                                                                                      393




             OFFICE     OF THE       ATTORNEY     GENERAL     OF   TEXAS
                                         AUSTIN



,Honorable    J. F. Lindsey
Assistant     County Attorney
Jones    COllIlty
~nabn,     Texes




                                                            ear es per

              You     submit   for    th                    Is department the quee-
tion     aontalned     in go                                reading as rollowsr
                                                            lnlon or eny aopl8a
                                                            Ing the lnterpra,
                                                             Statutes of Texas4
                                                Under Art. 7165, R..C. S.,
                                                 atement at the..a$ose of'
                                                  wpald dlvldendr In the sum
                                                   dpens ror business on
                                             da have been paid out to the
                                           la $12,500.00   be assessed ror
                                           lng January lst,   as personal

                          presented la.'whether the $l)12,5OO.OOreileat-
                        etement of the bank as ot Deoember 31, as
                     stltutes    personal property to be eooounted for
by the bank under the provisions      of Artlale 7165, R. 0. 9. or
whether or not ei of ranuary     1, these dividends had been paid to
the stookholders,  and hence oonatituted      peraonal property in the
hands of the stockholders.      Artlole 7165, R.C.S. reads as rpllows:

               *Every bank,      whether of Issue or deposit,    banker,
         broker, dealer in       exohange, or stook jobber,   shall at
         the time fixed by       this ohapter for listing   personal
         property, make out       and furnish the 8saeaaor of taxes
         a sworn statement       showing:
                                                                     394

tfonorsble   J. F. Lindsey,   Page 2


            9.    If a national bank, the president -or some
      other oiilcer   of auoh bank shall furnish to the aa-
      aessor of the oounty in whloh euoh bank 1~ located a
      list of the names of ell the shareholder8 of the stoak,
      tOgether with the number and amount of the shares of
      eaoh stockholder   or stook in said bank; and the ahare-
      holders of the atook in national banka shall render to
      the tax aasesaor of the oounty in whioh said bank la
      looated the number of their shares and the true and
      lull value thereor.     All aharea of stook in national
      banka not rendered to the asses&or of taxes ln.the ooun-
      tg where such bank is looated within the time presorlbed
      by law for listing    property for taxes shell be aeseeeed
      by the assessor egalnet the owner or owners thereof
      as unrendered property la. eaaeeeed; but the tax roll
      shell show the name of the owner or ownera thereof a8
      per staterctint rurnlshed by the president or other ot-
      rlaers of said bank.
            “2.  National banks shall render all other bonda end
      stook of every kind, exoept United States bonds, and all
      shares of capital   &oaks or joint   atoak or etooks of
      other oompanlea or oorporations    held as an investment
      or in any way representing   assets,   together with all
      other personal property belonging or pertaining     to said
      benk, exoept euoh .pereonal property aa le epeoially
      exempted rrom taxation by the laws of the United Statea.
            “3.  National ban& shall be required to render all
      of their real e&ate aa other real estate    I8 rendered;
      .and all the personal property of aald national banks here-
       in taxed shall be valued a8 other personal  property la
      valued,

            “4.   All other banks, bankere,   brokers, or dealer8
      in exchange, or etoak jobbers shall     render their list in
      the following   manner:
             “(1) The amount of money on hand or in transit or
      in the hands of other banks, bankers, broker8 or others
      subjeot to drart, whether the same be in or out of the
      State.
           “(2) The amount of bills   reaelvable, dlsoounted or-
      purohased and other oredlta due or to beootie due, lnolud-
      lng aooounta reoelvable;  lntereefi aoorued but not due,
      and interest due,and unpaid.
             “(3) Fran the segregate amount of the items
      named in the rlrst and seoond of the last two SUbdi-
      visions shall be deduoted the amount Or money on depoeit.
                                                                       395

Ranorable J. F. Lindsey,   Page 3


            n(4) The amount of bonds and atooks of every kind,
     exoept United Statea bonda, and all sharea of oapltal
     atooks or joint stooka of other oompanlas or oorpora-
     zi;t;ahald   a8 an investment or in any way representing
              .
           “(5) All other property belonging or appertaining
     to aald bank or business,   lnaludlng both personal prop-
     erty and real estate,  shall be listed  aa other personal
     property and real estate.”
            It la observed that the flrat three aubdfvlslona      of said
artlole   apply exalualvely to national    banks.  Subdivlelon No. 4
applies to *all other banks”.    Artlale 7166, R. C. S., 1925, ia
applloable   to every banking aorporation,    State or National, and
providea for the rendition   of real estate owned by the banka, end
ror the manner or aaaeaament of real eeteta of the bank, and or
the ahares of stook owned by its etookholdera      in the following
language t
           TWery banking aorporatlon,     State or national
     doing business in this State ahall, In the oity or
     town In whlah It 16 looated,    render ita real eetete.
     to the tax aaaaasor at the time and in the manner re-
     quired of individuals.    At the tlme Of making auoh
     rendition  the president or some other orrlaer or eaid
     bank shall rile with said aaaeasor e aworn etatement
     showing the number and amount of the aharea of aeld
     bank, the name and realdenae of aaah ehareholder,      and
     the number and amount of aharee owned by him. Every
     aharaholder or said bank shall,    in the oity or town
     where said bank la looated,    render at their eatual
     value to the tax aaeesaor all shares owned by him in
     auoh bank; and In oaae of his iallure      ao to do, the
     assessor shell aaaaea auoh unrendered share8 aa other
     unrendered property.    Each share in auoh bank shall be
     taxed only for the dirrarenoe    between’ite   aotual oash
     value and the proportionate    amount per share at whloh
     its reel estate la aaaeased.     The taxes due upon the
     shares or banking oorporatlons    shall be a lien thereon,
     and no banking oorporatlon   ehall pay any dividend to
     any shareholder who la in derault in the payment of
     taxes due on his shares; nor shall any banking oor-        _
     poration permit the transfer    upon ita books of any
     share, the owner of which is In default in the pay-
     ment of his texea upon the same. Nothing herein shall
:’                                                                     .:’   396   i:

     Honorable J. F. Lindsey,   Page 4


          be so oonstruad as to tax national or State banks, or
          the shareholders thereof, at a greater rate than la
          assessed against other moneyed oapital in the hands
          or. lndlvlduals.n
               Under the two toregoing   artlolea, namely, 7165, 7166,
     supra, it is observed that real property of a bank is taxed a-
     gainst the bank, while the personal property is taxed against
     the shareholders.   City of Marshall v. State Rank of Marshall,
     127 S. W. 1083 (error refused),   6 Tex. Jur. 346, at seq.
                We are constrained      to the view, under the faota sub-
     mitted by you, that the $12,500.00 rerleoted        In the bank’s
     statement as dividends,      is personal property taxable to the
     iddlvldual  shareholders,     regardless  of whether or not it had aa-
     tually been paid out on January 1 to the ahareholdere as dividends,
     for the reason that it had been set aside by the‘bsnk ror the pur-
     pose of paging the dividends and no longer oonstltuted        an aeaet of
     the bank. If It had aatually        been paid to the atookholdera,  or
     your letter lndloates,     it would be treated ior the purpose of taxa-
     tion Ii in the hand8 oi the shareholders        on January 1, as any other
     oesh aseeaaed by the shareholders.        If it had not been aotually re-
     aelvad by the shareholders,      it constituted   a oredlt in favor of the
     shareholders and a debit agalnat the surplus or undivided profits
     of the bank. If the dividends had passed into the handa or the
     etookholdera on January 1, auoh dividends had been reduaed to own-
     ership and possession     in i&e hands of the shareholdere,    and elnoe.
     In any event it had been sat aside by the bank, presumably agalnet
     surplus or undivided profits       out of which It oould be legally
     paid, and oonstltuted     a taxable asset in the hands of the stook-
     holders.
                You are therefore  reapeotrully  advised that It is our
     opinion that this item or dividends in the sum of $12.500.00 Is
     not to be taken into eoaount by the bank as of January 1 In render-
     ing its atatament to the assessor ror the purpose of aesesament se
     provided in the two foregoing   artiolea,  but that it merely-aonatl-
     tubs   an asset to be rendered by the individual    stookholders in
     his assessments, if in raot it was on hand as of January 1, either
     as a oredlt in his favor in the bank, or by having aotually been
     rsoelved by suoh stookholdar and In his hsnds on January 1.
                                                Very truly   your6

                                           ATTORNEYGENRRAL OF TEXAS
