Skemp v. Commissioner
United States Tax Court
The petitioner set up a trust for benefit of his wife and children, reserving to himself the right to lease a building as well as control over sale, mortgage, or exchange of all property. On the same day he and the trustee, a trust company, executed a lease upon the building, for a stated rental of $ 500 a month for two years, and thereafter to be set by a county official as arbitrator, in case of disagreement. The taxable year falls within the two-year period.
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The petitioner set up a trust for benefit of his wife and children, reserving to himself the right to lease a building as well as control over sale, mortgage, or exchange of all property. On the same day he and the trustee, a trust company, executed a lease upon the building, for a stated rental of $ 500 a month for two years, and thereafter to be set by a county official as arbitrator, in case of disagreement. The taxable year falls within the two-year period. Held, that the petitioner may not deduct as rent paid the $ 500 a month paid to the trustee. Johnson v. Commissioner, 86 Fed. (2d)…
1Opinion of the Court
OPINION.
Disnet, Judge:
The petitioner’s briefs, in substance, contend that the situation here presented does not fall within the principles enunciated in Helvering v. Clifford, 309 U. S. 331, or Helvering v. Stuart, 317 U. S. 154, but that Kohnstamm v. Pedrick, 153 Fed. (2d) 506, applies, so that the trust income is not taxable to him. The respondent argues that the deduction for rent was properly denied, first, because on May 12, 1941, when the trust instrument and lease were executed, the petitioner did not part with a present interest in the building involved, so that no gift in trust was…
2Cases cited2 opinions
- Helvering v. CliffordSupreme Court of the United States · 1940
- Helvering v. StuartSupreme Court of the United States · 1942
3Cited by45 opinions
- Furman v. CommissionerUnited States Tax Court · 1966
- Mathews v. CommissionerUnited States Tax Court · 1973
- Brown v. CommissionerUnited States Tax Court · 1949
- Oakes v. Comm'rUnited States Tax Court · 1965
- Felix v. CommissionerUnited States Tax Court · 1954
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