Funk v. Commissioner
United States Tax Court
Petitioner was the sole trustee of trusts set up by her husband. Petitioner was given the absolute power to pay, in her own discretion and not subject to the control of her husband or of any other person, all or part of the trust income to herself or to her husband, in accordance with their respective needs, of which she was the sole judge, and to accumulate any undistributed balance.
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Petitioner was the sole trustee of trusts set up by her husband. Petitioner was given the absolute power to pay, in her own discretion and not subject to the control of her husband or of any other person, all or part of the trust income to herself or to her husband, in accordance with their respective needs, of which she was the sole judge, and to accumulate any undistributed balance. Held, petitioner is taxable under section 22 (a) on all of the trust income, whether or not she distributed all of the income to herself. Mallinckrodt v. Nunan, 146 Fed. (2d) 1, and Stix v. Commissioner, 152…
1DissentDisney, J.
In this case the facts fall squarely within the text of section 161 (a) (4) and (b) of the Internal Revenue Code,1 providing taxability to fiduciary of trust income which, in the discretion of the fiduciary, may be either distributed to the beneficiaries or accumulated, for the trust here involved provides that the trustee may, in her discretion, either pay out all or a part of the income or accumulate it. The exact language of the instrument is: “In her discretion to pay all or a part of the net income annually to me, or to herself, * * * and to accumulate and add to principal the bal-anee…
2Cases cited17 opinions
- Helvering v. CliffordSupreme Court of the United States · 1940
- Helvering v. HorstSupreme Court of the United States · 1940
- Corliss v. BowersSupreme Court of the United States · 1930
- Harrison v. SchaffnerSupreme Court of the United States · 1941
- Carrier v. . CarrierNew York Court of Appeals · 1919
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