dissenting: The facts being as they are, I find myself unable to see in the payments made by the foundation to the petitioner the transfer and receipt of a gift, excludible from gross income under section 22 (b) (3) of the Internal Revenue Code of 1939, and not the receipt of compensation for services rendered, which is gross income under section 22 (a).
In making his proposal to the foundation, petitioner made the claim that he had to earn a living for himself and family, and could take time to do the work outlined only if the foundation would agree to make specified payments therefor to supplement his sabbatical salary and other income, and by the terms of the agreement reached, and under which the payments here in question were made, the foundation became obligated to make the payments only when and as the services were performed. Furthermore, the agreement was to run for a period of 12 months from September 1,1950, at a “stipend”1 of $3,000. Petitioner could engage in no other occupation during that time, and only the foundation had the right to waive the conditions specified. In short, the performance of the services or the doing of the work agreed upon was a prerequisite, or the quid pro quo, for the money received. It falls squarely within the provisions of section 22 (a), wherein it is provided that “gross income” includes “income derived from salaries, wages, or compensation for personal service * * * of whatever kind and in whatever form paid, or from professions, vocations,” etc.
Seemingly, there is a natural urge to say that payments which serve to promote the development of literature and art are free of tax burdens. But whether or not they are so free, is a matter which Congress alone has the rightful power and authority to determine, and in keeping therewith, Congress has made provision in the Internal Revenue Code for the exemption of corporations, funds, and foundations which are engaged exclusively, and not for profit, in educational and literary work. It has also seen fit to allow to taxpayers, subject to certain limitations, deductions for contributions made to such corporations, funds, or foundations, but at no place has it exempted compensation, salaries, or stipends paid to individuals who are working for or under the foundations in carrying on such educational or literary work. To the contrary, the stipend or compensation of such individuals is included i'n the broad definition of gross income under section 22 (a).2 That the net result in a case such as this might be beneficial to the public as a whole is no more ground for exemption of the stipend or compensation from income tax, than in the case of the recompense of a social worker, community chest employee, or teaching fellow at a university, or other paid workers in or under the Guggenheim Foundation itself. It would be quite difficult to imagine any case where the advancement of public interest only was more wholly the sole objective of the work to be done, than in the case of the composer whose compensation as taxable income was in question in Robertson v. United States, 343 U. S. 711. In that case, nevertheless, the Supreme Court held, in language even more forcibly applicable here, that the payment was made under a contract for services rendered and, as such, was taxable income. However strong the feeling or desire may be that the doing of such work as that herein be fostered and promoted, we must leave to Congress the prerogative of saying that compensation for services rendered in the doing of such work is to be free from taxation. In my opinion, Congress has not so provided.
Murdock, Opper, LeMire, and Fisher, JJ., agree with this dissent.In Webster’s New International Dictionary, the word “stipend” is defined as “Settled pay or compensation for services, whether paid- daily, monthly, or annually,” and under synonyms, the only reference is “See Wages.”
See, however, section 117 of the Internal Revenue Code of 1954, wherein for taxable years beginning after December 81, 1953, Congress has, subject to certain, conditions and limitations, specifically excluded from gross income in the case of an individual any amount received as a scholarship at an educational institution, or as a fellowship grant.