Francis H. W. Ducros and Phyllis A. Ducros v. Commissioner of Internal Revenue

WEICK, Circuit Judge.

This is an appeal from a decision of the Tax Court sustaining a deficiency in. income tax and an addition thereto for the year 1951.

The sole issue is whether the proceeds of a life insurance policy paid to Mrs. Phyllis A. Ducros, upon the death of Carlton L. Small, are taxable to her as income. Section 22(b)(1)(A) of the Internal Revenue Code of 1939, 26 U.S.C.A. § 22(b)(1)(A) exempts from taxation amounts received under a life insurance contract, paid by reason of the death of the insured.

Carlton L. Small was the President of Smead & Small, Inc., at the time of his death…