California Code of Regulations
Title 18 - Public Revenues
Division 2.5 - State Controller
Chapter 1 - Inheritance Tax
Article 2.1 - Imposition and Computation of Additional Tax
Section 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:

(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.

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