Benson v. Commissioner
United States Tax Court
Petitioner created a trust, with an initial corpus of $ 5, with the Aruba Bonaire Curacao Trust Co., Ltd., as trustee. Contemporaneously with the creation of the trust, petitioner entered into an annuity agreement with the trustee, under which she transferred to the trust securities having a fair market value of $ 371,875 in exchange for an annuity having a present value of $ 177,500.92. Held, LaFargue v. Commissioner, 689 F.2d 845 (9th Cir. 1982), followed.
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Petitioner created a trust, with an initial corpus of $ 5, with the Aruba Bonaire Curacao Trust Co., Ltd., as trustee. Contemporaneously with the creation of the trust, petitioner entered into an annuity agreement with the trustee, under which she transferred to the trust securities having a fair market value of $ 371,875 in exchange for an annuity having a present value of $ 177,500.92. Held, LaFargue v. Commissioner, 689 F.2d 845 (9th Cir. 1982), followed. Petitioner is not taxable on the income of the trust under the grantor trust rules, and payments received by her pursuant to the annuity…
1Opinion of the Court
Forrester, Judge:
Respondent has determined deficiencies of $4,280.20, $3,863, and $2,452 in petitioner’s Federal income taxes for the years 1974, 1975, and 1976, respectively, and an addition to tax pursuant to section 6653(a)1 of $214.01 for 1974. Respondent having conceded the section 6653(a) addition to tax, the following issues remain for our decision:(la) Whether a transaction between petitioner and a trust established by her was an exchange of securities for an annuity, or a transfer of securities to the trust with a reservation of the right to an annual payment;(lb) If we find a bona…
2Cases cited12 opinions
- Jack E. Golsen and Sylvia H. Golsen v. Commissioner of Internal RevenueCourt of Appeals for the Tenth Circuit · 1971
- Meneguzzo v. CommissionerUnited States Tax Court · 1965
- Rollert Residuary Trust v. CommissionerUnited States Tax Court · 1983
- Lazarus v. CommissionerUnited States Tax Court · 1972
- Bartman v. CommissionerUnited States Tax Court · 1948
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3Cited by12 opinions
- Sidney B. Stern and Vera L. Stern v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1984
- Horstmier v. CommissionerUnited States Tax Court · 1983
- Estate of Fabric v. CommissionerUnited States Tax Court · 1984
- Esther Lafargue v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1986
- Raymond Syufy Marcia Syufy, Plaintiffs-Counterclaim v. United States of America, Defendant-Counterclaimant-AppellantCourt of Appeals for the Ninth Circuit · 1987
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