United States v. Stapf, 375 U.S. 118 (1963)

United States v. Stapf


No. 54


Argued October 23-24, 1963
Decided December 2, 1963
375 U.S. 118

CERTIORARI TO THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT

Syllabus

Respondents’ decedent died in 1953 a resident and domiciliary of Texas. In addition to his separate estate, he owned a larger amount of property in community with his wife. His will required that his widow elect either to retain her one-half interest in the community property or to take under the will and allow its terms to govern the disposition of her community interest. If she elected to take under the will, she would be given, after specific bequests to others, one-third of the community property and one-third of her husband’s separate estate; she would allow her one-half interest in the community property to pass into a trust for the benefit of the children; and the executors would pay "all, and not merely one-half" of the community debts and administration expenses. She elected to take under the will, and actually received less than she would have received had she retained her interest in the community property.

Held:

1. Since the widow gave up more than she received, the estate is not entitled to any marital deduction under § 812(e) of the Internal Revenue Code of 1939. Pp. 123-129.

2. Since half of the claims against the estate were chargeable to the widow’s half of the community property, such claims could not be deducted in full from the decedent’s gross estate as "claims against the estate," within the meaning of § 812(b)(3). Pp. 130-133.

3. That portion of the administration expenses which was chargeable to the widow’s share of the community property could not be deducted from the value of the estate as "administration expenses" under § 812(b)(2). Pp. 133-134.

4. Even if the testator’s assumption of responsibility for his wife’s share of the community debts and for her share of administration expenses were treated as marital gifts, rather than as claims or expenses, no marital deduction could be allowed under § 812(e) on account of such gifts, because the widow gave up more than she received. Pp. 134-135.

309 F.2d 592, reversed and remanded.