Golsen v. Commissioner
United States Tax Court
T purchased 20 "executive special" life insurance policies that were specially designed, calling for abnormally high premiums and providing for correspondingly high loan and cash surrender values.
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T purchased 20 "executive special" life insurance policies that were specially designed, calling for abnormally high premiums and providing for correspondingly high loan and cash surrender values. As part of a prearranged plan T not only "paid" the first year's premiums but also made "payments" into a "prepaid premium fund" in respect of the premiums to become due in the next 4 years, and he simultaneously "borrowed" back not only the full amount of the "prepaid premium fund" but also the full loan value of the policies created by the first year's premium. His "interest" obligations in…
1Opinion of the Court
OPINION
Raum, Judge.:
This case involves an ingenious device which, if successful, would result in petitioner’s purchase of a substantial amount of life insurance for the protection of his family at little or no after-tax cost to himself, or possibly even with a net profit in some years. The device is based on an unusual type of insurance policy that apears to have 'been specially designed for this purpose in which the rates were set at an artificially high level with correspondingly high cash surrender and loan values to begin immediately during the very first year of the life of the policy.…
2Cases cited34 opinions
- Gregory v. HelveringSupreme Court of the United States · 1935
- Deputy, Administratrix v. Du PontSupreme Court of the United States · 1940
- Commissioner v. Court Holding Co.Supreme Court of the United States · 1945
- Higgins v. SmithSupreme Court of the United States · 1940
- Knetsch v. United StatesSupreme Court of the United States · 1960
29 more not listed; retrieve them via the Exa API.
3Cited by62 opinions
- Metzger Trust v. CommissionerUnited States Tax Court · 1981
- Tobler v. DerwinskiUnited States Court of Appeals for Veterans Claims · 1991
- Rebecca Jo Reser v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1997
- Consolidated Freightways, Inc. & Affiliates v. CommissionerUnited States Tax Court · 1980
- Ronald Byers v. Commissioner of IRSCourt of Appeals for the D.C. Circuit · 2014
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