Estate of Noel v. Commissioner
United States Tax Court
Decedent owned subordinated corporate debenture bonds which had been issued at a discount and which became due on Jan. 1, 1956. Decedent died on June 20, 1956, without receiving any payments on the bonds. In 1957 decedent's estate transferred the bonds to a creditor of decedent and received a credit against the indebtedness of the full face value of the matured bonds.
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Decedent owned subordinated corporate debenture bonds which had been issued at a discount and which became due on Jan. 1, 1956. Decedent died on June 20, 1956, without receiving any payments on the bonds. In 1957 decedent's estate transferred the bonds to a creditor of decedent and received a credit against the indebtedness of the full face value of the matured bonds. Held, the increment in value (discount) of the bonds is taxable as ordinary income to decedent's estate, as income in respect of a decedent under sec. 691, I.R.C. 1954, in the year 1957; the increment was not taxable to…
1Opinion of the Court
Drennen, Judge:
Respondent determined a deficiency in petitioner’s income tax for 1957 in the amount of $9,720.63. The issue is whether petitioner realized income in respect of a decedent in 1957 within the meaning of section 691, I.R.C. 1954,1 when certain debentures owned by decedent were used by the estate to satisfy an outstanding debt of the decedent.
FINDINGS OF FACT
Some of the facts were stipulated and they are so found.
Marshal L. Noel, a resident of Ridgewood, N.J., died on June 20, 1956, leaving a last will and testament which was probated on July 27, 1956, in the Surrogate’s Court of…
2Cases cited4 opinions
- United States v. Midland-Ross Corp.Supreme Court of the United States · 1965
- Gullett v. CommissionerUnited States Board of Tax Appeals · 1935
- Jacobs v. CommissionerUnited States Board of Tax Appeals · 1931
- Evelyn Z. Levin v. United StatesCourt of Appeals for the First Circuit · 1967
3Cited by5 opinions
- Gaines v. CommissionerUnited States Tax Court · 1982
- Heitz v. CommissionerUnited States Tax Court · 1998
- Estate of Noel v. CommissionerUnited States Tax Court · 1968
- Kelley v. CommissionerUnited States Tax Court · 1991
- Wise v. CommissionerUnited States Tax Court · 1997