Smith v. Westover, Collector of Internal Revenue

This is an appeal from a judgment in favor of the appellee Collector in an action brought by appellant for the recovery of a portion of the income tax paid by her for the taxable year 1944. The facts are adequately stated in the opinion of the District Court, Smith v. Westover, 89 E.Sttpp, 432, and need not be repeated here.

Upon presentation of the appeal primary emphasis was laid upon appellant’s contention that Internal Revenue 'Code, Sec. 162 (d) (1), 26 U.S.C.A..§ 162(d) (1), held controlling by the trial Court and to require payment by the appellant of the taxes here in question, cannot apply in the instant case for the reason that the testamentary trust' here involved had no “distributable income” within the meaning of that section. Appellant says that in this case there was no “distributable income” for the reason that the will required that the net income received shall be “immediately added to the principal or corpus of the said trust”. Thus, appellant says, the income was not “distributable” for the reason that it was to foe added to the corpus .rather than distributed to the beneficiary.

■ We think this contention is not tenable for -the reason that the same…