*200 Decision will be entered for the respondent.
Petitioner was divorced by his wife in 1936. She did not ask for alimony payments after divorce in her complaint, and was not awarded alimony in the decree of divorce. Prior to the divorce, upon separation, petitioner had an oral understanding with his wife that he would make payments for her support until she remarried. He made such payments in 1943 without being under legal obligation to do so under California law. Held, the payments in 1943 do not come within section 22 (k) of the Internal Revenue Code because they were not made in discharge of a legal obligation which was incurred by petitioner under a written instrument incident to the divorce.
*730 Respondent determined a deficiency in petitioner's income and victory tax for 1943 in the amount of $ 684.08. The sole question is whether respondent erred in disallowing deductions in 1942 and 1943 which petitioner claims under section 23 (u) of the Internal Revenue Code, as added by section 120 (b) of the Revenue Act of 1942.
Petitioner filed his return with the collector for the sixth district of California.
This proceeding was submitted under a stipulation of facts, a deposition, exhibits, and oral testimony.
FINDINGS OF FACT.
The facts which have been stipulated are found as stipulated. The stipulation and all of the attached exhibits are incorporated herein by this reference.
Petitioner resides in Los Angeles, California. Petitioner was married to Roselyn V. Myerson on September 6, 1923. Two children were born, Robert in 1925, and James in 1927. Petitioner and his wife lived together in Los Angeles until May 12, 1935, at which time they agreed to and did separate. After the separation, the children continued to live with their mother.
On May 17, 1935, Roselyn filed suit for divorce in the Superior Court, County of Los Angeles. On June*202 5, 1935, an interlocutory judgment of divorce in Roselyn's favor was entered in the Superior Court, upon default of her then husband. On June 6, 1936, Roselyn was granted a final decree of divorce. Subsequently, in 1945, Roselyn remarried.
When petitioner and his former wife separated in May 1935, no written separation agreement was executed other than an agreement relating to custody, which is set forth below. Petitioner had purchased a home for his family, and the property was subject to a mortgage. Title was taken in the names of the husband and wife. Petitioner turned over the home and furnishings to his wife, and also an automobile. Shortly after the separation petitioner and his wife consulted an attorney named Miller. He drafted an agreement which provided for the custody of the two minor children, giving the custody to the mother and providing that the father should have the privilege of having the minor children with him for part of each year. The agreement, dated May 27, 1935, was executed by petitioner and his wife. It did not contain any provision for the support of the wife and children. The agreement was as follows:
Witnesseth That:
Whereas, the parties hereto*203 are living separate and apart from each other, and
Whereas, it is the mutual desire of said parties to provide for the custody of their minor children;
*731 Now, Therefore, It Is Understood and Agreed by and between the parties hereto as follows:
That the party of the second part shall have the custody of said minor children, Robert Myerson, aged 10 years, and James Myerson, aged 8 years; provided, however, that the party of the first part shall have the privilege of having said minor children with him for sixteen (16) weeks during each calendar year, the time of said sixteen (16) weeks to be mutually agreed upon by the parties hereto from time to time.
That the parties hereto have made a verbal agreement as to the support of the party of the second part and said minor children, the terms of which are not set out in this Agreement.
In Witness Whereof, The parties hereto have hereunto affixed their names on the day and date first above written.
In 1935 petitioner was in very poor circumstances; he was having a financial struggle, had to borrow money, and did not have very much money. His then wife did not do anything other than look after her home and children, and she was not*204 employed during the years 1935 through 1943.
From the time of the separation until the final divorce in 1936, and after the divorce through the taxable years 1942 and 1943 petitioner paid the living, education, and medical expenses of the children and provided his former wife with money, in small amounts per week, to run her household. Roselyn Myerson had no means of support other than petitioner.
Since 1935 petitioner has taken care of his children's expenses. One of his sons is now attending Stanford University. From time to time the children have worked at petitioner's place of business.
In 1935 petitioner started a candy-manufacturing business. He rented the plant, but owned the equipment. He has put $ 21,000 into the business. He carries on business under the name of Ben Myerson Candy Co. In 1943 the gross receipts of this business were $ 53,233 and the net profit was $ 17,605. The salary which petitioner allowed to himself from the business in 1943 was $ 3,450.
In May of 1935, when petitioner and his wife separated, there was discussion about some provision for the support of the wife and children. Petitioner and his then wife did not want to enter into a written agreement*205 of support and maintenance at the time of the separation, or when the attorney, Miller, was consulted, or when the interlocutory and final decrees of divorce were entered. Miller suggested that the parties should include support and maintenance provisions in the written agreement of May 27, 1935, but neither party desired to do so, and neither party thought that it was necessary. When the divorce proceeding came on for trial, and petitioner defaulted, the judge who heard the divorce case asked Mrs. Myerson if she desired to have the decree of divorce include an order directing the petitioner to make payments for maintenance and support, and *732 she said that it was not necessary. Mrs. Myerson told the judge that she knew that her former husband would do what he had said that he would do for her and the children, and that his circumstances were not very good at the time.
At the time of the separation in May 1935, petitioner and his then wife had an understanding that he would pay the interest on the mortgage on the home in which she lived, that he would provide for the support of the children, and that he would provide for her support to the extent of a minimum of $ 25 a week, *206 which amount might be increased to a maximum of $ 50 a week, depending upon his circumstances. Such payments were to terminate in the event of the remarriage of Roselyn. Whenever Mrs. Myerson needed money she asked the children to ask their father to send money to her. Also, petitioner advanced money to her each week promptly. Each party endeavored to be reasonable and understanding about the respective circumstances of the other. Mrs. Myerson was not concerned at the time of the divorce about having an enforceable obligation against her husband; she was not worried about petitioner's attitude, but relied upon him and considered him to be a man of his word, thoroughly honest and dependable. The weekly amounts which petitioner paid to his wife, or former wife, varied during the entire period of 1935 through 1943.
During 1942 petitioner made payments to his former wife by check or by cash each week. In some weeks the payments would be 11, 15, 18, 20, or 25 dollars; and the payments made in some weeks were 30 or 40 dollars, and amounted to 50 dollars in one week. During 1943 the weekly payments were somewhat higher, usually exceeding 25 dollars per week, frequently amounting *207 to 30 dollars a week, and on two occasions the weekly payments were 120 and 200 dollars, respectively. The total amount of the payments made to his former wife in 1942 was $ 1,347.05 and in 1943 it was $ 1,886.15. The average weekly payments for 1942 and 1943 were $ 25 and $ 36, respectively.
The interlocutory judgment of divorce which was entered on June 5, 1935, awarded to petitioner's wife the custody of the two minor children and granted to the father the privilege of having the children with him for a stated period each year. The divorce decree adopted the paragraph relating to the custody which was set forth in the written agreement of May 27, 1935. The divorce decree did not make any mention whatsoever of a provision for the support of Mrs. Myerson and her children; and it did not direct the payment of alimony and support.
Petitioner deducted the amounts of $ 1,347.05 and $ 1,886.15 from his gross income in his Federal income tax returns for the years 1942 and 1943, respectively, as deductions for alimony payments under section 23 (u) of the Internal Revenue Code. Respondent disallowed *733 the deductions in each year, on the ground that "no legal obligation was imposed*208 upon or assumed by you to pay alimony to your divorced wife under the decree of divorce or a written instrument incident to such divorce as provided in section 22 (k) of the Internal Revenue Code."
The amounts paid by petitioner to his divorced wife in 1942 and 1943 were not paid in discharge of a legal obligation which, because of the marital relationship, was imposed upon or incurred by petitioner under the decree of divorce, or under a written instrument incident to such divorce.
OPINION.
The only question in this proceeding is whether payments made by petitioner during the years 1942 and 1943 are periodic payments within the meaning of section 22 (k) of the Internal Revenue Code. If the payments do not come within section 22 (k), petitioner is not entitled to deduction under section 23 (u).
Roselyn Myerson received a divorce from petitioner in 1936. The record in this case indicates that the complaint she filed in the divorce action did not make claim for alimony after divorce. The divorce decree did not grant her alimony. After the final divorce, petitioner was not under any legal obligation to pay alimony to his former wife for her support, in the absence of an order to *209 do so in the divorce decree. Howell v. Howell, 104 Cal. 45">104 Cal. 45; 37 Pac. 770.
Under section 22 (k) of the Internal Revenue Code there must be a legal obligation in the husband to make periodic payments of alimony to his wife after divorce. Petitioner must first establish that he was under such legal obligation in the taxable year, 1943. In order to establish this fact in this proceeding, petitioner argues that the written agreement of May 27, 1935, was a written separation agreement under which he became legally obligated to make payments to his former wife for her support after divorce and until her remarriage. The agreement has been set forth, in toto, in the findings of fact. It is clear in its terms. It is an agreement which relates only to the custody of the children. It does not satisfy the requirements of section 159 of the Civil Code of California1 as a contract in writing which would alter the legal relationship under California law relating to the husband's duty to support a wife. See Fitch v. Tyler (Cal. Sup. Ct., 1930), 288 Pac. 74; Wickersham v. Comerford, 96 Cal. 433">96 Cal. 433;*210 31 Pac. 358.
*734 When petitioner and his wife separated in 1935, they did not enter into a written separation agreement by the terms of which petitioner's legal obligation to support his then wife was established. She remained his wife, though separated from him, until June 6, 1936, when a final decree of divorce was granted to her; and during the period of separation, until final divorce, the legal obligation of petitioner to support her continued, unchanged by any written agreement under section 159 of the Civil Code of California. Upon entry of the final decree of divorce, *211 that obligation ended.
It is our understanding of the law of husband and wife in California that, if a wife relies upon a contract rather than upon a divorce decree as the source of a legal obligation in her husband to support her after divorce, such contract must be in writing, by virtue of the provisions of section 159 of the Civil Code. See Fitch v. Tyler, supra. Petitioner appears to recognize this rule of law. He contends that there was a written separation agreement which embodied provision for paying his former wife, after divorce, a minimum of $ 25 per week. The argument is that a clause at the end of the written agreement of May 27, 1935, incorporated an oral agreement into the written agreement by reference.
The argument is not sound, and it must be rejected. There was a clear and unambiguous agreement in writing on the custody of the children. There was an oral understanding on the support and maintenance of the wife and children which, for purposes of argument, we shall assume was an oral contract. The two agreements, written and oral, did not conflict. Neither did the oral agreement explain nor clarify the written agreement. *212 In this respect the cases of Sivers v. Sivers, 97 Cal. 518">97 Cal. 518; 32 Pac. 572; and Buckner v. A. Leon & Co., 267 Pac. 693, and like cases which petitioner cites are not in point under the questions presented. The theory of petitioner, founded upon a resort to the parol evidence rule, would not satisfy the requirements of a written agreement under section 159 of the California Civil Code. Fitch v. Tyler, supra.Also, we do not have here integration in a written agreement. See Restatement of the Law of Contracts, vol 1, p. 307, pars. 228, 240.
We must conclude, therefore, that there was no written agreement which obligated petitioner to support his former wife after entry of the divorce decree in June 1936, within the requirements of section 159 of the Civil Code. It follows that in 1943 petitioner was not under a legal obligation to make periodic payments of alimony to his wife within the meaning of section 22 (k) of the Internal Revenue Code.
If the legal obligation to pay alimony after divorce is not found in the divorce decree, it may be found in a contract, *213 and usually such contract is a separation contract. It may be true that an oral separation *735 agreement relating, inter alia, to support of the wife is enforceable in some jurisdictions; but in many jurisdictions such agreements, by statute, must be in writing. See 30 Corpus Juris 1061, par. 839.
The Congress has adopted the latter rule in section 22 (k) for purposes of the alimony deduction. Periodic payments (of alimony) must be in discharge of a legal obligation which is incurred by the husband under a written instrument incident to divorce, in order to come within the scope of section 22 (k). Petitioner was not making payments to his former wife in 1943 under a written instrument; there was none relating to support and maintenance. He adhered to his oral understanding which he had in 1935 as a matter of moral rather than legal obligation.
In this case two of the conditions precedent to obtaining a deduction for alimony payments under section 23 (u), read in conjunction with section 22 (k), are lacking; legal obligation in the husband, and a written instrument incident to the divorce. In any event, under section 22 (k), the legal obligation must be incurred*214 under a written instrument. It is held that the payments in question, which were made by petitioner in 1943 to his former wife, do not come within the scope of section 22 (k), and, therefore, deduction under section 23 (u) is denied. Cf. Frederick S. Dauwalter, 9 T.C. 580">9 T. C. 580.
Decision will be entered for the respondent.
Footnotes
1. Section 159, Civil Code of California -- Deering 1941:
"Sec. 159. (Contract altering legal relations: Separation agreement↩.) A husband and wife cannot by any contract with each other, alter their legal relations, except as to property, and except that they may agree, in writing, to an immediate separation, and may make provision for the support of either of them and of their children during such separation."