Mary Jane Gardiner, of the Estate of Laurabel Gardiner, Deceased v. United States

The government appeals the allowance of a charitable deduction, under 26 U.S.C. § 2055 (a) (2) (1964), to Mary Jane Gardiner, executrix of the estate of Laurabel Gardiner, deceased. We reverse.

By her last will and testament, Laura-bel Gardiner established a trust of her residuary estate. The entire net income of the trust was to be paid, in various proportions, to four members of her family, including her daughter, who was to serve as executrix and trustee. At the death of the last of the income beneficiaries, the remainder of the trust was to be paid to the Shriners Hospital, a charitable organization under 26 U.S.C. § 2055 (1964). Appellant disallowed in full a deduction taken by appellee. The district court held that the estate was entitled to the deduction. This appeal followed.

The Internal Revenue Code allows a deduction from the decedent’s gross estate for transfers made for charitable purposes, 26 U.S.C. § 2055 (a) (2). Where, as here, a testamentary trust is created for both private and charitable purposes, the Treasury Regulations provide for a charitable deduction only if at the time of the testatrix’s death the charitable interest is “presently ascertainable, and…