Warner v. Walsh, 65.
| Decision Date | 08 November 1926 |
| Docket Number | No. 65.,65. |
| Citation | 15 F.2d 367 |
| Parties | WARNER v. WALSH, Collector of Internal Revenue. |
| Court | U.S. Court of Appeals — Second Circuit |
Marsh, Stoddard & Day, of Bridgeport, Conn. (Paul Armitage and Edward Holloway, both of New York City, of counsel), for plaintiff in error.
John Buckley, U. S. Atty., and John A. Danaher, Asst. U. S. Atty., both of Hartford, Conn. (A. W. Gregg, Gen. Counsel, Bureau of Internal Revenue, and T. H. Lewis, Jr., Sp. Atty., Internal Revenue, both of Washington, D. C., of counsel), for defendant in error.
Ver Planck, Prince, Burlingame & Lightner, of New York City (John L. Kennedy, of Omaha, Neb., Albert L. Hopkins and J. C. Halls, both of Chicago, Ill., and Edward Holloway, of New York City, of counsel), amicus curiæ.
Before HOUGH, MANTON, and MACK, Circuit Judges.
Under the will of plaintiff's deceased husband, a large and ample trust fund was created, out of the income, and, if necessary, out of the principal, of which plaintiff was to receive $50,000 a year for life. This provision was expressly made in lieu of her statutory rights in the estate under the laws of Connecticut and was so accepted by her. She personally was compelled to pay federal income tax on the $50,000 for each of the years 1917 and 1918. Her claims for refund were rejected. A demurrer to her complaint, seeking recovery of the taxes so paid, was sustained, and the complaint dismissed, on the authority of Irwin v. Gavit, 268 U. S. 161, 45 S. Ct. 475, 69 L. Ed. 897.
The conditions in the two cases are not, however, as the District Judge stated, identical; on the contrary, in the Gavit Case there was absent the vital element, present here, of a very valuable consideration for the so-called bequest, the widow's relinquishment of her statutory rights. There the sole question was whether income, payable to a son-in-law quarter-annually for life, but not exceeding a number of years, out of a trust fund created by the will, was property acquired by bequest or income within the meaning of the revenue acts; here the question is whether an annuity, payable first out of income, but, if necessary, out of principal, of a similar trust fund, but acquired solely in lieu of, and in consideration for, the relinquishment of valuable statutory rights in the estate, is income, bequest, or annuity. If it be a bequest, it would be exempt under Revenue Act 1916, § 4 (39 Stat. 758), as amended by Revenue Act of 1917, § 1200 (40 Stat. 329 Comp. St. § 6336d) and Revenue Act 1918, § 213b (3), being 40 Stat. 1065 (Comp. St. § 6336 1/8ff, if a purchased annuity, it is not taxable until its cost has been returned. Revenue Act 1916, § 4; Revenue Act 1918, § 213b (2).
We need not consider whether it is a bequest; furthermore, we need not consider...
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Proctor v. White
...The Commissioner made his decision relying upon the cases of United States v. Bolster, 26 F.2d 760, 59 A.L.R. 491, and Warner v. Walsh, 2 Cir., 15 F. 2d 367, later overruled by the case of Helvering v. Butterworth, 290 U.S. 365, 54 S.Ct. 221, 78 L.Ed. 365. Deductions were allowed in respect......
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Smith v. United States
...U.S. 365, 54 S.Ct. 221, 78 L. Ed. 365, which overruled the earlier contrary decisions of three Circuit Courts of Appeals in Warner v. Walsh, 2 Cir., 15 F.2d 367, United States v. Bolster, 1 Cir., 26 F.2d 760, 59 A.L.R. 491, and Allen v. Brandeis, 8 Cir., 29 F.2d 363, the assessments made ag......
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Warner v. Walsh
...for defendant. THOMAS, District Judge. The opinion of this court (10 F.2d 155) and the reversing opinion of the Circuit Court of Appeals (15 F.2d 367) render unnecessary a restatement of the facts in this case. By a stipulation of facts filed June 14, 1927, which was entered into for the pu......
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United States v. Green
...error alleged by the plaintiff is the Commissioner's acceptance of the interpretation of the statute by the Circuit Courts in Warner v. Walsh, 2 Cir., 15 F.2d 367; United States v. Bolster, 1 Cir., 26 F.2d 760, 59 A.L.R. 491; Allen v. Brandeis, 8 Cir., 29 F.2d 363, in which cases it was hel......