Estate of Franko v. Director, Division of Taxation

KUSKIN, J.T.C.

In this matter, plaintiffs appeal an assessment of New Jersey transfer inheritance tax imposed by defendant Director of the New Jersey Division of Taxation (the “Director”). Plaintiffs’ principal contention is that a trust (the “Trust”) established under the Will of decedent, Catherine Franko (“Mrs. Franko”) created a life estate for the benefit of her surviving husband, Charles R. Franko (“Mr. Franko”). Plaintiffs further contend that, because a bequest to a spouse is not taxable under N.J.S.A. 54:36-2 (setting forth transfer inheritance tax rates), the value of Mr. Franko’s…