          THEA~~~ORNEY             GENERAL
                      OFTEXAS




                         October 15, 1957

Hon. Robert S. Calvert           Opinion No. WW-277
Comptroller of Public Accounts
Capitol Station                  Re:   Legality of refunding
Austin 11, Texas                       inheritance taxes de-
                                       posited ursuant to
                                       Article fl
                                                388, V.C.S.,
                                       if decedent is a non-
Dear Mr. Calvert:                      resident of Texas.
          We quote the following excerpts from your letter
requesting our opinion on the above-captioned matter.
         "Clara S. Kelly died on February 6, 1957,
    and an inheritance tax report was filed with
    this Department on or about May 2, 1957, for
    her estate by Joseph C. Jackson, an accountant
    of Austin. The report states the decedent was
    a resident of Travis County upon the date of
    her death. fiis report was sworn to by Eugene
    J. Kelly, son of Clara S. Kelly.    The value of
    the net taxable estate is $355,d lg.33 consist-
    ing almost entirely of stocks and bonds located
    in a safety deposit box in the American National
    Bank of Austin. The only other property in
    which the decedent had a taxable interest was
    a life estate in a small house and lot valued
    at $5,000.00 in Alhambra, California, and a
    bank account of $1,030.00 in The California
    Bank of Alhambra.
         "Mr. Jackson was anxious to obtain waivers
    of the inheritance tax lien on all the stocks
    and bonds at an early date, so a hurried report
    was made which reflected a tax due of $5,379.82.
    Since the report was hurriedly made and we had
    no opportunit to make an early examination, we
    accepted the % 5,379.82 and placed same in our
    departmental suspense account as provided in
    Article 4388.
Hon. Robert S. Calvert, page 2 (WW-277)


          "The State of California is now asserting
     a tax on this entire estate claiming the de-
     cedent was a resident of California at the
     time of her death.
         "Mr. E. H. Smartt, Austin Attorney, has
    written us a letter in which he reaches the
    conclusion that the decedent was a resident
    of California and asks for a refund of the
    tax now in our suspense account.
         "On the facts as stated in this letter and
    those given by Mr. Smart%, please advise this
    Department as to the domicile of this decedent.
    If you hold this decedent was a resident of
    California, also advise if this Department can
    legally refund said tax."
          In addition to the facts set forth in your letter,
we quote the following facts from Mr. Smartt's letter.
         "A short history of Clara Sabrina Kelly
    would probably be helpful in determining the
    issues in question. Mrs. Kelly was originally
    a resident of the State of Ohio; her husband
    died about the year 1938, and thereafter she
    traveled between Ohio and California. Mrs.
    Kelly had two daughters living in Ohio and a
    son, Eugene J. Kelly, who moved to Austin,
    Travis County, Texas, from Kansas about 1942.
    In about 1938 or 1939, Mrs. Kelly went to
    California and bought a little home in Alhambra,
    and in 1942, she deeded this home to her five
    grandchildren retaining a life estate in herself.
    In 1942 she went back to Ohio and stayed some
    time, and in 1943, she came to Austin to live
    with her son, Eugene J. Kelly. Except for the
    property located in Alhambra, California, her
    estate consisted entirely of stocks and bonds,
    all of which she had delivered to her son,
    Eugene J. Kelly, and gave him a power of attorney
    with full authority to manage and control all
    of said stocks and bonds.
          .      I



-   .-.




              Hon. Robert S. Calvert, page 3 (W-277)     .   .’


                                     Mrs. Clara Sabrina Kelly, by
                        instn;uhe&'dated September 21, 1943,
                        executed an elaborate trust agreement In
                        which she designated her son, Eugene J.
                        Kelly, as her trustee, with full power
                        over her entire estate to manage and con-
                        trol the 88186 for her benefit during her
                        lifetime, and in this ‘GNst agreement she
                        reafflrmed her will which had previously
                        been made. In the latter part of 1943,
                        Mrs. Kelly went back to California, she
                        being then past eighty-three years of age,
                        and never left Alhambra, California, until
                        her death; after her death her body was
                        taken to Ohio for burial.
                             "By instrument dated May 11, 1949, Mrs.
                        Clara Kelly revoked her will and stated that
                        it was her full and deliberate Intention not
                        to have any will In effect at the date of
                        her death; so far as we have been able to
                        ascertain this instrument of revocation
                        was the last legal instrument ever signed
                        by her.
                             II. . .

                             "Probate proceedings were filed in Travis
                        CounCy under Section 180 of the new Probate
                        Code, for the purpose of having the court de-
                        termine that no necessity existed for adminis-
                        tration and also for the purpose of declaring
                        the helrshfp of Clara Sabrina Kelly. This
                        action was taken solely for the purpose of pro-
                        viding a vehicle for the transfer, or sale, of
                        the stocks and bonds which were carried in the
                        name of Rugene J. Kelly, Trustee, for the estate
                        of Clara S. Kelly. We Court found that no
                        necessity existed fox.administration and found
                        also that the estate belonged to the two
                        daughters in Ohio and the son in Texas, share
                        and share alike.
                             "Since the latter part of 1943, all business
                        transactions concerning the stocks and bonds be-
                        longing to Mrs. Clara Sabrina Kelly have taken
                        place In Austin, Travis County, Texas, and such
                        transactions have been handled by her son,
Hon. Robert S. Calvert, page 4 (WW-277)   /


          Eugene J. Kelly. The stocks and bonds
          were kept in a safe deposit box at the
          American National Bank, In Austin, and
          all dividend8 were payable to Eugene J.
          Kelly, TNStee.   All Income tax returns
          were filed by the son with the Internal
          Revenue Department in Austin, Texas.
          /m ese income tax returns showed the
          residence of the beneficiary of the trust,
          Mrs. Kelly, as being Austin,Texasif All
          bills of Mrs. Clara Sabrina Kelly were
          forwarded to Eugene J. Kelly, in Austin,
          Texas, and payment made through a bank ac-
          count established and maintained in the
          American National Rank in Austin.
               "We have been unable to find any
          written evidence of an Intention on the
          part of Mrs. Clara Sabrina Kelly to re-
          turn to Austin, Texas, and in talking
          with neighbors in Alhambra, California,
          we have been unable to find any statement
          by her expressing such intention."
          We have been furnished with the following instru-
ments*
of Cita~~lnApplication to Probate Court; (2) Two Yc$veTrs
           ; (3) Copy of Order of Probate Court;      wo
copies of Power of Attorney; (5) Copy of Trust Agreement;
and (6) Copy of Revocation of Will.
          The application to the Probate Court states that
the decedent died while in the State of California and
at the time of her death had her resident in Travis County,
Texas.
          The trust instrument embodied a will (subsequent-
ly revoked) in which the decedent recited that she was a
resident of the County of Los Angeles, State of California.
          The Power of Attorney likewise recites that the
decedent was a resident of Alhambra, California. The
Revocation of Wills executed at Alhambra, California,
May 11, 1949, contains no recitation as to residence.
          Article 7117, Vernon's Civil Statutes, reads,
in part,as follows:
            .
_   .-




         Hon. Robert S. Calvert, page 5   (WW-277)


                        "All property within the jurisdiction
                   of this State, real or personal, corporate
                   or incorporate, and any Interest therein,. . .
                   whether belonging to inhabitants of this
                   State or to persona who are not lnhabi-
                   tants. . . which shall pass . . . by the
                   laws or ,@g   descent or distribution. . .
                   shall upon passing . . . be subject to a
                   tax. . . in accordance with the following
                   classification; provided, however, that the
                   tax imposed by this Article in respect to
                   personal property of non-residents (other
                   than tangible property having an actual
                   situs in this State) shall not be payable:
                   (1) if the grantor or donor at the time of
                   his death was a resident of a State or
                   territory of the United States which, at
                   the time of his death, did not Impose a
                   transfer or inheritance tax of any character
                   fn respect of personal property of residents
                   of this State (other than tangible personal
                   property having an actual situs in said
                   State); or (2) if the laws of the State
                   or territory of the residence of the grantor
                   or donor at the time of his death, contained
                   a reciprocal provfsion under which non-
                   residents were exempted from transfer or
                   inheritance taxes of every character in
                   respect to personal property (other than
                   tangible personal property having an actual
                   situs therein) provided the State or terri-
                   tory of residenoe of s-uchnon-residents
                   allowed a similar exemption to residents
                   of the State OP terrltorJ of residence of
                   such a grantor or donor.'"
                   Stock and bonds are intangible personal property.
         Since California does not tax the Intangible property of
         non-resident decedents who were residents of a State or
         Territory of the United States, no taxes would be due
         the State of Texas in this case if Mrs. Kelly was domiciled
         in California at the time of her death.
                   me following definition of 'domicile" is given
         In 28 C.J.S. 1, Domicile, Sec. 1:
                        "Domicile is the legal conception of
                   home, and the relation created by law be-
                   tween an individual and a particular
Ron. Robert S. Calvert, Page 6(w-277)


          locality or country. The term has been
          variously define& the definitions agree-
          ing substantially on the elements of a
          true,Sixed home, habitation or abode,
          where a person intends to remain permanently
          or IndefInItely, and to which, whenever
          absent, he intends ,toreturn."
          The above definition was uoted by the Court in
Stone v. Phillips, 171 S.W. 2d 156 Tex. Civ. App. 1943,
aSSrd'9   2 Tex. 216, 176 S.W. 2d %     1944).
                                    322
                                   .-
          The acquisition of a domicile  of choice is en-
tirely a question of residence and intention. In other
words, to have effected a change of domicile from Ohio
to California there must have been an actual residence in
California and an intention on the part ,oSMrs. Kelly to
remain there or to mske it he' home. It is not necessary
that the Intention to acquire a new domicile should exist
at the time of initial residence,but such intention may be
formed thereafter. Tne foregoing general principles are
supported by the authorities contained in 28 C.J.6. 11-14,
Domicile, Sec. 9.
          Assuming that the Sacts which have been furnished
you are true, it appears to us, primarily from the fact
that Mrs. Kelly was in Texas, living in the home of her son,
for less than a year, that Mrs. Kelly was a resident of
California; hoPever, the Sac,tsare sufficiently conflicting
in this case that we cannot say as a matter of law that Mrs.
Kelly was domiciled in CaliFornia.  This office does not
pass upon questions of fact.
          IS you shoulc1determin? that Mrs. Kelly was domicil-
ed in California, we have o~nciuG!o that you would be author-
ized to ref+unci
               the money in view of the provisions of Article
4308, V.C.S., which xsads fn part as follows:
               "The State Treasurer shall receive daily
          Srom the head of each Department, each of
          whom is speciall;rcharged with the duty of
          making sane daily, a detailed list of all per-
          sons remitting money the status of which is
          undetermined or which is awaiting the time
          when it can finally b,ataken into the Treasury,
                   vkth the actual rexittancr which the
          togetJh..er
          Treasurer shall cash antiplace in his vaults
          or 9n legally authorized d,ePositorybanks,if
          the necessity arises. . . 0 A deposit receipt
          shall ‘beissued by the ComPtroller forthe
         -,      .
. . .-




              Hon. Robert S. Calvert, sage 7(m-8’7)


                          daily total of such remittance from each
                          Department; and the cashier of the
                          Treasurer's Department shall keep a cash
                          book, to be called lsuspense cash bcok,'
                          in which to enter these deposit receipts,
                          and any others issued for cash received
                          for which no deposit warrants can be issued,
                          or when their issuance is delayed. As soon
                          as the status of money zo placed with the
                          Treasurer on a deposit receipt is determined,
                          it shall be transferred from the suspense
                          account by placing the portion of it belong-
                          ina to the State in the treasury by the
                          issuance of a deposit warrant, and-the part
                          found not to,belong to the State shall be
                          refunded." (&phasis supplied)
                                     CONCLUSION
                        Since this office does not pass upon questions
              of fact, and since in this case the submitted facts per-
              taining to the decedent's domicile are conflicting, we
              are unable to advise you as to the domicile of the dece-
              dent. Should you determine that the decedent was domiciled
              in California, you would be authorized under Article 4388,
              V.C.S., to refund the inheritance taxes heretofore paid.
                                              Very truly yours
                                              WILL WIisON
                                              Attorney General
                                              By:                          */

              MMP,'fb                               Assistant
              APPROVED:
              OPINION COMMITTEE
              George P. Blackburn, Chairman
              W. V. Geppert
              B. H. Timmins
              John B. Webster
              REVIEWED FOR THE ATTORNEY GENERAL
              Ey: James N. Ludlwn
