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HEINER V. DONNAN, 285 U. S. 312 (1932)

U.S. Supreme Court

Heiner v. Donnan, 285 U.S. 312 (1932)

Heiner v. Donnan

No. 514

Argued February 26, 1932

Decided March 21, 1932

285 U.S. 312


1. The second sentence of § 302(c) of the Revenue Act of 1926, which creates a conclusive presumption that gifts made within two years prior to the death of the donor were made in contemplation of death, requiring the value of such gifts to be included in computing the value of the estate of the decedent subject to the graduated death transfer tax, and thus burdening the estate beneficiaries because of acts bearing no relation to the estate or to death as the generating cause of its transfer, violates the due process clause of the Fifth Amendment. Schlesiger v. Wisconsin, 270 U. S. 230; Hoeper v. Tax Commission, 284 U. S. 206. P. 285 U. S. 322.

2. A statute which imposes a tax upon an assumption of fact which the taxpayer is forbidden to controvert is so arbitrary and unreasonable that it cannot stand under the Fourteenth Amendment. Schlesinger v. Wisconsin, 270 U. S. 230. P. 285 U. S. 325.

3. The restraint imposed upon legislation by the due process clauses of the Fourteenth Amendment and the Fifth Amendment is the same P. 285 U. S. 326.

4. The claimed necessity of preventing frauds and evasions of the death transfer tax cannot justify the otherwise unconstitutional exaction imposed by the statute; the constitutional rights of the individual are superior to this supposed necessity. P. 285 U. S. 328.

5. The conclusive presumption created by the statute is invalid, whether it be treated as a rule of evidence or of substantive law. Id.

6. Section 302(c) cannot be sustained as imposing a gift tax (1) because the intent of Congress to enact the provision as an incident of the death tax is unmistakable, and, (2) as a gift tax, it would be arbitrary and capricious, in violation of the due process clause of the Fifth Amendment. P. 285 U. S. 330.

Certificate from the Circuit Court of Appeals upon an appeal from a judgment of the District Court against the Collector on a claim for refund of taxes alleged to have been illegally exacted. 48 F.2d 1058.

Page 285 U. S. 320

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