Commissioner of Internal Revenue v. Josephine N. Thebaut and Charles R. Thebaut, Jr.

WISDOM, Circuit Judge:

Charles and Josephine Thebaut, in filing their gift tax returns for 1958, 1959, and 1960, applied the annual exclusion provided by Section 2503(b) of the Internal Revenue Code of 1954 to the full amount of gifts of principal and income made to trusts created for a minor child and three minor grandchildren. The Commissioner disallowed the exclusions. The Tax Court overruled the Commissioner. Josephine N. Thebaut, 42 T.C. 1155 (1964). We affirm that part of the Tax Court’s decision permitting exclusion of the gifts of income. Arlean I. Herr, 35 T.C. 732 (1961), affirmed, 3…