Estate of Cutter v. Commissioner
United States Tax Court
Decedent created substantially identical trusts for each of his eight grandchildren and served as sole trustee of each until his death. The trust instruments provided that the trustee in his sole discretion could distribute part or all of the income to the beneficiary of each of the trusts as he deemed "necessary for the benefit" of each of them.
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Decedent created substantially identical trusts for each of his eight grandchildren and served as sole trustee of each until his death. The trust instruments provided that the trustee in his sole discretion could distribute part or all of the income to the beneficiary of each of the trusts as he deemed "necessary for the benefit" of each of them. Held, the power in each of the trusts did not create a judicially ascertainable standard and, therefore, the principal and accumulated income therefrom of each of the trusts is includable in the decedent's gross estate pursuant to sec. 2036(a)(2).
1Opinion of the Court
Irwin, Judge:
Respondent determined a deficiency of $117,719 in the estate tax of the Estate of Fred A. Cutter.
Due to certain concessions made by the parties, the only issue remaining for our decision is whether the principal and accumulated income therefrom (or any part thereof) of eight trusts established by the decedent during his lifetime for the benefit of his grandchildren should be includable in his gross estate. This issue depends upon whether the decedent retained the right in each of the trusts to designate the persons who shall possess or enjoy the transferred property or the income…
2Cases cited22 opinions
- Estate of RussellCalifornia Supreme Court · 1968
- United States v. O'MALLEYSupreme Court of the United States · 1966
- Industrial Trust Co. v. Commissioner of Internal Rev.Court of Appeals for the First Circuit · 1947
- Jennings v. SmithCourt of Appeals for the Second Circuit · 1947
- Estate of Ford v. CommissionerUnited States Tax Court · 1969
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3Cited by9 opinions
- Estate of Craft v. CommissionerUnited States Tax Court · 1977
- Hemphill v. ShoreSupreme Court of Kansas · 2012
- Estate of Gilchrist v. CommissionerCourt of Appeals for the Fifth Circuit · 1980
- Estate of Anna Lora Gilchrist, Deceased, Layland Myatt and Elizabeth Dearborn, Independent Executors v. Commissioner of Internal Revenue, Estate of Ruth T. Reid, Deceased, Walter D. Reid, Independent v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1980
- Forsee v. United StatesDistrict Court, D. Kansas · 1999
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