*2517 1. ESTATE TAX. - Held that under the Revenue Act of 1924 the proceeds of insurance policies taken out in 1907, 1908, and 1909, where the insured reserved the right to change the beneficiary, should be included in the gross estate.
2. Id. - Contention that the proceeds of one particular policy should not be included is denied for lack of evidence.
3. INCREASE IN DEFICIENCY. - In view of section 308(e) of the Revenue Act of 1926, the respondent can not be held to have waived the right to include the proceeds of insurance policies by his failure to include them in determining the deficiency.
4. STATUTE OF LIMITATIONS. - Plea of statute of limitations disallowed because the evidence does not establish when the return was filed.
*1121 The respondent, by letter dated July 13, 1926, gave notice of the determination of a deficiency in estate tax under the Revenue Act of 1924 in the amount of $20,178.84, which deficiency arose out of the inclusion in decedent's gross eatate of the proceeds of certain insurance policies. A petitioner*2518 for redetermination of the deficiency was *1122 timely filed by the executors. The respondent, pursuant to a motion granted September 12, 1928, filed an amended answer averring, inter alia, that there should be included in decedent's gross estate the sum of $98,000 representing the proceeds of three life insurance policies issued by the Northwestern Mutual Life Insurance Co. and that the deficiency should accordingly be increased. Subsequently, counsel for petitioners, alleging that the deficiency had been paid, moved to dismiss the proceeding. This motion, upon objection of respondent's counsel, was denied.
FINDINGS OF FACT.
Petitioners are the executors and trustees of the estate of Louis Heilbroner, who died a resident of New York County, New York, on June 26, 1924.
The Northwestern Mutual Life Insurance Co. issued policies of insurance upon the life of decedent as follows:
| Policy No. | Date issued | Principal sum | Type of policy |
| 689477 | Jan. 31, 1907 | $25,000 | 20-payment life. |
| 766017 | Nov. 14, 1908 | 23,000 | Do. |
| 766016 | Nov. 13, 1909 | 50,000 | 10-payment life. |
In each of these policies decedent's wife, Helen H. Heilbroner, was named*2519 the beneficiary "subject," as stated in the policy "to the right of the insured, hereby reserved, to change the Beneficiary or Beneficiaries." Each of the policies bears an endorsement dated March 13, 1924, wherein decedent's wife was named beneficiary and his three children were named "contingent beneficiaries." Provision was also made for the distribution of the share of the "contingent beneficiaries" upon the death of any of them. The endorsement on each policy concluded with the following provision:
The right to change or revoke the foregoing designation is hereby reserved to the insured. It is hereby expressly agreed that the further right is reserved to the insured to make loans from the Company upon security of this policy, or to surrender the same for its cash value, without the consent or participation of any beneficiary or contingent beneficiary not now or hereafter irrevocably designated.
OPINION.
ARUNDELL: Petitioners' arguments against the application of the taxing statute so as to include in decedent's estate the proceeds of insurance policies taken out prior to the enactment of the law are disposed of by the principles laid down in *2520 , and . The former case holds that the proceeds of insurance policies *1123 on decedent's life taken out while the Revenue Act of 1921 was in effect should be included in the gross estate, and the principles established in that case are applied in the Northern Trust Co. case to revocable trusts created before the enactment of the statute, because "a transfer made subject to a power of revocation in the transferor, terminable at his death, is not complete until his death" and hence the taxing act "is not retroactive since his death follows the passage of the statute."
Petitioners' counsel in his brief concedes that under the Chase National Bank case the proceeds of all policies taken out after the enactment of the Revenue Act of 1918 are to be included in the gross estate. This concession he says covers all, save one, of the policies which gave rise to the deficiency asserted by respondent in his notice of deficiency. That one policy, he says, was taken out before the passage of the 1918 Act. As to this claim there is no evidence. *2521 The only evidence in the proceeding consists of copies of the three Northwestern Mutual Life Insurance Co. policies, which the parties stipulated are true copies and may be deemed in evidence, and which we have heretofore considered.
Petitioners further contend that the respondent, by failing to include the proceeds of the three Northwestern Mutual policies in decedent's estate at the time of determining the deficiency, waived the right to include such proceeds subsequently. Section 308(e) of the Revenue Act of 1926 specifically gives this Board jurisdiction to redetermine a deficiency in tax greater than that determined by the respondent if claim for such greater amount "is asserted by the Commissioner at or before the hearing." This provision would have no meaning if the petitioners' contention were to prevail, and we are very clearly of the opinion that the respondent did not waive his right to secure an increase in the deficiency.
It is also contended that the respondent is barred from increasing the deficiency because he did not do so within three years from the filing of the estate-tax return. A sufficient answer to this is that there is no evidence as to when the return*2522 was filed.
Decision will be entered for the respondent under Rule 50.