Herberts v. Commissioner
United States Tax Court
Petitioner made outright gifts of stock to his wife and children prior to 1941. During January 1941 he caused the donated stock and additional stock to be transferred to himself purportedly as trustee under parol trusts. In December 1941 he executed in writing irrevocable trust under which he held all of the stock. He retained discretionary power to use the income for the support and maintenance of his daughter for life and of his son during minority.
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Petitioner made outright gifts of stock to his wife and children prior to 1941. During January 1941 he caused the donated stock and additional stock to be transferred to himself purportedly as trustee under parol trusts. In December 1941 he executed in writing irrevocable trust under which he held all of the stock. He retained discretionary power to use the income for the support and maintenance of his daughter for life and of his son during minority. The principal of the trust for the son was payable to him upon reaching majority. Assets received in liquidation of the stock during 1942 were…
1Opinion of the Court
OPINION.
Kern, Judge:
While the respondent contends in the income tax proceeding that the petitioner is taxable under the provisions of both sections 22 (a) and 167 of the Internal Revenue Code, he relies primarily on the general principles set forth in Helvering v. Clifford, 309 U. S. 331, and his principal contention is that petitioner is taxable under section 22 (a). The income in question is traceable, with a minor exception, to transfers of the Herberts Machinery Co. stock by the petitioner either to or for the benefit of his children.
It is necessary, therefore, to consider first the…
2Cases cited22 opinions
- Helvering v. CliffordSupreme Court of the United States · 1940
- Corliss v. BowersSupreme Court of the United States · 1930
- Helvering v. StuartSupreme Court of the United States · 1942
- Estate of Tetsubumi YanoCalifornia Supreme Court · 1922
- Newman v. CommissionerUnited States Tax Court · 1943
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3Cited by5 opinions
- Estate of Jack F. Chrysler, Edith B. Carr, John W. Drye, Jr. And Manufacturers Hanover Trust Company, Executors v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1966
- Swanson v. CommissionerCourt of Appeals for the Eighth Circuit · 1975
- W. Clarke Swanson, Jr., 1950 Trust Under Instrument Dated January 3, 1955, Swanco Trust Company, Trustee, and Cross-Appellant v. Commissioner of Internal Revenue, and Cross-Appellee. Carol Swanson Rhoden, 1950 Trust Under Instrument Dated January 3, 1955, Swanco Trust Company, Trustee, and Cross-Appellant v. Commissioner of Internal Revenue, and Cross-Appellee. Gerock Hurley Swanson, 1950 Trust Under Instrument Dated January 3, 1955, Swanco Trust Company, Trustee, and Cross-Appellant v. Commissioner of Internal Revenue, and Cross-AppelleeCourt of Appeals for the Eighth Circuit · 1975
- Herberts v. CommissionerUnited States Tax Court · 1948
- Swanson v. CommissionerUnited States Tax Court · 1974