Untitled Texas Attorney General Opinion ( 1942 )

f. OFFICE OF THE ATTORNEY GENERAL OF TEXAS AUSTIN Bonorablo (kcrgo H. Sheppard Cosptroller OS Fublfe 4icounts Austin, Tbxas Dosr Sir! opinion Ho. o-431 Rat Where the own , 1948, rubnits for our apinion tha r0 lcihw8 quote th*rerrall1 lrofl,f.+oQ ahavm be&i0 aorporatlan. a new 00rtirht8*to *Mr. e bnd benefit of the oem- ‘If taxable, in the tax myablo on the on- tire tranmmtien or on one-haU?m Seotion 1 or the above-olted Staak TruPsier lU lax levies and iqmser a 8tated tax on %I.1 a&es, agne- mnts to nell,,or mmorenda St raleo, and all dellrwies or tnristers et shares, OF oertltiaatbs 02 stock, or QOP- tlriaetm ror rfghta to stooek,or oertlileatr8 o# lepoalt reprwenting an intarest in or npreaentllrg oertifioates made taxable under this Seation in any domestie Or foreign r 9. ._,;, .=, : hcc.pard, Fage 8 assoolatlon, oompany or oorpratlon )-* * whether made upon or ahown by the booka of tha assoalatlon, acmpany, oorgora- tion or trustee. or by my a~algnmant in blank or by any delivery of any paper8 or egreenent or memorandumor other lvl4anoe of sa leor transfer or order for o r lgroemnt to buy, whether intermediate or final, an4 whether investing the holder with tha beneficial lntereat In or lagal title to suoh *took or other oertlfleate taxable hereunder, * * ** Thla departsant has hold, in our Gplnlons 34r. O-3%0, G-3113 an4 O-4089, that the intent ef this Aot IS& the above seotlon thereor was to levy or 16ppoab an exolae or privilege tar upon the transfer, b aale or girt of ahana or oertlfieatea or stook, vaat 1ng in the ten&e, tramieree or donae, either the legal or equitable title therein and thsrbto. Althowh pur opinion nqusat ia silent upon the question the legal or equitable title to the share8 or atoak lnvoired ray have been transrerrea, or attampted to be transferred, fn two poaslble raf6, via, (1) by an attempted gift of the husband'8 aeparata estate In the 8took to the oOmu8itJ eatate Of huaband and alte, or, (2) b;lthe tran8fW of atook from the separate b8tate of the huabaml to the ocmmunlty satate of huaband an4 rite, not as a gift, but 5.n oonalderatlon of the payment to the husband or oomrmuity run48 or ths donreyanea 0r 44inmnity property. Ii, aa It presumptively appoara, the husband at- tenptad, bp gift, to tmnaicr an4 aeoiga hla adrelbtrdly separate esteta In thla atcok to ths oamunlty eatate of hiniaelran4 *Ifs, his purpose and effort to this en4 was una~alllng, and neither legal nor equltablo title in the nolety vested in the wife 80 aa to conatltute a taxable transaction under the opinion8 aaverted to. The nature or the oommual~y property asat+o in Texas ia luoh that one spouas cannot donate or give prowrty ot MS kln4 or ohsr- acter rrom hia or her separate estate In an attempt to eonatltute the aam the ommunlty property of both. Howevet, if c-unity funds or roperty are advanoed or exchan@d in consl4erstlon for tge sale cf aeparate property to the oornunnityestate, it arpearo that such tranaaotlon Is rau- wnlzed a8 aocompllahing this purpose. L *The ccmnunity ratate la a ere8tum Ot law and not cf oontraot or oonv~nt~on. It UM *Xi& ?ronorable George H. Eheppard,Page b only as the creature of statute. Not OnlT ean the estate as auoh exiot only bp law, but the parties are not perm%tted by agreement between theawlvcs to ahang the oharaoter ai acquisi- tions tram sexrats to 0066ualty, or vloe versa, fron:oormunlty to soparato roporty. Duoh agres- c.eltts,if pemitted, night i astroy the statute and, through unorrtainty, work untold 618ohlei to the rights of purehaaers or aredltora deal- ing with the husband or the proparty * + *n &An, In suotalning our a4noluaion that separate ol either spouse IMAXnot, by girt, beoaaa aaamunit~ of both, although, ooimmlty property may, by &it, bee&e iepamte property of eaoh apoutse, we point to the fob ImIng well.-at&c& diotlnctlon batueaa separate and acmwiltf proportj: me * * The separate estate Ie a dIatInot estate 0r atatutor~ origin an4 darlnItIos, wholly apart iron the estate of tha apouae in the oom- man propertq. The moiety ouned by eaah epouae In the aammunity ir?not a lp p a r stc esta te1it is ooemunlty until In some lawf’ulrey then has beon a disaolutlon of tha marrlaga or derolutlon of the title. Thus where the husband and wlfo ao- quin a ¥ pfaoe of property in auuh way a# to maks i.tooneunlty property, eaoh 4nn8 a onb- halr Interest therein, but such title Is in no aeaae the separate property of the ownor. Ii ona of tba spowrs should donate to tha other hIa one-half Interest in the oanmunity, such donation would undaubte4ly then baO6ma the sep- arate property Or the dooee. Put the nature et the oommunlty letate la auah--that la it8 le@l aerinltion la auoh-- that in nu event can the 8epbrbtb proportg Fe Eonated to the t?ommuDfty. feparate propert)rmay beoow o4smunltr however by purchase or exahanRe and the like, pre4laelY 8.8 any other property ne~y be acquired in auoh way as to leake St part of the oaaaunity eetate.” 1137%~. Jur., pp. W-%3. mm vi8 foregoing, ~98 conoludt that ;r tha at- tegted tranefer or the atook in question out of the separate Homrable George F?.Sheppard, “age 4 estate of the husband into the oomnunlty estate OS husband and wlfe,waa by way of gift OS donation, muse was of no fores and effeot to transfer either the legal or equitable titlr oontamplated by the Stock Transfer Tax Aot, and thare- fore no tax aooruee. If, on the other hand, the transfer or the 6tOok from the separate to the Oommunity batatc war ia aoluldsratfon CZ oommnft fund6 or ooamualt9 proprrty, then a tax would aocrue on tg e truufer to the wife of thr moi4ty. Although the wife would not prerently own or here the legal or equltab1.rt1tJ.eto BOO ahares of thim stool as would be the ease %f the trensfsr wa8 Zor hor reparate eetats and lnterent, but would hold the equitable title In one half of eaoh share of the total 1,000 sharor during aoverture, we oonolude that the tax rhould be ocmputrd on the quanta of sharer or value uhioh mhe aotually and ul- tlmtely raoelvoa, to-tit, 500 shares, rather than on tha oatate which rxirta in the total1000 aharm under the ooa- mmitp propert s9#tem during mlrrrloge. Trusting the toregaing fully aatiafle~ your ln- qulrf, w4 $2-4 Tour8 very tnal9 ATpOR?l!YOmTRAL GF TEXAS