Robert A. Riddell, District Director of Internal Revenue, Los Angeles District, California v. M. Robert Guggenheim, Jr.

This is an appeal by the Director of Internal Revenue from a judgment of the United States District Court in favor of the taxpayer, M. Robert Guggenheim, Jr., in the latter’s suit to recover a portion of the sum paid by him as income tax for the years 1954 and 1955.

Plaintiff’s claim is that the twenty-four monthly payments made by him to Jean Guggenheim in the two taxable years mentioned were within the purview of those portions of 26 U.S.C.A. § 71 (a) (1) and (2) and § 215 that allow a deduction from gross income of periodic payments made by a taxpayer to his separated or divorced wife because of the marital or family relationship and the consequent general obligation to support such dependent.

Robert and Jean intermarried in 1950, but had separated and were living apart by March 9, 1953 when they entered into a written “Property Settlement Agreement”; shortly after the execution of that agreement Jean commenced an action for divorce in the State of California and was granted an interlocutory decree in April 1953 and a final decree on May 7, 1954; both decrees incorporated the property settlement agreement. The provision of that agreement under which the payments in question…