HELVERING V. FITCH, 309 U. S. 149 (1940)

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U.S. Supreme Court

Helvering v. Fitch, 309 U.S. 149 (1940)

Helvering v. Fitch

No. 243

Argued January 5, 8, 1940

Decided January 29, 1940

309 U.S. 149


1. A husband, creating a trust for the support of his wife, from whom he was separated, and in settlement of a suit brought by her for maintenance, transferred to a trustee in Iowa certain premises and a lease thereon. A stipulated amount of the income was to be paid monthly to the wife, and the trust was irrevocable. The husband reserved no interest in the trust estate (other than a life interest in the excess of income over the amount payable to the wife), and did not undertake to make good any deficiencies in payments to the wife. The arrangement was subsequently confirmed by an Iowa court in a decree of divorce.

Held, a distribution of such trust income to the wife (in 1933) was includible as income of the husband for the purpose of the federal income tax. Pp. 309 U. S. 150, 309 U. S. 156.

2. The general rule is that amounts paid to a divorced wife under a decree for alimony are not regarded as income of the wife, but as paid in discharge of the general obligation of the husband to support, which is made specific by the decree. Douglas v. Willcuts, 296 U. S. 1. P. 309 U. S. 151.

3. The burden of establishing that the present case was not within the general rule could be sustained only by clear and convincing proof, here lacking, that the effect of the Iowa law, the trust, and the divorce decree was a full and complete discharge of the obligation of the taxpayer for the support of his wife. P. 309 U. S. 156.

4. Query whether, under the Iowa divorce law, the court retained power to modify its decree by reallocating the income from the trust property as between the husband and wife. P. 309 U. S. 155.

103 F.2d 702, reversed.

Certiorari, 308 U.S. 535, to review the reversal of a decision of the Board of Tax Appeals, 37 B.T.A. 1330, sustaining a determination of a deficiency in income tax.

Page 309 U. S. 150

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