United States v. Bank of America National Trust & Savings Ass'n

The United States appeals from a judgment in favor of the taxpayer in an action brought by the latter in the district court to recover taxes unlawfully collected, following denial of a claim for refund. The decision of the district court is reported at 203 F.Supp. 152 . We conclude that the judgment must be affirmed in part and reversed in part.

The facts are stipulated and, so far as material, are as follows: Appellee is trustee of a trust created under the last will and testament of Kernan Robson, deceased. It also was executor of the will of the decedent. The decedent died on January 13, 1956, a resident of California, and the will was probated in the Superior Court of that state, in and for the County of Marin. On October 15, 1956, the probate court made a decree *53 of preliminary distribution under the terms of which certain property of the estate, specifically described, was distributed to the trustee. All of the property distributed by this decree was corpus of the estate.

The will of the decedent creates a trust under which the trustee is required to hold, all of the corpus and pay the income to certain named beneficiaries. Upon termination of the trust, which must be…