Nichols v. Coolidge
Mrs. Julia Coolidge, of Massachusetts, died January 6, 1921. As required by the Revenue Act approved February 24, 1919, c. 18, 40 Stat. 1057, 1096, the executors returned a schedule to the collector. He estimate the gross estate at $180,184.73 and allowed $77,747.74 deductions. They paid the amount assessed upon the balance. Their return did not include certain property transferred by the decedent through duly executed deeds and without valuable consideration, some to trustees and some directly to her children.
The Commissioner of Internal Revenue held that, under § 402(c), the value of all this property at her death must be included in the gross state. He raised the assessment accordingly, and demanded the additional tax $34,662.65 -- here challenged.
Section 402 directs that the gross estate shall be ascertained by including (among other things) the value at his death of all property "to the extent of any interest therein of which the decedent has at any time made a transfer, or with respect to which he has at any time created a trust, in contemplation of or intended to take effect in possession or enjoyment at or after his death (whether such transfer or trust is made or created before or after the passage of this act), except in case of a bona fide sale for a fair consideration in money or money's worth."
Concerning transfer of the residences in 1917, the trial court charged
“The effect of this transaction was to vest in the five sons named in the deed full and complete title to the property, including the right of disposition. They had a right to sell the property subject to the lease, and had all rights incident to ownership. There was here a gift completed during the lifetime of the donor. The act of 1918 did not purport to tax such gifts."
"I have reached the conclusion, therefore, that, respecting the property conveyed by the deed,