dissenting: I respectfully dissent from the majority opinion, which holds that the $11,093.05 insurance premiums which petitioner paid in 1937 and the $11,144.30 which she paid in 1938 were gifts of future interests. The policies of insurance themselves were irrevocably transferred by petitioner in 1932 to a trust for the benefit of her three sons. We do not have that gift before us, but I am perfectly willing to assume that it was a gift of future interests. That fact seems clear and I shall not attempt to argue otherwise. But the policies, although valuable property, were not self-perpetuating. Somebody had to pay the annual premiums in order that they should remain alive. In each of the taxable years petitioner paid the premiums. The Commissioner by his amended answer affirmatively alleges that in so doing petitioner made gifts to her three sons of the amounts of the premiums so paid and that these gifts were of future interests and no $5,000 exclusions are allowable. It seems clear that gifts were made all right and are taxable, but I am unable to see where such gifts partake in any manner of future interests.
Article 11 of Kegulations 79 defines future interests in property as follows:
* * * “Future interests” is a legal term, and includes reversions, remainders, and other interests or estates, whether vested or contingent, and whether or not supported by a particular interest or estate, which are limited, to commence in use, possession or enjoyment at some future date or time. * * * [Italics supplied.]
I am unable to see where a gift made to pay insurance premiums is limited to commence in use, possession, or enjoyment at some future date or time. It seems to me that it commences right now and its use and enjoyment are immediate.
It is true, of course, that petitioner’s three sons did not have the immediate use and enjoyment of the policies themselves or the proceeds thereof and that as to these things the gifts which had been made in a prior year were of future interests, but it is equally true, I think, that so far as the gifts of the money to pay the premiums are concerned there was immediate use and enjoyment.
Suppose, instead of making the payments of the premiums to the insurance companies, petitioner had given her three sons the cash with which to pay them. - Could it be contended that the gifts to them of the cash would be gifts of future interests ? I don’t think so. I can not see where the situation is changed any by the fact that petitioner, instead of giving the money to her sons, paid the premiums directly to the insurance companies, thus making indirect gifts to her three sons. In such a circumstance the trust was not the donee of the gifts. The three sons were the donees of the gifts, and I believe the gifts were no more gifts of future interests than they would have been if she had made them directly to her sons.
It must be conceded, of course, that the court decided in Commissioner v. Boeing, 123 Fed. (2d) 86, that gifts of the kind here made were of future interests, but, with all due respect to that court, I think that decision was wrong. In the Boeing case the court devoted the major part of its opinion to a discussion that the gifts of the policies themselves, which had been made in 1932, were gifts of future interests. Having arrived at that conclusion, the court held as a matter of course and without further discussion that the gifts of the premiums by Boeing in 1936 and 1937 to keep the policies alive were gifts of future interests. It is my view that the problem is not that simple.
For reasons I have stated above, I think that the gifts which petitioner made to her three sons in 1936 and 1937 in the payment of these insurance premiums were gifts of present interests and not future interests, and that the use and enjoyment to the sons were immediate and consisted in the present payment of insurance premiums to keep alive policies of insurance of which they were already the beneficial owners and in which they had very valuable rights which would be lost if the premiums were not paid.
Ttson, J., agrees with this dissent.