Chrissie H. Woodhall, a Widow, Estate of W. Lyle Woodhall, Deceased, Chrissie H. Woodhall v. Commissioner of Internal Revenue

W. Lyle Woodhall died on January 20, 1964, leaving Mrs. Woodhall as his sole heir and executrix. For 1964, Mrs. Woodhall filed a joint income tax return as surviving spouse. She also filed a fiduciary income tax return for the estate for part of 1964. For 1965, she filed an individual tax return and a fiduciary return.

The Commissioner of Internal Revenue determined deficiencies against Mrs. Woodhall for the years 1964 and 1965. The ground was that she had not declared as income certain amounts which came to her from the sale of her husband’s interest in a partnership. Mrs. Woodhall petitioned the Tax Court for a declaration that she did not owe the deficiencies. The Tax Court upheld the Commissioner’s determination and Mrs. Woodhall appeals. We affirm.

From January 1958 until his death, Woodhall was equal partner with his brother, Eldon Woodhall, in a lath and plaster contracting business known as Woodhall Brothers.

In December 1961, the brothers executed a written buy-sell agreement, which provided that “upon the death of either partner the partnership shall terminate and the survivor shall purchase the decedent’s interest in the partnership.” The price was to be determined…