Belcher v. Commissioner

*1296OPINION.

Van Fossan :

The petitioner has cited numerous statutes and cases to show that husband and wife in California may contract freely with each other relative to their properties, and by express agreement may render the wife’s earnings her separate property. The respondent does not dispute these contentions, but points out that in this case there is no evidence of an agreement that Mrs. Belcher’s earnings should be her separate property. With this we agree. The agreement entered into was that the earnings of both parties should be pooled and be the joint property of both. In the language of the parties “ everything was to be fifty-fifty.” This is not an agreement that the property should be the separate property of each and does not create an exception to the general rule that,

Community property is property acquired by husband or wife, or either, during- marriage, when not acquired as the separate property of either. Section 687, Civil Code of California.

In the absence of an agreement that their earnings should be separate property it can not be questioned that the earnings of either spouse are community property. (See Fennell v. Drinkhouse, 131 Cal. 447; 63 Pac. 734.) As said by the Circuit Court of Appeals recently in a case strikingly similar to this—

At the instant they were received, the salaries were, by the law, impressed with the status of community property and were taxable with reference to that status. Blwir v. Roth, 22 Fed. (2d) 932.

In that case the court reversed the decision of the Board and stated that the reasoning used in the Estate of George W. Randall, 4 B. T. A. 679, on which case our decision in the Roth case was based, was unsound. See also Guy C. Earl, 10 B. T. A. 723. As community *1297property, Mrs. Belcher’s earnings are taxable to the petitioner when received. United States v. Robbins, 269, U. S. 315.

There was no error in respondent’s determination of the deficiencies.

Reviewed by the Board.

Judgment will be entered for the respondent.