Estate of Leder v. Commissioner
United States Tax Court
Within 3 years of decedent's death, decedent's wife purchased life insurance on decedent's life and signed the original application as owner. Decedent's wholly owned corporation paid all the premiums on the policy directly to the insurance company.
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Within 3 years of decedent's death, decedent's wife purchased life insurance on decedent's life and signed the original application as owner. Decedent's wholly owned corporation paid all the premiums on the policy directly to the insurance company. Held, under the plain language of sec. 2035(d), I.R.C. 1954, the life insurance policy proceeds are not includable in decedent's gross estate because decedent never possessed any incident of ownership in the policy under sec. 2042. Thus, sec. 2035(d)(2) is inapplicable and sec. 2035(d)(1) precludes application and analysis of sec. 2035(a).
1Opinion of the Court
OPINION
WELLS, Judge:*
Respondent determined a deficiency in petitioner’s Federal estate tax in the amount of $253,547.77. After concessions, the sole issue for decision is whether proceeds from a life insurance policy, purchased by the insured’s spouse within 3 years of the insured’s death, are includable in the insured’s gross estate where the policy premiums were paid by preauthorized withdrawals from the account of a corporation wholly owned by the insured.
This case was submitted fully stipulated pursuant to Rule 122.1 The stipulation of facts and exhibits thereto are incorporated herein by…
2Cases cited15 opinions
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