Fry v. Commissioner
United States Tax Court
Where an employee received the total distributions payable to him by reason of his participation in an employees' pension trust in the taxable year 1947 and reported the sum received as capital gain, and thereafter the employee continued to render services and receive his regular salary of $ 36,500 per year until his death in 1949, held, that the employee was not separated from the service of his employer within the meaning of section 165 (b) of the Internal Revenue Code and…
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Where an employee received the total distributions payable to him by reason of his participation in an employees' pension trust in the taxable year 1947 and reported the sum received as capital gain, and thereafter the employee continued to render services and receive his regular salary of $ 36,500 per year until his death in 1949, held, that the employee was not separated from the service of his employer within the meaning of section 165 (b) of the Internal Revenue Code and the amount of the settlement is taxable as ordinary income, the employee having made no contributions to the trust.
1Opinion of the Court
OPINION.
Hill, Judge:
Section 165 (b) of the Internal Revenue Code provides that an amount distributed or made available by employees’ trust to an employee shall be taxable as though it were an annuity, the consideration for which is the amount contributed by the employee. We have found as a fact that the decedent, Frank B. Fry, never made any contribution to the pension trust involved here, so that the tax would apply to the whole sum of $65,481.50 distributed to him in the taxable year 1947. However, section 165 (b) provides further that if the total distribution payable to the employee is…
2Cited by40 opinions
- United States v. Ophelia Johnson and Ophelia R. Johnson, as Under the Last Will and Testament of Clifford L. Johnson, DeceasedCourt of Appeals for the Fifth Circuit · 1964
- Fry's Estate v. Commissioner of Internal RevenueCourt of Appeals for the Third Circuit · 1953
- E. N. Funkhouser and Estate of Nellie S. Funkhouser, Deceased, E. N. Funkhouser v. Commissioner of Internal RevenueCourt of Appeals for the Fourth Circuit · 1967
- Funkhouser v. CommissionerUnited States Tax Court · 1965
- Reinhardt v. CommissionerUnited States Tax Court · 1985
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