Lucas v. Earl, No. 99

CourtUnited States Supreme Court
Writing for the CourtHOLMES
Citation281 U.S. 111,74 L.Ed. 731,50 S.Ct. 241
Decision Date17 March 1930
Docket NumberNo. 99
PartiesLUCAS, Commissioner of Internal Revenue, v. EARL

281 U.S. 111
50 S.Ct. 241
74 L.Ed. 731
LUCAS, Commissioner of Internal Revenue,

v.

EARL.

No. 99.
Argued March 3, 1930.
Decided March 17, 1930.

The Attorney General and Mr. Charles E. Hughes, Jr., Sol. Gen., of Washington, D. C., for petitioner.

Warren Olney, Jr., of San Francisco, Cal., for respondent.

[Argument of Counsel from pages 111-113 intentionally omitted]

Page 113

Mr. Justice HOLMES delivered the opinion of the Court.

This case presents the question whether the respondent, Earl, could be taxed for the whole of the salary and attorney's fees earned by him in the years 1920 and 1921, or should be taxed for only a half of them in view of a contract with his wife which we shall mention. The Commissioner of Internal Revenue and the Board of Tax Appeals imposed a tax upon the whole, but their decision was reversed by the Circuit Court of Appeals, 30 F.(2d) 898. A writ of certiorari was granted by this court.

By the contract, made in 1901, Earl and his wife agreed 'that any property either of us now has or may hereafter

Page 114

acquire * * * in any way, either by earnings (including salaries, fees, etc.), or any rights by contract or otherwise, during the existence of our marriage, or which we or either of us may receive by gift, bequest, devise, or inheritance, and all the proceeds, issues, and profits of any and all such property shall be treated and considered, and hereby is declared to be received, held, taken, and owned by us as joint tenants, and not otherwise, with the right of survivorship.' The validity of the contract is not questioned, and we assume it to be unquestionable under the law of the State of California, in which the parties lived. Nevertheless we are of opinion that the Commissioner and Board of Tax Appeals were right.

The Revenue Act of 1918 approved February 24, 1919, c. 18, §§ 210, 211, 212(a), 213(a), 40 Stat. 1057, 1062, 1064, 1065, imposes a tax upon the net income of every individual including 'income derived from salaries, wages, or compensation for personal service * * * of whatever kind and in whatever form paid,' § 213(a). The provisions of the Revenue Act of 1921, c. 136, 42 Stat. 227, 233, 237, 238, in sections bearing the same numbers are similar to those of the above. A very forcible argument is presented to the effect that the statute seeks to tax only income beneficially received, and that taking the question more technically the salary and fees became the joint property of Earl...

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1196 practice notes
  • Farmers Cooperative Co. v. Birmingham, Civ. No. 537.
    • United States
    • United States District Courts. 8th Circuit. Northern District of Iowa
    • October 8, 1949
    ...such assignments and agreements. Helvering v. Horst, 1940, 311 U.S. 112, 61 S.Ct. 144, 85 L.Ed. 75, 131 A.L.R. 655; Lucas v. Earl, 1930, 281 U.S. 111, 50 S.Ct. 241, 74 L.Ed. 731; Fontana Power Co. v. Commissioner, 9 Cir., 1942, 127 F.2d 193; Saenger v. Commissioner, 5 Cir., 1934, 69 F.2d 63......
  • Apt v. Birmingham, Civ. No. 424.
    • United States
    • United States District Courts. 8th Circuit. Northern District of Iowa
    • March 25, 1950
    ...from labor, or from both combined, including profit gained through the sale or conversion of capital assets. In Lucas v. Earl, 1930, 281 U.S. 111, 50 S.Ct. 241, 74 L.Ed. 731, the Supreme Court, speaking through Justice Holmes, refused to allow a husband to escape taxes on his income by way ......
  • Caruth v. US, Civ. A. No. 3-84-0877-R.
    • United States
    • United States District Courts. 5th Circuit. United States District Courts. 5th Circuit. Northern District of Texas
    • October 20, 1987
    ...stock donated to the Community Chest.12 The Assignment of Income Doctrine The "assignment of income doctrine" took root in Lucas v. Earl, 281 U.S. 111, 50 S.Ct. 241, 74 L.Ed. 731 (1930); it grew under Blair v. Commissioner, 300 U.S. 5, 57 S.Ct. 330, 81 L.Ed. 465 (1937) and Helvering v. Hors......
  • Title Ins. Co. of Minnesota v. State Bd. of Equalization, No. A045664
    • United States
    • California Court of Appeals
    • June 24, 1991
    ...by contracts designed to prevent money when paid from vesting even for a second in the taxpayer who earned it. (Lucas v. Earl (1930) 281 U.S. 111, 115, 50 S.Ct. 241, 241, 74 L.Ed. 731.) The full amount of the premium therefore qualifies as an accession to wealth over which the title insurer......
  • Request a trial to view additional results
1195 cases
  • Farmers Cooperative Co. v. Birmingham, Civ. No. 537.
    • United States
    • United States District Courts. 8th Circuit. Northern District of Iowa
    • October 8, 1949
    ...such assignments and agreements. Helvering v. Horst, 1940, 311 U.S. 112, 61 S.Ct. 144, 85 L.Ed. 75, 131 A.L.R. 655; Lucas v. Earl, 1930, 281 U.S. 111, 50 S.Ct. 241, 74 L.Ed. 731; Fontana Power Co. v. Commissioner, 9 Cir., 1942, 127 F.2d 193; Saenger v. Commissioner, 5 Cir., 1934, 69 F.2d 63......
  • Apt v. Birmingham, Civ. No. 424.
    • United States
    • United States District Courts. 8th Circuit. Northern District of Iowa
    • March 25, 1950
    ...from labor, or from both combined, including profit gained through the sale or conversion of capital assets. In Lucas v. Earl, 1930, 281 U.S. 111, 50 S.Ct. 241, 74 L.Ed. 731, the Supreme Court, speaking through Justice Holmes, refused to allow a husband to escape taxes on his income by way ......
  • Caruth v. US, Civ. A. No. 3-84-0877-R.
    • United States
    • United States District Courts. 5th Circuit. United States District Courts. 5th Circuit. Northern District of Texas
    • October 20, 1987
    ...stock donated to the Community Chest.12 The Assignment of Income Doctrine The "assignment of income doctrine" took root in Lucas v. Earl, 281 U.S. 111, 50 S.Ct. 241, 74 L.Ed. 731 (1930); it grew under Blair v. Commissioner, 300 U.S. 5, 57 S.Ct. 330, 81 L.Ed. 465 (1937) and Helvering v. Hors......
  • Title Ins. Co. of Minnesota v. State Bd. of Equalization, No. A045664
    • United States
    • California Court of Appeals
    • June 24, 1991
    ...by contracts designed to prevent money when paid from vesting even for a second in the taxpayer who earned it. (Lucas v. Earl (1930) 281 U.S. 111, 115, 50 S.Ct. 241, 241, 74 L.Ed. 731.) The full amount of the premium therefore qualifies as an accession to wealth over which the title insurer......
  • Request a trial to view additional results
1 books & journal articles
  • The grantor trust rules: An exploited mismatch.
    • United States
    • The Tax Adviser Vol. 52 Nbr. 11, November 2021
    • November 1, 2021
    ...Research Paper No. 328, at 4-5 (April 6, 2011). (21) Ascher, "The Grantor Trust Rules Should Be Repealed," at 887. (22) Lucas v. Earl, 281 U.S. 111 (23) See also Helvering v. Horst, 311 U.S. 112 (1940). (24) Lucas, 281 U.S. at 115. (25) See Burnet v. Wells, 289 U.S. 670, 675 (1933): "By the......

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