Lois J. Newman (Formerly Lois J. Senderman) v. Commissioner of Internal Revenue

This is a petition to review a decision of the Tax Court adjudging a deficiency in gift tax of $50,079.84. The principal question presented is whether petitioner’s gift to her minor daughter was completed in 1943, when the property was transferred in trust for the minor, or in 1946, upon the termination of the trust and distribution of the property to the minor’s guardian.

The following is a summary of the findings of the Tax Court based in large part upon a stipulation of facts filed by the parties:

Prior to her second marriage in December, 1944, Petitioner’s name was Lois J. Senderman. She was divorced from her first husband in 1940. Her only child, a daughter named Lois E. Sender-man, was born on May 14, 1935. Petitioner had inherited from her parents 2,396-% shares of stock of Aztec Brewing Company (hereinafter “Aztec”), a California corporation. The stock certificates were in the name of her attorney, Richard S. Goldman (hereinafter “Goldman”), and early in January 1943 she instructed him to transfer and hold 800 shares in trust for her minor daughter. Goldman orally declared himself to be trustee of the trust effective immediately, and some six or seven months thereafter…