Doty v. Commissioner
United States Tax Court
By a testamentary trust, holding shares of stock, the income was, by one provision, to be distributed quarterly to the beneficiary for life, and the trustee was, by another provision, given power to determine whether accretions should be considered as income or as principal. The trust received an ordinary dividend upon the shares, and the trustee determined the amount to be principal and withheld distribution thereof.
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By a testamentary trust, holding shares of stock, the income was, by one provision, to be distributed quarterly to the beneficiary for life, and the trustee was, by another provision, given power to determine whether accretions should be considered as income or as principal. The trust received an ordinary dividend upon the shares, and the trustee determined the amount to be principal and withheld distribution thereof. Held, the trustee had no power to classify the dividend as principal, and the amount is income distributable to the beneficiary and properly included within her gross income…
1Opinion of the Court
OPINION.
Steknhagen, -Judge-.
The taxpayer was the named beneficiary of trust B, set up by the will of her mother, but she did not receive any distribution from the trust, because the trustee, in what she regarded as her proper discretion under paragraph thirteenth, determined that the amount of dividends received by the trust was an accretion to the trust property, which the trustee had the power to consider as principal, and that as principal it was not distributable to the beneficiary under paragraph fourth of the will. The taxpayer, in her return, in reliance upon this action of the…
2Cases cited2 opinions
- American Security & Trust Co. v. FrostCourt of Appeals for the D.C. Circuit · 1940
- Revloc Supply Co. v. TroxellSupreme Court of Pennsylvania · 1924
3Cited by9 opinions
- Estate of Ford v. CommissionerUnited States Tax Court · 1969
- Pardee v. CommissionerUnited States Tax Court · 1967
- Brown v. CommissionerUnited States Tax Court · 1958
- Pettus v. CommissionerUnited States Tax Court · 1970
- Brown v. CommissionerUnited States Tax Court · 1958
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