Estate of Marks v. Commissioner
United States Tax Court
In April 1981, E and M, husband and wife and residents of Louisiana, a community property state, each applied for a life insurance policy insuring the life of the other. In July 1981, a $ 500,000 policy on E's life was issued to M and a $ 250,000 policy on M's life was issued to E. In July 1982, E and M died simultaneously in an airplane crash. Held: Each policy is the separate property of the noninsured spouse.
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In April 1981, E and M, husband and wife and residents of Louisiana, a community property state, each applied for a life insurance policy insuring the life of the other. In July 1981, a $ 500,000 policy on E's life was issued to M and a $ 250,000 policy on M's life was issued to E. In July 1982, E and M died simultaneously in an airplane crash. Held: Each policy is the separate property of the noninsured spouse. Accordingly, the proceeds of said policies are not includable in the insured spouse's gross estate under secs. 2042(2), 2038, or 2035, I.R.C.Held, further: The interpolated terminal…
1DissentParr, J.
The result reached by the majority may be correct as a matter of tax policy. Since the credit provided by section 2013 was designed “to prevent the diminution of an estate by the imposition of successive taxes on the same property within a brief period” (S. Rept. 1622, 83d Cong., 2d Sess. 122 (1954)), it is questionable whether a transferee of a terminable interest, such as a usufruct, should receive a credit even though that interest is not included in the transferee’s gross estate. See Holbrook v. United States, 575 F.2d 1288, 1290 (9th Cir. 1978), for the apparent reasons the credit is…
2Cases cited5 opinions
- Ithaca Trust Co. v. United StatesSupreme Court of the United States · 1929
- Estate of Ellen M. Wien, Deceased v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1971
- Old Kent Bank & Trust Co. v. United StatesCourt of Appeals for the Sixth Circuit · 1970
- Jane W. Holbrook and First National Bank of Arizona, Co-Executors of the Estate of William Wraith, Jr., Deceased v. United StatesCourt of Appeals for the First Circuit · 1978
- Estate of Lloyd v. United StatesUnited States Court of Claims · 1981