Ellery v. Commissioner
United States Tax Court
1. Where by reading together the simultaneously executed declaration of gift and articles of partnership it appears that the gift by petitioner to his wife of one-half his gambling machine business and of the property used therein was conditioned on the formation of a partnership for the continuation of such business and where it further appears that by the state law such a partnership could not be formed because of its illegal purpose, held, the gift failed at the outset…
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1. Where by reading together the simultaneously executed declaration of gift and articles of partnership it appears that the gift by petitioner to his wife of one-half his gambling machine business and of the property used therein was conditioned on the formation of a partnership for the continuation of such business and where it further appears that by the state law such a partnership could not be formed because of its illegal purpose, held, the gift failed at the outset because it was expressly or by implication made upon a condition or limited to a purpose which failed, and hence the…
1Opinion of the Court
OPINION.
TTtt.t., Judge:
The first issue is whether the entire income of the slot machine business is taxable to petitioner or whether there was a partnership between him and his wife which must be recognized for tax purposes. The gift of an undivided one-half interest in petitioner’s business to his wife was made solely for the purpose of enabling them to form a partnership. The testimony for petitioner indicated that the reason a partnership was deemed desirable was (1) that there would be less likelihood of insubordination of employees.if they knew Mrs. Ellery to be a partner and (2) she…
2Cases cited4 opinions
- Commissioner v. HeiningerSupreme Court of the United States · 1943
- Grossman v. GreensteinCourt of Appeals of Maryland · 1931
- Farless v. MoreheadCourt of Appeals for the Sixth Circuit · 1912
- Jackson v. Brick AssociationOhio Supreme Court · 1895
3Cited by2 opinions
- Hanson v. BirminghamDistrict Court, N.D. Iowa · 1950
- Ellery v. CommissionerUnited States Tax Court · 1944