281 U.S. 238 (1930), 311, May v. Heiner

Docket Nº:No. 311
Citation:281 U.S. 238, 50 S.Ct. 286, 74 L.Ed. 826
Party Name:May v. Heiner
Case Date:April 14, 1930
Court:United States Supreme Court

Page 238

281 U.S. 238 (1930)

50 S.Ct. 286, 74 L.Ed. 826




No. 311

United States Supreme Court

April 14, 1930

Argued March 7, 1930




1. A transfer in trust by a grantor since deceased, under which the income was payable to decedent's husband during his lifetime and after his death to the decedent during her lifetime, with remainder over to her children, held not made in contemplation of or intended to take effect in possession or enjoyment at or after death within the legal significance of those words, and that therefore the corpus of the trust should not be included in the value of the gross estate of the decedent for purposes of estate tax under § 402(c) of the Revenue Act of 1918. P. 243.

2. The estate tax of the Revenue Act of 1918, § 401, imposes an excise upon the transfer of an estate upon the death of the owner. P. 244.

32 F.2d 1017 reversed.

Certiorari, 280 U.S. 542, to review a judgment of the circuit court of appeals which affirmed a judgment of the district court, 25 F.2d 1004, sustaining a federal estate tax.

MCREYNOLDS, J., lead opinion

MR. JUSTICE McREYNOLDS delivered the opinion of the Court.

By a written instrument dated October 1, 1917, Pauline May, wife of Barney May, "transferred, set over and assigned" to him and others, as trustees (with power to change the investments) certain described securities -- bonds, notes, corporate stocks, and money -- in trust, to collect the income therefrom, and, after discharging taxes, expenses, etc., to pay the balance

to Barney May during his lifetime, and after his decease, to Pauline May during her lifetime, and after her decease, all the property in said Trust, in whatever form or shape it may be, shall, after the expenses of the Trust have been deducted or paid, be distributed equally among

her four children, their distributees, or appointees.

Mrs. May died March 25, 1920. Thereafter, the Commissioner of Internal Revenue, purporting to proceed under authority of the Revenue Act of 1918, Tit. 4, 40 Stat. 1057, 1096, 1097, demanded that her executors pay additional taxes reckoned upon the value of the property held under the above-described trust instrument. Having paid the required sum, the executors -- petitioners here -- asked that it be refunded. By order of...

To continue reading