Fayen v. Commissioner
United States Tax Court
In 1953 Carl F. Fayen, the sole trustee and life-income beneficiary of the Carl F. Fayen Trust, paid $ 4,664.37 into the principal of said trust in compromise of surcharge proceedings filed by the guardian ad litem for the remaindermen of the trust. Held, that petitioner is not engaged in carrying on a trade or business as trustee. His claim for deduction under section 23(a)(1)(A), I.R.C. 1939, is accordingly denied.
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In 1953 Carl F. Fayen, the sole trustee and life-income beneficiary of the Carl F. Fayen Trust, paid $ 4,664.37 into the principal of said trust in compromise of surcharge proceedings filed by the guardian ad litem for the remaindermen of the trust. Held, that petitioner is not engaged in carrying on a trade or business as trustee. His claim for deduction under section 23(a)(1)(A), I.R.C. 1939, is accordingly denied. Held, further, that said payment in settlement of the surcharge suit is not an expense incurred in the collection or production of income and hence not deductible under section…
1DissentBruce, J.
I agree with the majority of the Court that petitioner is not engaged in carrying on a trade or business as trustee and, accordingly, that his claim for deduction under section 23(a) (1) (A) should be denied.
In my opinion, however, a different conclusion is required with respect to petitioner’s alternative contention that the expenditures involved are deductible as “ordinary and necessary expenses paid or incurred during the taxable year for the production or collection of income or for the management, conservation, or maintenance of property held for the production of income, under the…
2Cases cited22 opinions
- Commissioner v. HeiningerSupreme Court of the United States · 1943
- Higgins v. CommissionerSupreme Court of the United States · 1941
- Kornhauser v. United StatesSupreme Court of the United States · 1928
- Trust Under the Will of Bingham v. CommissionerSupreme Court of the United States · 1945
- McDonald v. CommissionerSupreme Court of the United States · 1944
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