Estate of Wyly v. Commissioner
United States Tax Court
Decedent and his wife, Texas residents, transferred community property into a trust pursuant to which the income was to go to the wife for her life, with remainder to grandchildren. Under Texas law, the trust income was community property, with the decedent remaining the owner of one-half thereof. Held, the decedent's one-half share of the transferred community property was fully includable in his gross estate.
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Decedent and his wife, Texas residents, transferred community property into a trust pursuant to which the income was to go to the wife for her life, with remainder to grandchildren. Under Texas law, the trust income was community property, with the decedent remaining the owner of one-half thereof. Held, the decedent's one-half share of the transferred community property was fully includable in his gross estate. United States v. Estate of Grace, 395 U.S. 316 (1969); Estate of Castleberry v. Commissioner, 68 T.C. 682 (1977).
1Opinion of the Court
OPINION
Hall, Judge:
Respondent determined a deficiency in petitioner’s Federal estate tax in the amount of $8,660.04. Decedent and his wife made gifts of their community interests in various corporate stocks to an irrevocable trust, the income from which was payable periodically to decedent’s wife. The sole issue is whether the value of such gifts is includable in his gross estate, in whole or in part, under section 2036(a)(1).1
All of the facts have been stipulated and are so found. Those necessary to an understanding of this case are as follows:
Charles J. Wyly, Sr. (decedent), resided in…
2Cases cited13 opinions
- Irwin v. GavitSupreme Court of the United States · 1925
- United States v. Estate of GraceSupreme Court of the United States · 1969
- Estate of Daniel McNichol Deceased, Ellen McNichol Evangelista and Joseph G. McNichol Executors v. Commissioner of Internal RevenueCourt of Appeals for the Third Circuit · 1959
- Commissioner of Internal Revenue v. WilsonCourt of Appeals for the Fifth Circuit · 1935
- Commissioner of Internal Revenue v. Estate of HindsCourt of Appeals for the Fifth Circuit · 1950
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3Cited by4 opinions
- Estate of Wyly v. CommissionerCourt of Appeals for the Fifth Circuit · 1980
- Estate of Charles J. Wyly, Sr., Flora E. Wyly, Independent (Charles J. Wyly, Jr. And Samuel Evans Wyly Substituted in the Place and Stead of Flora E. Wyly, Independent Deceased) v. Commissioner of Internal Revenue, Estate of Winston C. Castleberry, Deceased, Republic National Bank of Dallas, Independent Cross-Appellee v. Commissioner of Internal Revenue, Cross-Appellant. Russell M. Frankel, Donald E. Woodard and Southern National Bank of Houston, as Independent Co-Executors of the Estate of Jules R. Frankel, Deceased v. United StatesCourt of Appeals for the Fifth Circuit · 1980
- Estate of McKee v. CommissionerUnited States Tax Court · 1978
- Estate of Wyly v. CommissionerUnited States Tax Court · 1977