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stated in the will and codicil. Petitioner stresses that
decedent dealt with her daughter in a businesslike manner, even
in personal matters which involved money. Petitioner believes
that the only two possible interpretations that respect
decedent's intent as to the stock are a condition precedent or an
option to purchase. In either event, petitioner argues that the
doctrine of probable intent requires us to construe the will in a
manner that maximizes the marital deduction, citing In re Estate
of Erickson, 74 N.J. 300, 377 A.2d 898 (1977).
2. New Jersey Law
As a general rule, State law determines the property rights
and interests created by a decedent's will, but Federal law
determines the tax consequences of those rights and interests;
E.g., Morgan v. Commissioner, 309 U.S. 78, 80 (1940). Because
decedent died a resident of New Jersey, the parties agree that
New Jersey law governs the construction of her will. See
Helvering v. Stuart, 317 U.S. 154, 162 (1942). The decisions of
the Supreme Court of New Jersey are conclusive as to that State's
law, but we give "proper regard" to relevant rulings of the lower
State courts. Commissioner v. Estate of Bosch, 387 U.S. 456, 465
(1967). For petitioner to receive a marital deduction for the
value of the agency stock, it must establish that the stock
passed from decedent to the surviving spouse. The resolution of
this threshold issue depends on the interpretation of the phrase
"I give, devise and bequeath all of my stock * * * to my
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