Phipps v. Helvering’s Empirical Analysis

Citation profile

3 federal appellate · 3 state decisions

Most-quoted passages

The sentences later courts lift from this opinion, ranked by how many decisions quote each — the parts of the opinion doing the work. These counts are smaller than the citation total above because most of the 9 citing decisions cite the case generally; a passage count includes only decisions quoting that exact language verbatim.

1. ““§ 167. Income for benefit of grantor. “(a) Where any part of the income of a trust — ■ “(1) is, or in the discretion of the grantor or of any person not having a substantial adverse interest in the disposition of such part of the income may be, held or accumulated for future distribution to the grantor; or “(2) may, in the discretion of the grantor or of any person not having a substantial adverse interest in the disposition of such part of the income, be distributed to the grantor; or “(3) is, or in the discretion of the grantor or of any person not having a substantial adverse interest in the disposition of such part of the income may be, applied to the payment of premiums upon policies of insurance on the life of the grantor (* * *);”

   2 later decisions quote this exact passage
   e.g. Commissioner v. Jergens · Commissioner of Internal Revenue v. Jergens

2. “In effect, both the taxpayer and the district court would read Section 167 as though it provided that the trust income is taxable to the grantor if it “is unconditionally held or accumulated for future distribution to the grantor.” We find no justification for such a construction either in the language of * * * [section] 167 or in the purpose of Congress in enacting Section 167. Indeed, when we consider that Congress was dealing with the problem of eliminating the use of the trust device as a means of avoiding surtaxes we can hardly think that it intended to weaken the effectiveness of the remedy it was devising by making it applicable only when the right of a grantor to accumulations of trust income was vested or unconditional. To read into the section so restricted a meaning is to destroy its practical utility as a means for preventing tax avoidance. It is our duty to construe the statutory language as -written. Nowhere in Section 167 is there any suggestion that the accumulations of trust income must actually be distributed to the grantor in order to make the section applicable. * * * Nor is there any suggestion in the section that the trust income must be held or accumulated exclusively for the grantor. The plaintiff is not only one of a number of persons to whom distribution may eventually be made but in fact is the presumptive taker of the trust accumulations. As a practical matter, so long as the plaintiff is alive the accumulations of the trust income are for him. And”

   1 later decision quote this exact passage
   e.g. Wadewitz v. Commissioner