Affelder v. Commissioner
United States Tax Court
1. Petitioner transferred property in trust. The trustee was to pay certain annuities to her children and the balance of the income was to be paid her for life. At her death the remainder interest was to go to her children. The trust conveyance carried no provision obligating the trust to pay the gift tax arising from the transaction, but after the conveyance all of the parties in interest joined in a direction to the trustee to pay such tax from the trust corpus.
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1. Petitioner transferred property in trust. The trustee was to pay certain annuities to her children and the balance of the income was to be paid her for life. At her death the remainder interest was to go to her children. The trust conveyance carried no provision obligating the trust to pay the gift tax arising from the transaction, but after the conveyance all of the parties in interest joined in a direction to the trustee to pay such tax from the trust corpus. Held, that for the purpose of determining gift tax liability the value of the property transferred can not be reduced by the…
1Opinion of the Court
OPINION.
Leech, Judge:
Petitioner’s first contention is that for gift tax purposes the total value of the assets transferred to the trust must be reduced by the amount of the gift tax which was occasioned by the transfer and was paid by the trustee under directions by petitioner and her three children, who were the sole beneficiaries and the only parties in interest. The argument is that the present situation is similar to that of a conveyance of property by gift which is subject to a mortgage, in which case the rule is that the gift is that of only the equity in the property. There,…
2Cases cited3 opinions
- Du Pont v. CommissionerUnited States Tax Court · 1943
- Anthony v. CommissionerUnited States Tax Court · 1945
- Gruen v. CommissionerUnited States Tax Court · 1942
3Cited by18 opinions
- Harrison v. CommissionerUnited States Tax Court · 1952
- Bartman v. CommissionerUnited States Tax Court · 1948
- Dix v. CommissionerUnited States Tax Court · 1966
- Estate of Bell v. CommissionerUnited States Tax Court · 1973
- Koshland v. CommissionerUnited States Tax Court · 1948
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