MacArthur v. Commissioner
United States Tax Court
Petitioner and her mother purchased two annuity contracts, each for a consideration of $ 25,000, of which each paid half. Each annuity contract provided for an annuity to the mother during her life, thereafter to the petitioner.
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Petitioner and her mother purchased two annuity contracts, each for a consideration of $ 25,000, of which each paid half. Each annuity contract provided for an annuity to the mother during her life, thereafter to the petitioner. Held, the Commissioner did not err in denying exclusion from gross income of the amount above 3 per cent of the consideration for which petitioner might have purchased separately an annuity contract for a period following the death of her mother, and in taxing 3 per cent of the $ 50,000 consideration paid, under section 22 (b) (2) of the Internal Revenue Code.
1Opinion of the Court
OPINION.
Disney, Judge:
The effect of section 22 (b) (2) of the Internal Revenue Code1 is that of amounts received under an annuity the person receiving shall pay income tax upon 3 per cent “of the aggregate premiums or consideration paid for such annuity” and may exclude the remainder of the annuity from gross income (until the aggregate amount excluded equals the premiums or consideration paid, a situation not involved in this case). The petitioner here, after the death of her mother in 1940, received in 1941, the year here involved, a total of $2,034.96 upon the two annuities purchased by…
2Cited by10 opinions
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- Shelley v. CommissionerUnited States Tax Court · 1948
- Morschauser v. CommissionerUnited States Tax Court · 1958
- Caltex Oil Venture, Caltex Management Corporation, Tax Matters Partner v. CommissionerUnited States Tax Court · 2012
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