. D. 702].

The direct inheritance tax law was held not to apply to vested estates where the death had occurred prior to the passage of this act: Estate of Bushnell, 2 O. N. P. (N. S.) 673.

The act of April 2, 1906 (98 v. 229), which repealed the direct inheritance tax law of April 25, 1904 (97 v. 398), was not affected in its operation by G. C. § 26, with reference to the effect of repealing statutes; and accordingly the right to collect such tax terminated when the act took effect: Friend v. Levy, 76 O. S. 26.

The meaning of the phrase "in which said tax originates," as used in section 5331, as amended in 103 O. L.. 463, is that the situs of the property passing by descent, devise, or deed or gift for general property taxation purposes in this state determines the place of the origination of the tax. A. G. R. 1914, p. 333.

In receiving property in the manner provided by section 5331, G. C., as amended, 103 O. L., 463, a public institution of learning, incorporated under the laws of another state, is not exempt from the collateral inheritance tax provided in said statute, following Humphrey v. State, 70 O. S., 67.

The prosecuting attorney of a county is without authority in law to settle a claim for collateral inheritance taxes for a sum less than the amount taxable. A. G. R. 1915, p. 2222. Where heirs contest the probate of a will and a compromise is reached whereby the whole estate is divided between devisees and legatees on the one hand, and contestants, on the other, and the will is admitted to probate as a valid will, administration to follow the terms of the compromise, the amount and apportionment of the collateral inheritance tax is determined by the terms of the will itself and the value of the inheritances created thereby, without reference to the compromise. A. G. R. 1915, p. 2447.

The fact that United States bonds constitute a part of an inheritance passing to collateral heirs does not affect the amount of the collateral inheritance tax. A. G. R. 1915, p. 2449. The Ohio collateral inheritance tax law is not applicable to the transfer of shares of stock in an Ohio corporation belonging to the estate of a deceased resident of Massachusetts. A. G. R. 1915, p. 317.

Under the collateral inheritance tax, section 5331, "said tax originates" as to the right to succeed to real estate in the city, village or township in which said real estate is located. A. G. R. 1915, p. 132.

Under Section 5331, General Code, the exemption from the collateral inheritance tax therein provided for, cannot apply to a devise to a person recognized as an adopted child, unless such child has been made a legal heir by the declaration before the probate court provided for in Section 8598, General Code. A. G. R. 1912, p. 2037.

It is the object of the collateral inheritance tax to place an assessment upon the privilege of receiving and not upon the property devised. The legislature intended the value to be taxed, to be measured by the value of the thing inherited and not by the value of the thing devised. Under section 5331, G. C., therefore, which provides that property which passes by will or by intestate laws of this state to other than certain designated relatives, shall be liable to a tax of 5 per cent. of its value above the sum of $200, the sum of $200 so designated shall be deducted from the amount which the taxable heir is entitled to, after all expenses and debts of the estate devised have been subtracted. A. G. R. 1913, p. 1111, (Note change in section made subsequent to this opinion.)

Exemptions.

SEC. 5332. The provisions of the next preceding section shall not apply to property, or interests in property, transmitted to the state of Ohio under the intestate laws of the state, or embraced in a bequest, devise, transfer or conveyance to, or for the use of the state of Ohio, or to or for the use of a municipal corporation or other political subdivision thereof for exclusively public purposes, or public institutions of learning, or to or for the use of an institution in this state for purpose only of public charity or other exclusively public purposes. The property, or interests in property so transmitted or embraced in such devise, bequest, transfer or conveyance shall be exempt from all inheritance and other taxes while used exclusively for any of such purposes. (94 v. 101, § 1.)

Bequests to the Fresbyterian church, part to be used in Ohio, but the greater part thereof to be used elsewhere, are not exempt, since they are not for the benefit of the inhabitants of this state: In re Estate of Brown, 13 0. D. (N. P.) 168.

A bequest to a college, the income of which is to be used in aiding worthy students of a theological seminary, is exempt from the inheritance tax, when the seminary is open to all the public upon the same terms, and if not operated for profit.

A bequest to a society for aiding needy ministers of a certain religious denomination is subject to the inheritance tax.

A bequest to executors in trust to be distributed to any societies and corporations organized for benevolent and charitable purposes is subject to the inheritance tax.

A bequest to an individual to be administered for charitable purposes is subject to the inheritance tax. A bequest to a church to be administered for charitable purposes in the discretion of the trustees of the church is subject to the inheritance tax.

Two bequests in the same will to the same cemetery corporation, the income of which is to be used, respectively, for the maintenance of different cemetery lots, are to be regarded as separate estates for the purpose of the inheritance tax, and if neither exceeds five hundred dollars in amount no tax is assessable,

A bequest to a charitable home for Jewish aged and infirm, which is open only to members of a specified religious denomination or sect, or those entertaining a given religious belief, is not exempt from taxation, but if the home is open to all members of a certain race upon the same terms, the bequest is exempt from the inheritance tax.

A bequest to a Jewish hospital association maintaining a hospital which is open to all on the same terms and is charitable in its nature is exempt from the inheritance tax.

A bequest to a college, the income of which is to be used in sustaining a library therein, is exempt from taxation, if the college is open to all on the same terms, and is not operated for profit. A. G. R. 1915, p. 493.

A bequest to an institution of learning, which limits its students to a particular class and religious faith, is subject to the collateral inheritance tax. A. G. R. 1915, p. 2373.

Appraisement and deduction of property not liable.

SEC. 5333. When a person bequeathes or devises property to or for the use of father, mother, husband, wife, lineal descendant, or adopted child, during life or for a term of years, and the remainder to a collateral heir, or to a stranger to the blood, the value of the prior estate, shall be appraised, within sixty days after the death of the testator, in the manner hereinafter provided, and deducted, together with the sum of five hundred dollars, from the appraised value of such property.

When compensation of executor, trustee, etc., liable to tax.

SEC. 5334. When a decedent appoints one or more executors or trustees, and instead of their lawful allowance makes a bequest or devise of property to them which would otherwise be liable to such tax, or appoints them his residuary legatees, and said bequests, devises, or residuary legacies exceed what would be a reasonable compensation for their services, such excess shall be liable to such tax, and the probate court having jurisdiction of their accounts shall fix such compensation. (90 v. 15, § 3.) R. S. Sec. 2731-3.

If the testator has bequeathed a debt due from the executor to him to such executor, in lieu of his statutory compensation, such debt is not taxable upon the excess thereof over the statutory compensation, if it is not clear that the amount of such debt is more than reasonable compensation for the work necessary to settling such estate: In re Will of Hooper, 4 O. N. P. 186, 6 O. D. (N. P.) 560.

Payment; proceedings for collection.

SEC. 5335. Taxes imposed by this subdivision of this chapter shall be paid into the treasury of the county in which the court having jurisdiction of the estate or accounts is situated, by the executors, administrators, trustees, or other persons charged with the payment thereof. If such taxes are not paid within one year after the death of the decedent, interest at the rate of eight per cent. shall be thereafter charged and collected thereon, and if not paid at the expiration of eighteen months after such death, the prosecuting attorney of the county wherein said taxes remain unpaid, shall institute the necessary proceedings to collect the taxes in the court of common pleas of the county, after first being notified in writing by the probate judge of the county of the non-payment thereof. The probate judge shall give such notice in writing. If the taxes are paid before the expiration of one year after the death of the decedent, a discount of one per cent. per month for each full month that payment has been made prior to the expiration of the year, shall be allowed on the amount of such taxes. (91 v. 170, § 4.) R. S. Sec. 2731-4.

Where the collateral heirs of an intestate decedent are of remote degree of relationship and reside in various parts of the United States, so that the administrator in the exercise of due diligence was unable for some time to acquire the information necessary to enable him to distribute the estate or to know the number and amount of the various shares into which it is to be divided; and, where, moreover, part of the real property of the estate, which constitutes the major portion of its value, is ancestral and part is non-ancestral and litigation arises as to the inheritance thereof which is not terminated for some time, failure of the administrator to pay the collateral inheritance tax on the various shares thereof within one year after the death of the decedent, if due to such causes, is excusable and the eight per cent interest provided for by section 5335, G. C., being in the nature of a penalty, should not be collected. A. G. R. 1915, p. 1109.

Deduction or collection of tax by administrator, etc.

SEC. 5336. An administrator, executor, or trustee, having in charge, or trust, property subject to such law, shall deduct the tax therefrom, or collect the tax thereon from the

legatee or person entitled to the property. He shall not deliver any specific legacy or property subject to such tax to any person until he has collected the tax thereon. (90 v. 15, § 5.) R. S. Sec. 2731-5.

Deduction and payment of tax upon certain legacies.

SEC. 5337. When a legacy subject to such tax is charged upon or payable out of real estate, the heir or devisee, before paying it, shall deduct the tax therefrom and pay it to the executor, administrator, or trustee, and the tax shall remain a charge upon the real estate until it is paid. Payment thereof shall be enforced by the executor, administrator, or trustee, in like manner as the payment of the legacy itself could be enforced. (90 v. 16, § 6.) R. S. Sec. 2731-6.

Retention or collection of tax upon certain legacies.

SEC. 5338. If such legacy is given in money to a person for a limited period, such administrator, executor or trustee shall retain the tax on the whole amount. If it is not in money, he shall make an application to the court having jurisdiction of his accounts to make an apportionment, if the case require it, of the sum to be paid into his hands by such legatee on account of the tax and for such further order as the case may require. (90 v. 16, § 7.) R. S. Sec. 2731-7.

Sale of property for payment of tax.

SEC. 5339. Administrators, executors and trustees may sell so much of the estate of the deceased as will enable them to pay said tax in like manner as they are empowered to do for the payment of his debts. (90 v. 16, § 8) R. S. Sec. 2731-8.

A widow to whom a dower has been assigned in timber land may cut timber on such land to pay the taxes thereon: Crockett v. Crockett, 2 Q. S. 181.

Proceedings after filing of inventory.

SEC. 5340. Within ten days after the filing of the inventory of every such estate, any part of which may be subject to a tax under the provisions of this subdivision of this chapter, the judge of the probate court, in which such inventory is filed, shall make and deliver to the county auditor of such county a copy of the inventory; or, if it can be conveniently separated, a copy of such part of the estate, with the appraisal thereof. The auditor shall certify the value of the estate, subject to taxation hereunder and the amount of taxes due there from, to the county treasurer, who shall collect such taxes, and thereupon place twenty-five per cent. thereof to the credit of the county expense fund, and pay seventy-five per cent. thereof into the state treasury, to the credit of the general revenue fund, at the time of making his semi-annual settlement. (91 v. 170, § 9.) R. S. Sec. 2731-9.

From a review of the decisions it is now settled in this state that the collateral inheritance tax is a tax upon the right to receive the property and not a tax upon the estate itself.

It is the specific legacies which are to be taxed therefore, and debts of the estate, as well as costs of administration, must be deducted when the estate in the aggregate has been devised collaterally.

These deductions may not be made from the inventory filed by the probate judge, under Section 5341 of the General Code, with the auditor. Such deductions must be made by application to probate court under the procedure set out for appraisal, etc., under Sections 5343 and 5344 of the General Code. Such procedure may be avoided, however, by agreement between the prosecuting attorney and all interested parties. A. G. R. 1912, p. 1430.

Under the inheritance tax law, the appraisement returned in the probate court is, in the first instance, binding upon all parties. If land devised to collateral relatives is sold in partition at less than the appraised value thereof, the probate judge may not take cognizance of this fact for the purpose of computing the tax.

The probate court may not appoint appraisers to determine the actual market value of the property except on formal application under the statute. Such application must be made within a reasonable time after the death of the testator and the filing of the inventory. A. G. R. 1915, p. 8.

Information to be furnished probate judge by executor, etc.

SEC. 5341. When for any reason the devisee, legatee or heir who has paid such tax to become subject to such tax, the executor, administrator or trustee of the decedent shall inform the probate judge thereof within six months after he has assumed the duties of his trust, or if the fact is not known to him within that time. then within one month from the time that it does become so known to him. (90 v. 16, § 10.) R. S. Sec. 2731-10.

Refunding of tax.

SEC. 5342. When for any reason the devisee, legatee or heir who has paid such tax relinquishes or reconveys a portion of the property on which it was paid, or it is judicially determined that the whole or part of such tax ought not to have been paid, the tax, or the due proportional part thereof, shall be repaid to him by the executor, administrator or trustee. (90 v. 16, § 11.) R. S. Sec. 2731-11.