TAXATION-TRANSFER TAX ON DEATH OF SETTLOR OF TRUST WHERIN INCOME WAS RESERVED

Authors

Abstract

Section 401, Revenue Act of 1918 provided that in order to determine the transfer tax, there should be included in the gross estate "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, in contemplation of or intended to take effect in possession or enjoyment at or after his death * * *." The decedent transferred to her husband and others, as trustees, securities in trust to collect the income and pay the balance after discharging expenses to the husband for life, after his decease, to the decedent for life and after her decease, the trust property was to be distributed among her four children. On the death of the decedent, her executors were compelled to pay a transfer tax. Judgment in favor of the Collector of Internal Revenue was affirmed by the circuit court of appeals. Held, reversing the judgment that the trust here was not made in contemplation of death within the meaning of the Revenue Act as it was not testamentary in character and on the death of the decedent, no title in the property passed to the living for the title had been definitely fixed by the trust deed. May v. Heiner, United States Supreme Court, April 14, 1930.

Recommended Citation

TAXATION-TRANSFER TAX ON DEATH OF SETTLOR OF TRUST WHERIN INCOME WAS RESERVED, 29 Mich. L. Rev. 123 (1930).
Available at: https://repository.law.umich.edu/mlr/vol29/iss1/31