Weller v. Commissioner
United States Tax Court
In October 1952, petitioner Carl E. Weller purchased an annuity contract, naming his daughter as annuitant but reserving all rights and incidents of ownership in the policy unless she should survive him. He paid the first annual premium in the amount of $ 20,000. Approximately 6 weeks later he prepaid at a discount all future premiums with funds borrowed from a bank on his personal note, on which he pledged the annuity contract as collateral security.
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In October 1952, petitioner Carl E. Weller purchased an annuity contract, naming his daughter as annuitant but reserving all rights and incidents of ownership in the policy unless she should survive him. He paid the first annual premium in the amount of $ 20,000. Approximately 6 weeks later he prepaid at a discount all future premiums with funds borrowed from a bank on his personal note, on which he pledged the annuity contract as collateral security. On the same day he received as a loan the cash or loan value of the policy as of its first anniversary date, and repaid the bank loan with the…
1Opinion of the Court
Forrester, Judge:
Respondent has determined a deficiency in the income tax of petitioners for the calendar year 1952 in the amount of $28,151.10. The sole issue is whether respondent erred in determining that the amount of $40,050.06 paid by petitioners purportedly as interest in respect of an alleged loan of the “cash or loan” value of an annuity policy was not interest deductible pursuant to section 23 (b) of the Internal Revenue Code of 1939.
findings of fact.
Petitioners are husband and wife, and reside in Easton, Pennsylvania. Their joint income tax return for the calendar year 1952 was…
2Cases cited1 opinion
- Emmons v. CommissionerUnited States Tax Court · 1958
3Cited by73 opinions
- Carl E. Weller and Emily I. Weller v. Commissioner of Internal Revenue, W. Stuart Emmons v. Commissioner of Internal RevenueCourt of Appeals for the Third Circuit · 1959
- Davis v. CommissionerUnited States Tax Court · 1976
- Karme v. CommissionerUnited States Tax Court · 1980
- Stanton v. CommissionerUnited States Tax Court · 1960
- Bridges v. CommissionerUnited States Tax Court · 1963
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