§ 13441. Property Left in Two or More States.

(a) Apportionment.

In a case where a decedent leaves property having a situs in this State, and leaves other property having a situs in another state, or other states, the portion of the maximum state death tax credit allowable against the federal estate tax on the total estate by the federal estate tax law which is attributable to the property having a situs in California shall be determined in the following manner:

(1) For the purpose of apportioning the maximum state death tax credit, the gross value of the property shall be that value finally determined for federal estate tax purposes.

(2) The maximum state death tax credit allowable shall be multiplied by the percentage which the gross value of property having a situs in California bears to the gross value of the entire estate subject to federal estate tax.

(3) The product determined pursuant to subdivision (2) shall be the portion of the maximum state death tax credit allowable which is attributable to property having a situs in California.

(b) Additional Tax Imposed.

If the inheritance tax imposed by this state is less than the portion of the maximum state death tax credit allowable which is attributable to property having a situs in California, as determined in subsection (a) of this regulation, an additional tax will be imposed in an amount equal to the difference between the portion of the maximum state death tax credit attributable to property having a situs in California and the normal inheritance tax imposed by this State.

(c) Copy of Federal Estate Tax Return.

In a case where a decedent leaves property in two or more states, and an additional tax is imposed by California, a copy of the Federal Estate Tax Return (form 706) must be submitted to the inheritance tax referee or the appropriate district office of the Inheritance and Gift Tax Division.

(d) Time of Payment.

As to time of payment and delinquent date for payment of additional tax, see Section 14103(c).

The provisions of this regulation are illustrated by the following example:

EXAMPLE: Decedent died a resident of California. At date of death, decedent was possessed of personal and real property in California and real property in State X. For California state inheritance tax purposes, the real and personal property in California is valued at $10,500,000, and the total of allowable deductions is in the amount of $1,250,000, resulting in a net taxable estate (clear market value) for state inheritance tax purposes in the amount of $9,250,000. Under the terms of decedent's will, the entire estate goes to four adult children in equal shares. The inheritance tax due with respect to the share going to each child is, therefore, $302,350; and the total normal inheritance tax is $1,209,400 ($302,350 x 4).

For federal estate tax purposes, the gross value of the total estate is $25,000,000; and the gross value of the personal and real property in California is $10,000,000. The total of deductions allowable for federal estate tax purposes is $1,500,000, resulting in a net taxable estate in the amount of $23,500,000. The maximum state death tax credit is $3,226,800.

The additional tax is $81,320, determined as follows:
Federal estate tax net taxable estate	$23,500,000
Maximum state death tax credit to be apportioned	$3,226,800
Gross value of total estate (FET values)	$25,000,000
Gross value of California estate (FET values)	$10,000,000
Percentage of gross federal estate having a situs
in California ($10,000,000/$25,000,000)	40%
Portion of maximum state death tax credit
attributable to property having a situs in
California (40% x $3,226,800)	$1,290,720
California normal inheritance tax	1,209,400
Additional tax due	$81,320

Note

Note: Reference: Section 13441, Revenue and Taxation Code.