No. 453 January Term, 1977, Appeal from the decree entered January 31, 1977 of the Court of Common Pleas of Schuylkill County, Orphans' Court Division
Leonard G. Schumack, Shenandoah, for appellant.
Vincent J. Dopko, Deputy Atty. Gen., for appellee.
Eagen, C. J., and O'Brien, Roberts, Nix, Manderino, Larsen and Flaherty, JJ. Manderino, J., did not participate in the decision of this case.
Appellant appeals from the decree of the Court of Common Pleas of Schuylkill County, Orphans' Court Division levying an inheritance tax on the estate of Katherine M. Beck.*fn1
Decedent, Katherine M. Beck, and her sister, Elizabeth Viola Johns, owned property as tenants in common at 34 South Nichols Street, St. Clair, Schuylkill County, Pennsylvania. On September 25, 1959, Beck and Johns conveyed the Schuylkill County property to themselves and their niece, Emma L. Foster. The recorded deed provided:
parties of the second part, the said Katherine Beck and Elizabeth Johns for and during the terms of their natural lives with remainder in fee, upon the death of the survivor of them to Emma L. Foster, her heirs and assigns . . .*fn2
Both prior to and after the 1959 conveyance, Beck, Johns and Foster resided at the Schuylkill County property.
On January 8, 1975, Katherine M. Beck died testate. Emma L. Foster was appointed executrix of the estate and letters of administration were granted. The executrix filed the requisite inheritance tax return, but failed to include as taxable the Schuylkill County property. On July 25, 1975, the Inheritance Tax Department of the Commonwealth of Pennsylvania appraised the value of the Schuylkill County property at $7,500.00. The Department determined that half of the property's value, $3,750.00, was subject to a 15 percent inheritance tax. The executrix appealed the $562.50 inheritance tax to the Orphans' Court. The court held that the estate was properly taxed since the 1959 inter vivos transfer was made without consideration and the transferor reserved for her life the possession and enjoyment of the property. The executrix has filed an appeal from the decree of the Orphans' Court to this court.
On appeal, appellant disputed the applicability of the Pennsylvania Inheritance and Estate Tax Act of 1961, Act of June 15, 1961, P.L. No. 373, art. II, §§ 221, 224, 72 P.S. §§ ...