Harrison v. Northern Trust Co., 317 U.S. 476 (1943)

Please note: this case begins in mid-page. It therefore shares a citation with the last page of the previous case. If you are attempting to follow a link to the last page of 317 U.S. 456, click here.

Harrison v. Northern Trust Co.

No. 103

Argued December 8, 1942
Decided January 11, 1943
317 U.S. 476

CERTIORARI TO THE CIRCUIT COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

Syllabus

1. In § 303(a) of the Revenue Act of 1926 which, as amended by § 807 of the Revenue Act of 1932, provides that, where the federal estate tax is

payable . . . out of the bequests, legacies, or devises otherwise deductible under this paragraph, then the amount deductible under this paragraph shall be the amount of such bequests, legacies, or devises reduced by the amount of such taxes,

the words "payable out of" are used in the sense of "diminished or reduced by" the payment of the tax. P. 479.

2. The legislative history of a statute may be considered in ascertaining its meaning, no matter how clear its words may appear on superficial examination. P. 479.

3. Where a residuary estate is bequeathed to charities for which deduction is allowed by § 303(a) of the Revenue Act of 1926, as amended by § 807 of the Revenue Act of 1932, and, by the state law, the federal estate tax is a charge not against the residue, but against the entire estate, the amount which, in computing the federal estate tax, may be deducted from the gross estate on account of the charities is the amount of the residuary estate actually passing to the charitable beneficiaries after provision is made for the payment of the tax. P. 480.

4. The deduction here involved is one which Congress could have denied altogether, and the limitation placed upon it by § 807 is constitutional. P. 480.

125 F.2d 893 reversed.

Certiorari, post, p. 612, to review the affirmance of a judgment for the present respondents in an action to recover an alleged overpayment of federal estate taxes.