Black v. Commissioner

E. E. BLACK, PETITIONER, v. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT. Black v. Commissioner Docket No. 86961. United States Board of Tax Appeals 36 B.T.A. 346; 1937 BTA LEXIS 728; July 20, 1937, Promulgated *728 Income received in 1934 on corporate shares held by four trusts created by petitioner in 1933, of each of which petitioner's wife and three minor children were respective beneficiaries, held not taxable to petitioner in 1934, none of such income in that year having been used for the support and maintenance of the beneficiaries or in discharge of any other of petitioner's obligations. Livingston Jenks, Esq., for the petitioner. Arthur H. Fast, Esq., and Henry L. Young, Esq., for the respondent. STERNHAGEN *347 OPINION. STERNHAGEN: The Commissioner determined a deficiency of $2,559.56 in petitioner's individual income tax for 1934. Aside from minor adjustments which are not assailed, the Commissioner included in petitioner's income $8,000 dividends on corporate shares held by four trusts created by petitioner in 1933, of each of which petitioner's wife and three minor children were the respective beneficiaries. This inclusion the petitioner assails. We are of opinion that the Commissioner's determination is in error. The trusts were complete and irrevocable. Petitioner had no right to the income either presently or prospectively, *729 and none of it actually came to him. He did not benefit by its use for the support and maintenance of his wife and children or in discharge of any other of his own obligations (cf. ), and the trusts were at all times administered with a strict regard for their separate jural personalities (cf. ). There is no occasion, therefore, to regard the income as constructively received by petitioner. The uncontested adjustments will result in increasing the net income, and therefore require redetermination of the deficiency. Judgment will be entered under Rule 50.