HOLTZ'S ESTATE V. COMMISSIONER 38 T.C. 37 (1962) CASE BRIEF

HOLTZ'S ESTATE V. COMMISSIONER

38 T.C. 37 (1962)

NATURE OF THE CASE: This is an appeal of an assessment of gift tax. Holtz's Estate (P) sought review of a decision by the IRS which determined deficiencies in gift tax against the estate.

FACTS: Settlor created an inter vivos trust. During his lifetime, the income from the trust was to be paid to Settlor, as was that portion of the principal which the trustee deemed to be desirable for the Settlor's comfortable support, or for his emergency needs. Upon Settlor's death, the income was payable to his wife for her life, if she survived him, and it contained a similar provision with respect to invasion of the principal for her benefit. Upon the death of both Settlor and his wife, the trust was to terminate, and the income distributed to the survivor's estate. During his life, Settlor transferred assets into the trust. The Commissioner (D) determined that these constituted taxable gifts, and assessed a tax against Settlor based on the amount of the transfer, less Settlor's interest in the trust. Settlor's estate (P) contends that the transfers were not completed gifts at the time they were made, and were therefore not taxable to Settlor as gifts.

ISSUE:

RULE OF LAW:

HOLDING AND DECISION:

LEGAL ANALYSIS:

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