Estate of Smead v. Commissioner
United States Tax Court
Decedent was insured under a group life insurance policy provided by his employer. The only right decedent had with respect to the policy was the right to convert his group life insurance into an individual life insurance policy upon termination of his employment.
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Decedent was insured under a group life insurance policy provided by his employer. The only right decedent had with respect to the policy was the right to convert his group life insurance into an individual life insurance policy upon termination of his employment. Held, the conversion privilege, which is contingent upon termination of employment, is not an incident of ownership within the meaning of sec. 2042(2), I.R.C. 1954, so the proceeds of the life insurance policy are not includable in his gross estate.
1Opinion of the Court
Parker, Judge:
Respondent determined a deficiency in petitioner’s Federal estate tax in the amount of $19,242.60 and an addition to tax under the provisions of section 6651(a)1 in the amount of $917.98.
After concessions, the sole issue for decision is whether proceeds of an insurance policy on decedent’s life are includa-ble in his gross estate under section 2042(2).
FINDINGS OF FACT
This case was submitted fully stipulated under Rule 122 of the Tax Court Rules of Practice and Procedure. The stipulation of facts and the attached exhibits are incorporated herein by this reference.
Petitioner John…
2Cases cited16 opinions
- Stubbs, Overbeck & Associates, Inc. v. United StatesCourt of Appeals for the Fifth Circuit · 1971
- Estate of Lang v. CommissionerUnited States Tax Court · 1975
- M. E. Blatt Co. v. United StatesSupreme Court of the United States · 1938
- The Estate of Grace E. Lang, Deceased. Richard E. Lang v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1980
- Commissioner of Internal Revenue v. TreganowanCourt of Appeals for the Second Circuit · 1950
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3Cited by22 opinions
- Anselmo v. CommissionerUnited States Tax Court · 1983
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- Dominion Resources, Incorporated v. United StatesCourt of Appeals for the Fourth Circuit · 2000
- Warsaw Photographic Associates, Inc. v. CommissionerUnited States Tax Court · 1985
- Loda Poultry Co. v. CommissionerUnited States Tax Court · 1987
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