Alfred v. Commissioner of Internal Revenue

574 F.2d 1332 78-2 USTC P 9515 ALFRED I. DuPONT TESTAMENTARY TRUST, the Florida National Bank of Jacksonville, Edward Ball, William B. Mills, J. C. Berlin, T. S. Coldewey, W. L. Thornton, and Alfred D. Dent, Trustees, Petitioners-Appellants, v. COMMISSIONER OF INTERNAL REVENUE, Respondent-Appellee. No. 76-3591. United States Court of Appeals, Fifth Circuit. June 15, 1978. Herbert R. Berk, Patrick J. Murphy, Jeffery Dissin, New York City, for petitioners-appellants. Myron C. Baum, Acting Asst. Atty. Gen., Gilbert E. Andrews, Act. Chief, App. Section, U. S. Dept. of Justice, Ernest J. Brown, Atty., Meade Whitaker, Chief Counsel, I. R. S., Ann Belanger Durney, Atty., Jane M. Edmisten, Atty., Tax Div., Dept. of Justice, Washington, D. C., for respondent-appellee. Appeal from the Decision of the Tax Court of the United States. Before BROWN, Chief Judge, AINSWORTH and VANCE, Circuit Judges. PER CURIAM: — 1 — This appeal is taken from the Tax Court decision rendered after remand from this Court. In 1974, the Tax Court upheld the Commissioner's disallowance of deductions claimed by the taxpayer, a testamentary trust created under the will of Alfred I. DuPont, for expenses paid in 1966 or 1967 to maintain an estate used as a residence by Mrs. DuPont for part of each year. This Court held that the Tax Court correctly ruled that the expense of maintaining the estate could not be deducted as ordinary and necessary expenses under section 212 of the Int. Rev. Code of 1954, as expenses related to rental property, expenses related to property held for the production of income, or as expenses incurred in the management of trust property. Alfred I. DuPont Testamentary Trust v. Commissioner of Internal Revenue, 5 Cir., 1975, 514 F.2d 917. On that appeal, the taxpayer contended for the first time that the trust could deduct the expenditures under section 651 or 661, as distributions of income to the beneficiary. We remanded the case to the Tax Court to decide the right of the trust to deduct the expenditures under these sections. — 2 — On remand, the Tax Court considered the applicability of sections 651 and 661 and again disallowed the deduction. Alfred I. DuPont Testamentary Trust, 66 T. C. 761 (1976). We agree with the holding of the Tax Court and affirm on the basis of its opinion. — 3 — AFFIRMED.