Estate of Hornor v. Commissioner

Mulroney, J.,

concurring: The sole inquiry in this case is the value of the property that is to be included in Julia’s estate under section 811 (c) when she died in 1954. The fact that the value of some or all of the same property was included in William’s estate under another statute (sec. 811 (e), not here involved), when he died nearly 20 years earlier, is of no consequence. Section 811(c) reaches the value of property transferred by a decedent “at any time” in which the decedent retained the life income. Here we have property which at the time of Julia’s death was held in an irrevocable trust whereby she had the right to income for life. Julia had transferred tins property to the trust so the statute clearly applies.

The next inquiry is as to the amount of value that is to be included. The statute provides it is the value of the property to the “extent of any interest therein of which the decedent [Julia] has at any time made a transfer” to the trust. The extent of the interest she transferred was a joint tenancy interest. This is a one-half interest under the rule of Estate of A. Carl Borner, 25 T.C. 584, Sullivan's Estate v. Commissioner, 175 F. 2d 657, and Brockway's Estate v. Commissioner, 219 F. 2d 400. No inquiry is made or need be made under section 811(c) as to which joint owner furnished the consideration for property. That inquiry is pertinent only under section 811(e) where, at the time of death, decedent was a joint owner. The William Mac-pherson Hornor case merely held the decedent was actually a joint owner, and a transfer that remained revocable up until his death was, for tax purposes, ineffectual to change his interest from what it was before the transfer. This holding rendered the entire estate taxable under section 811(e) upon proof of his furnishing the consideration for the property. A similar holding cannot be made here for the trust was made irrevocable before Julia died upon the happening of an event. No one contends Julia at the time of her death owned property in joint ownership. We have a different statute and in effect a different trust instrument than the statute and trust instrument involved in the William Macpherson Hornor case.

The transfer was not complete when made to a revocable trust, which is the full force of the holding in the William Macpherson Hornor case, but it was made complete before Julia died by the happening of an event that rendered the trust irrevocable, namely, William’s death. The interest in property which a joint owner conveys by a joint conveyance is the same as if the joint owners were tenants in common. Sullivan's Estate v. Commissioner, supra. Julia’s conveyance to the trust, which became irrevocable many years before her death, brought into the trust one-half of the corpus and that is the measure of the inclusion of value under section 811(c).

Forrester, J., agrees with this concurring opinion.