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Petitioner filed a spousal property petition in the Superior
Court of California, County of Los Angeles, alleging that the
Young Property was community property. After a hearing, the
Superior Court of California, County of Los Angeles, in a spousal
property order dated October 8, 1991, found that the Young
Property was "community property or quasi-community property
belonging one-half (1/2) to each spouse and passing one hundred
percent (100%) to TSAI-HSIU HSU YOUNG, the surviving spouse."
OPINION
Issue 1: Joint Tenancy or Community Property
It has been established that what constitutes an interest in
property held by a person within a State is a matter of State
law. Fernandez v. Wiener, 326 U.S. 340, 355-357 (1945); Poe v.
Seaborn, 282 U.S. 101 (1930). In Commissioner v. Estate of
Bosch, 387 U.S. 456 (1967), the Supreme Court held that State law
as announced by the highest court of the State is to be followed.
"If there [is] no decision by that court then federal authorities
must apply what they find to be the state law after giving
'proper regard' to relevant rulings of other courts of the State.
In this respect, it may be said to be, in effect, sitting as a
state court." Id. at 465 (citing Bernhard v. Polygraphic Co. of
Am., Inc., 350 U.S. 198 (1956)). On the other hand, once
property rights are determined under State law, Federal law is
utilized to decide the tax consequences. Aquilino v. United
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