American National Bank & Trust Company, Not Personally, but as of the Estate of Robert C. Usher, Deceased v. United States

SPRECHER, Circuit Judge.

The issue raised by this appeal is whether the penalty for the late-filing of an estate tax return after a substantial recovery on a contested insurance claim should be based on the value of the claim at death or on the amount of the claim ultimately recovered. We hold that the value at the date of death controls and remand to the district court for a determination of that value necessary to establish the refund due to the taxpayer.

I

On January 23, 1967, Robert C. Usher was killed when the automobile he was driving was struck by a train. An eyewitness to the accident…