OPINION.
Murdock :Tbe Commissioner determined a deficiency of $2,355.91 in the petitioner’s income tax for 1929. Tbe errors assigned are:
1. The inclusion in tbe petitioner’s gross income of tbe income of four irrevocable trusts established by tbe petitioner for four of his children who were minors.
2. The inclusion in the petitioner’s gross income of $15,029.14 as a dividend from a corporation of which he was the sole stockholder.
The facts have been stipulated.
*1083The petitioner is an individual, residing in Pennsylvania. On December SO, 1924, be executed a deed of trust creating irrevocable trusts for each of his eight children. The Willoughby Co., a corporation of Delaware, was named trustee and acted as such at all times material hereto. The petitioner was the sole stockholder of that corporation. The petitioner, in the trust instrument, transferred certain shares of stock to the trustee to be held in eight separate and equal trusts for his eight children by his wife, Elizabeth B.., which children were named in the trust instrument. The stock was transferred to the Willoughby Co. without any designation as trustee, and that company was given the power to sell the securities and to reinvest the principal without restriction, provided that the estate of each child should at all times be invested in the same securities as the estate of all of the others with certain exceptions not here material. Paragraph 3 of the agreement is as follows:
The income of each of said trusts shall be expended as it accrues for the maintenance, education and support of the beneficiary of such trust. Expenditures for tuition, clothing, taxes, board, lodging, traveling, entertainment and recreation shall be proper, and the written approval of any expenditure by Percy H. Clark or Elizabeth R. Clark, or either of them, shall be conclusive evidence that such expenditure is included among the purposes above specified. It is intended that the income of the trusts shall not be allowed to accumulate, and any income of any child not expended in any year shall be available for expenditure for the maintenance, education and support of such child in future years.
Each child was to have an allowance out of his or her share of the income of $40 a month beginning at the age of 16; $75 a month beginning at the age of 18; and $100 a month beginning at the age of 20 years. The principal of each son’s trust was to be paid to him when he attained the age of 25 years. The principal of each daughter’s trust was to be held during her life, but the full income of the trust was to be paid to her after she attained the age of 25 years. The trust instrument also provided for the disposition of the corpus of each trust in case a son died before reaching the age of 25 years or a daughter died at any time. In general, the principal was to go to the persons designated by the son or daughter or to their heirs. In case any child died unmarried and without issue while the trust was still in effect, the corpus of that trust was to be divided equally among the trusts for the surviving children. There was also provision for successor trustees to cover all eventualities.
Four of the children were minors at the close of the year 1929. The income from each trust for the minors during 1929 amounted to $799.61, or $3,198.44 for all four. The Commissioner included this income in the petitioner’s income for 1929.
The Commissioner contends that, because the petitioner was personally liable for the expenses of maintaining, educating, and sup*1084porting his minor children, the income of the trusts was in truth used for his benefit, he was the real beneficiary of the trusts, and, therefore, under section 162 (b)1 of the Revenue Act of 1928, the income of these four trusts should be included in computing his net income. The facts do not bring the case within the provisions of section 167. The word “ beneficiary ” as used in Supplement E must be accorded its usual meaning. That meaning is the meaning usually intended when the word is used in connection with trusts. The word refers to the four children, not to their father. The income is not taxable to the father. This is in accordance with the Commissioner’s rulings and regulations (C. B. 3, p. 116), and the decisions of the Board and the courts. Irene O'D. Ferrer, 20 B. T. A. 811; Lilian K. Blake, 23 B. T. A. 554; S. A. Lynch, 23 B. T. A. 435; Franklin Miller Handly, 30 B. T. A. 1271; Theodore P. Grosvenor, 31 B. T. A. 574; John H. Stevens, 24 B. T. A. 52. Cf. Emil Frank, 27 B. T. A. 1158; Edson v. Lucas, 40 Fed. (2d) 398.
The petitioner, on October 8, 1929, wrote to the Willoughby Co. as follows:
The' Willoughby Company holds in its No. 1 Account, as' part of the assets which it owns individually, fourteen hundred (1,400) shares of the common stock of the Portland Electric Power Company. I, as the owner of all of the stock of the Willoughby Company, request that Company to donate the said stock of the Portland Electric Power Company to my Children’s Trust, to be held in Willoughby No. 2 Account and to be administered as part of the assets held under the aforesaid Deed of Trust.
The directors of the Willoughby Co. met on October 8, 1929, and directed the transfer as requested. They took no other action with respect to this transfer. The stock so transferred was then of the value of $108,869.18. The earnings and profits of the Willoughby Co. accumulated after February 28, 1913, amounted to $15,029.74 on October 8, 1929. The Commissioner included $15,029.74 in the petitioner’s income for 1929 as a dividend from the Willoughby Co.
The petitioner controlled the Willoughby Co. It acted solely to accommodate him in making the transfer. He enjoyed the use of the property by having it transferred for his own purposes. This was the use he wanted to make of the property. He would have enjoyed it no more had it been distributed to him directly. The surplus of the corporation was wiped out. For income tax purposes the transaction amounted to the distribution of a taxable dividend, *1085to tbe extent of the earnings mentioned. Sec. 115 (a), (b); Security First National Bank of Los Angeles et al., Executors, 28 B. T. A. 289, 310, 311. Cf. Old Colony Trust Co. v. Commissioner, 279 U. S. 716.
Reviewed by the Board.
Decision will be entered wider Bule 50.
(b) There shall be allowed as an additional deduction in computing the net income of the estate or trust the amount of the income of the estate or trust for its taxable year which is to be distributed currently by the fiduciary to the beneficiaries, and the amount of the income collected by a guardian of an infant which is to be held or distributed as the court may direct, but the amount so allowed as a deduction shall bo included in computing the net income of the beneficiaries whether distributed to them or not. Any amount allowed as a deduction under this paragraph shall not be allowed as a deduction under subsection (c) of this section in the same or any succeeding taxable year.