United States v. Manufacturers Nat’l Bank, 363 U.S. 194 (1960)

United States v. Manufacturers National Bank of Detroit

No. 350

Argued March 31, 1960
Decided June 13, 1960
363 U.S. 194

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF MICHIGAN

Syllabus

In 1936, respondent’s decedent divested himself of his rights in certain insurance policies on his own life by assigning them to his wife, but he continued to pay the premiums on them until he died in 1954. The Internal Revenue Service determined that, under § 811(g)(2)(A) of the Internal Revenue Code of 1939, the portion of the proceeds attributable to premiums paid by the insured after January 10, 1941, should be included in his estate for the purposes of the federal estate tax.

Held: as thus applied, § 811 (g)(2)(A) is constitutional. Pp. 194-201.

(a) The tax is not a direct tax on property which Congress cannot exact without apportionment among the States. Pp. 197-200.

(b) The tax is not retroactive, and does not violate the Due Process Clause of the Fifth Amendment. Pp. 200-201.

175 F. Supp. 291 reversed.