McCaughn v. Carver, 3587.
| Decision Date | 27 April 1927 |
| Docket Number | No. 3587.,3587. |
| Citation | 19 F.2d 126 |
| Parties | McCAUGHN, Collector of Internal Revenue, v. CARVER. |
| Court | U.S. Court of Appeals — Third Circuit |
T. H. Lewis, Jr., and A. W. Gregg, both of Washington, D. C., for plaintiff in error.
Wm. Clarke Mason and Alex Henry Carver, both of Philadelphia, Pa., for defendant in error.
Before BUFFINGTON, WOOLLEY, and DAVIS, Circuit Judges.
This case concerns the taxation of a trust fund created by J. Henry Carver, who died November 30, 1919. On December 18, 1906, he and his intended wife entered into a written antenuptial agreement in pursuance of which he then transferred and paid over to Charles Carver as trustee $40,000 in trust to pay the income thereof to himself for life, thereafter to pay the income to his intended wife during her life or until remarriage, and thereafter to pay the principal to his children, if any, and in default thereof to pay it to such uses and purposes as he might by his will appoint. By the same instrument his intended wife waived all interest in his estate. The instrument was irrevocable, and continued in effect until the death of J. Henry Carver, from which time the income has been paid to his wife. In March, 1922, the Commissioner of Internal Revenue assessed against Charles Carver, as executor of J. Henry Carver's estate, the taxes here in question on the sum so held in trust under the agreement, claiming to do so by section 402, subsection (c), of the Revenue Act of 1918 (Comp. St. § 6336¾c). The tax was paid under protest, and the present suit brought to recover, which recovery was allowed by the court below, and judgment entered against the collector. To review this judgment the present writ of error was sued out.
The pertinent part of section 402, provides: "That the value of the gross estate of the decedent shall be determined by including the value at the time of his death of all property * * * (c) to the extent of any interest therein of which the decedent has at any time made a transfer, or with respect to which he has at any time created a trust * * * except in case of a bona fide sale for a fair consideration in money or money's worth." The question here involved is whether this transaction is aptly described by the language "a bona fide sale for a fair consideration * * * or money's worth." It will be observed that this is not the case of a unilateral transfer of property for the benefit of another. It is in no sense a gift, but it is a contract in which each party surrenders some...
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...a transfer in contemplation of death, and it had been decided in the affirmative, Ferguson v. Dickson, 3 Cir., 300 F. 961; McCaughn v. Carver, 3 Cir., 19 F. 2d 126; Stubblefield v. U. S., Ct.Cl., 6 F. Supp. 440, and also in the negative, Mercantile Trust Co. v. Hellmich,1 T.D. 3545 III-1 Cu......
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...1934). Accord, Ferguson v. Dickson, 300 F. 961 (3d Cir.), cert. denied, 266 U.S. 628, 45 S.Ct. 126, 69 L.Ed. 476 (1924); McCaughn v. Carver, 19 F.2d 126 (3d Cir. 1927). The instant situation is not among those to which Congress in section 2043(b) has ...
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Commissioner of Internal Revenue v. Bristol, 3658.
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