Estate of Levine v. Commissioner
United States Tax Court
Five trusts for minor grandchildren were created whereby the income interests during minority qualified as present interests for the annual exclusions solely by reason of sec. 2503(c). Upon attainment of age 21 the income was required to be paid at least annually to each grandchild for life.
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Five trusts for minor grandchildren were created whereby the income interests during minority qualified as present interests for the annual exclusions solely by reason of sec. 2503(c). Upon attainment of age 21 the income was required to be paid at least annually to each grandchild for life. Held, the income interests under these facts are to be treated in toto, i.e., as income interests for the life of the grandchild named in each trust, and not as separate components, and as such constitute single forms of property which are present interests for the purpose of the annual exclusions by…
1DissentRaum, J.
It represents an impermissible extension of Arlean I. Herr, 35
T.C. 732, affirmed 303 F. 2d 780 (C.A. 3), which itself was an extreme case. The result herein stretches the statute beyond the breaking point.
First. — It is important at the outset to keep the applicable provisions of the 1954 Code clearly in mind.1 The operative provision of the Code which allows the annual exclusion of the first $3,000 of gift to each person is contained in section 2503(b). However, this exclusion by its own terms, is not available in the case of “gifts of future interests in property.” And there is no dispute…
2Cases cited8 opinions
- Commissioner v. DisstonSupreme Court of the United States · 1945
- Weller v. CommissionerUnited States Tax Court · 1962
- Herr v. CommissionerUnited States Tax Court · 1961
- Commissioner of Internal Revenue v. Arlean I. Herr, in No. 13,811, and Robert F. Herr, in No. 13,812Court of Appeals for the Third Circuit · 1962
- Hessenbruch v. Commissioner of Internal RevenueCourt of Appeals for the Third Circuit · 1950
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