Memorandum Opinion
MURDOCK, Judge: The Commissioner determined a deficiency of $56,552.71 in estate tax. He included in the gross estate the value of property belonging to a trust created by the decedent on October 25, 1935. The respondent attempts to sustain that action upon one ground only, and the only issue for decision is whether that ground is a valid one. The facts have been stipulated.
The estate tax return was filed with the collector of internal revenue for the first district of Pennsylvania.
*48 [The Facts]
The decedent created a trust on October 25, 1943 and named himself and the Pennsylvania Company for Insurances on Lives and Granting Annuities as co-trustees thereof. The trustees were to pay the income of the trust to the decedent's wife for life and thereafter in equal shares to the decedent's children, all of whom were adults at the time. The income payable to a child was to be paid to his issue in case he died while the trust continued. The trust was to terminate upon the death of the last surviving child at which time the corpus was to be distributed among the grandchildren per capita. The decedent was survived by his wife, four adult children, and twelve grandchildren, all of whom were living at the time he created the trust, and also by two great grandchildren who were born after the creation of the trust.
The trust was irrevocable. It contained the following provisions:
"The said Trustees are authorized and empowered in the event of any accident, illness or other emergency, to use for the benefit of any beneficiary, such portion of the principal of this trust estate as may be necessary and advisable, the same in case of any descendant of the Settlor to*49 be charged in ultimate distribution against his or her share of the principal of this trust estate.
"Should any beneficiary hereunder at any time become mentally or physically incapacitated, the Trustees hereunder are authorized and empowered to use and expend that portion of the estate to which such beneficiary may be entitled, either principal or income, directly, in and about his or her maintenance and support without the intervention of a guardian or committee."
[Opinion]
The respondent contends that the two paragraphs quoted gave the decedent "the right to invade corpus and, accordingly, to shift the economic benefits of the trust to other children, grandchildren or great grandchildren, other than those to whom the benefits of the trust would accrue in the absence of the foregoing provisions." He attempts, to distinguish
The respondent conceded another issue.
Decision will be entered under Rule 50.