can be ascertained and determined, on evidence, by a court, a suit for the tax will lie without an assessment. United States v. Tilden (28 Fed. Cas., 161; No. 16519); United States v. Hazard (26 Fed. Cas., 251; No. 15337); Dollar Savings Bank v. United States (19 Wall., 227); United States v. Chamberlain (219 U. S., 250-264); King v. United States (99 U. S., 229); United States v. Reading R. R. (123 U. S., 113); United States v. Cobb (11 Fed., 76); United States v. M. H. and O. R. Co., [W. D. Mich.] (17 Fed., 719; 22 Cyc., 1670, and cases there cited); Eliot National Bank v. Gill (210 Fed., 933, affirmed by the Circuit Court of Appeals of First Circuit, December 21, 1914). The demurrer will be overruled and the defendant will be given 15 days within which to plead to the declaration. FEBRUARY 25, 1915. (T. D. 2167.) Expenses of office and field deputy United States marshals incurred in raiding for violations of the internal-revenue laws. Office deputy marshals may be reimbursed their actual necessary expenses up to the time of making arrests, subject to the limitation of $5 per day (T. D. 1873 of Aug. 31, 1913), provided they are engaged exclusively on internal-revenue business. Field deputy marshals may be allowed compensation not to exceed $5 per day (T. D. 1873) for services as possemen or guides, inclusive of their actual necessary expenses, but when an arrest is made only claim for expenses actually incurred up to the time of making the arrest can be paid from the appropriation made for the Internal-Revenue Service. TREASURY DEPARTMENT, OFFICE OF COMMISSIONER OF INTERNAL REVENUE, Washington, D. C., March 1, 1915. To internal-revenue agents and others concerned: For your future guidance in submitting claims of deputy marshals for compensation for services rendered as possemen raiding illicit distilleries the following regulations are promulgated by this office: Office deputy marshals may be reimbursed their actual and necessary traveling expenses incurred while accompanying revenue officers in raiding illicit distilleries up to the time of making an arrest, subject to the limitation of $5 per day, provided the deputies are engaged exclusively on internal-revenue business and not traveling to serve process or on other official business connected with the marshal's office. Their claims on Form 10 for reimbursement must be accompanied by their certificate showing that they were engaged exclusively on internal-revenue business, such certificate to be approved by the marshal. Field deputy marshals are allowed compensation not exceeding $5 per day for services as possemen or guides, such compensation to include their actual and necessary expenses incurred on the raid. In cases where the deputy marshal makes an arrest while on a raid his claim for that day should be only for expenses actually incurred up to the time of making the arrest. The certificate of the marshal, which should always accompany the claim on Form 10 to this office, should state in all cases the period of time during which the deputy marshal received no fees or expenses for services rendered to the office of the marshal. Special-tax liability as liquor dealer. Advertisements of whisky shipped on approval should have approval feature modi fied or eliminated. TREASURY DEepartment, OFFICE OF COMMISSIONER OF INTERNAL REVENUE, Washington, D. C., March 5, 1915. To internal-revenue officers and others concerned: The attention of this office has been directed to the advertisements of numerous whisky houses offering to ship, on order, whisky, and if upon trial the same is not satisfactory it may be returned and money refunded to the purchaser. In the opinion of this office these terms constitute merely a conditional agreement which does not become a binding sale until the consignee examines and accepts the goods, and then constitutes a sale at the place of such acceptance. In order to avoid assertion of special-tax liability as liquor dealer at the various places where such acceptances occur, all such advertisements should be modified so as to eliminate this feature. DAVID A. GATES, Acting Commissioner of Internal Revenue. (T. D. 2169.) Emergency revenue law-Bills of lading. Stamp tax on bills of lading must be paid by the shipper-Ruling of the Interstate Commerce Commission. TREASURY DEPARTMENT, OFFICE OF COMMISSIONER OF INTERNAL REVENUE, Washington, D. C., March 2, 1915. SIR: The question was raised by the assistant general counsel of the Central Railroad of New Jersey on a ruling by this office in T. D. 2113, paragraph 4, that the carrier might pay for the stamp on bills of lading, stating that such ruling was contrary to law and in violation of the interstate commerce act. The matter was referred to the Interstate Commerce Commission. It appears from their decision that the carrier can not assume any burden that properly belongs to a shipper, except in such a way as to place all shippers upon an equal footing, and that it would be unlawful for the carrier to provide the stamp without cost to the shipper. The ruling of this office is therefore modified in accordance with such decision of the Interstate Commerce Commission, and you will notify Mr. accordingly. It is held that the shipper or consignor should pay for the stamp required on bills of lading, but there is no objection to the carrier affixing and canceling the stamp as agent of the consignor. OFFICE OF COMMISSIONER OF INTERNAL REVENUE, To collectors of internal revenue and others concerned: The following rulings have recently been made by this office with reference to the provisions in the act of October 22, 1914, imposing a tax on "promissory notes, except bank notes issued for circulation, and for each renewal of same, for a sum not exceeding $100, 2 cents; and for each additional $100 or fractional part thereof in excess of $100, 2 cents": (1) In view of the decision made by the Supreme Court of the United States in the case of the United States v. Isham (17 Wall., 496), that "the liability of an instrument to a stamp duty, as well the amount of such duty, is determined by the form and face of the instrument, and can not be affected by proof of facts outside of the instrument itself," this office is of the opinion that drafts, acceptances, overdrafts, and post-dated checks are not taxable under the above act as promissory notes, even though they are used in such a way as to perform some of the functions of a promissory note. (2) A contract or agreement extending either a chattel or real estate mortgage is not taxable, but if such extension effects the renewal of promissory notes, either embodied in the mortgage or given in connection with the mortgage, the renewal of such notes is taxable under the above act. (3) This office has received several inquiries regarding the taxability of contracts for the purchase of pianos, machinery, and other merchandise, in which among other conditions and provisions there is included an agreement to pay the vendor a stipulated sum of money at a certain time, with interest, for value received. If, in such contracts, this agreement is in form and effect a good and valid promissory note, upon which the maker would be liable in a suit at law, such promissory note is taxable under the above act. If, however, the contract merely provides for the payment of the purchase price in installments and enumerates the dates upon which such payments are due, stating, as many of the contracts do, that in default of payment the vendor may take the property, such agreement is not a promissory note. (4) A promissory note drawn in a foreign country and placed in the mails in that country for delivery to a person residing in the United States is not taxable under the above act. Delivery of commercial paper is necessary for its completion, and by the weight of authority such an instrument is delivered when placed in the mails. The laws of the foreign country, therefore, would determine the validity of the contract, even if the instrument is made payable in the United States. On the other hand, a promissory note drawn in the United States and placed in the mails for delivery to a person residing in a foreign country is taxable, for the reason above stated. (5) A receipt given by a loan company for property received as security for a debt is not a promissory note; but, if in the receipt there is included a promise to pay a certain sum of money at a specified time, with interest, for value received, such a provision, in the opinion of this office, is a valid promissory note, upon which the maker would be liable in a suit at law and is taxable. DAVID A. GATES, Acting Commissioner of Internal Revenue. (T. D. 2171.) Legacy taxes-Decision of the Supreme Court. 1. REPEAL OF THE LEGACY TAX. The tax on legacies imposed by the war revenue act of 1898 was repealed by the act of April 12, 1902, taking effect July 1, 1902. 2. ACT OF JUNE 27, 1902. No tax was assessable on legacies which had not become absolutely vested in possession or enjoyment prior to July 1, 1902. 3. REFUND OF TAX. Where the testator died May 24, 1902, and under the State law payment of legacies could not be demanded until the expiration of a year, legacy taxes collected before that time were collected on contingent interests not absolutely vested and should be refunded. 4. CASE OF UNITED STATES v. JONES. The decision of the Supreme Court in United States v. Jones (236 U. S.; T. D. 2138) applicable. TREASURY DEpartment, OFFICE OF COMMISSIONER OF INTERNAL REVENUE, Washington, D. C., March 5, 1915. The appended decision of the United States Supreme Court in the case of William McCoach, collector, etc., petitioner, v. Dundas F. Pratt et al., executors, etc., is published for the information of internalrevenue officers and others concerned. DAVID A. GATES, Acting Commissioner of Internal Revenue. SUPREME COURT OF THE UNITED STATES. No. 149. OCTOBER TERM, 1914. McCoach, collector, etc., petitioner, v. Pratt et al., executors, etc. ON WRIT of certiorari to the United States Circuit Court of Appeals for the Third Circuit. [March 1, 1915.] Mr. Justice VAN DEVANTER delivered the opinion of the court: Whether a succession tax collected under sections 29 and 30 of the act of June 30, 1898 (30 Stat., 448, 464, c. 448) shall be refunded is the matter here in controversy. The facts bearing upon its solution are these: Ferdinand J. Dreer, a resident of Philadelphia, Pa., died May 24, 1902, leaving a will directing that certain legacies be paid out of his personal estate to two sons and two grandchildren. The executors took charge of the property and proceeded to administer it under the supervision of the orphans' court, as the local law required, first for the benefit of the creditors and next for the benefit of the legatees. The former had a year within which to file their claims and the latter were not entitled to demand payment of the legacies until that time expired, and then only in the event there was a residue available for the purpose. Jones's Appeal (99 Pa., 124, 130); Rastaetter's Estate (15 Pa. Sup. Ct., 549, 553–555). On July 1, 1902, a date the importance of which will be seen presently, less than two months of the prescribed year had passed, and whether there would be a residue for the payment of legacies was as yet undetermined. In July, 1903, the collector of internal revenue demanded of the executors a succession tax of $1,692.75 on account of the legacies and the tax was paid under protest. Shortly thereafter the executor sought, in the appropriate way, to have the tax refunded, but the request was denied, and they then sued the collector to recover back the amount. In the Circuit Court the executors prevailed and the judgment was affirmed by the Circuit Court of Appeals (201 Fed., 1021). By section 29 of the act of 1898 an executor, administrator, or trustee having in charge a legacy or distributive share exceeding $10,000 in actual value, arising from personal property and passing from a decedent to another by will or intestate laws |