Cal. Code Regs. tit. 18 § 13671

Current through Register 2024 Notice Reg. No. 50, December 13, 2024

Section 13671 - Contribution Claim by Surviving Joint Tenant

The basis for an allowance of contribution to a joint tenancy by a surviving joint tenant is the claim therefor by the survivor in completing the inquiry on form IT-22, Inheritance Tax Declaration.

Contribution claims are required to be traced back to their remote origin to prove that the original source of the funds contributed by the survivor was not the decedent. Thus, if a father gave money to his son and some years later the son used this money to create a joint tenancy with the father, the entire joint tenancy would be taxed at the father's death since the father was the contributor of the funds when they are traced back to their remote origin.

The contribution allowable to a surviving joint tenant must be reduced by its proper proportion of certain of he deductions applicable to the joint tenancy. Some of the allowable deductions under the Inheritance Tax Law apply as a proportionate reduction of the entire joint tenancy. Others apply only to the decedent's share of the joint tenancy.

(b) The deductions which apply over the whole joint tenancy and thus operate as a proportionate reduction of the survivor's gross contribution are:

(1) Attorneys' fees relating to the joint tenancy.

(2) Real property taxes on joint tenancy real property.

(3) Encumbrances on joint tenancy real property.

(4) Appraisal fee for joint tenancy property.

(5) Court costs relating to the joint tenancy.

(c) The deductions which apply to the decedent's share of the joint tenancy only and thus do not reduce the survivor's contribution are:

(1) Funeral expenses and last illness expenses, when they are deductible from the joint tenancy.

(2) Unsecured debts of the decedent, when they are deductible from the joint tenancy. These deductions are usually not deductible from a joint tenancy transfer but rather from a probate estate. However, if there is no probate estate and if they have been paid by the surviving joint tenant, they may be allowed and treated as stated.

NOTE: Reference: Section 13671, Revenue and Taxation Code.

Cal. Code Regs. Tit. 18, § 13671