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5 T.C. 1014

Converse v. Commissioner

United States Tax Court

Decided October 31, 1945

United States Tax Court · decided 1945-10-31

Gift Tax. -- Settlement at Divorce. -- A lump sum paid by a husband, pursuant to a court order, to his wife in connection with a divorce decree, was not a gift. Herbert Jones, 1 T. C. 1207, followed.

Relies on Commissioner v. Wemyss · Humes v. United States · Merrill v. Fahs

Good law ✅— No negative treatment on recordhow we know

Decision will be entered under Rule 50 · Decided 1945-10-31

How this case has been cited

Cited by 23 later decisions — most recently April 1973

2 federal appellate ·

1201945195019601970decided

Later decisions citing this case, by decade. The current decade is in progress, and our corpus holds fewer opinions from the most recent years, so the latest bars are undercounted — not a real decline.

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Turner, J.,

¶1dissenting: In reaching its conclusion herein, the Court seeks to avoid the impact of the decisions of the Supreme Court in Commissioner v. Wemyss, 324 U. S. 303, and Merrill v. Fahs, 324 U. S. 308, by pointing out that in those cases the Court was dealing wjth antenuptial agreements, while in Herbert Jones and in this case we were and are dealing with postnuptial agreements. In all of the above cases t he ultimate question is the same, namely, whether surrender of marital rights constitutes consideration in money or money’s worth within the meaning of the gift tax statute. That the Supreme Court intended to pass on the ultimate question in Merrill v. Fahs without regard to the fact that the rights of the donee, at the time of the agreement, were contingent upon the subsequent marriage of the parties, the agreement in that case being antenuptial, is in my opinion definitely indicated by the following statement from the Court’s opinion:

We put to one side the argument that in any event Miss Demare’s contingent interest in her husband's property hud too many variables to be reducible to dollars and cents, and that any attempt to translate it into “money’s worth” was “mere speculation hearing the delusive appearance of accuracy.” Humes v. United States, 276 U. S. 487, 494. We shall go at once to the main issue.

¶2Thereupon the Court, as indicated in the dissent of Judge Arnold herein, proceeded to consider generally the question whether the surrender of marital rights constituted consideration in money or money’s worth within the meaning of the statute, and decided that it did not.

Arnold and Tyson, JJ., agree with this dissent.
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