Milliken v. United States, 283 U.S. 15 (1931)

Milliken v. United States

No. 87

Argued January 29, 1931
Decided March 2, 1931
283 U.S. 15

CERTIORARI TO THE COURT OF CLAIMS

Syllabus

1. A finding by the Commissioner of Internal Revenue, in assessing an estate tax, that a gift made by the decedent in his lifetime was made in contemplation of death is controlling when the tax is called in question, if not challenged by any fact appearing of record. P. 19.

2. The Revenue Act of 1918, § 402, applies to gifts in contemplation of death made before its passage. P. 19.

3. The inclusion of gifts made in contemplation of death in a single class with decedents’ estates to secure equality of taxation, and prevent evasion of estate taxes, is a permissible classification of an appropriate subject of taxation. P. 20.

4. A tax is not necessarily and certainly arbitrary because retroactively applied, but may be justified and upheld in such application because of the particular circumstances. P. 21.

5. A gift in contemplation of death was made while the 1916 Revenue Act was in force; the donor died after the effective date of the Act of 1918; in assessing his estate for transfer tax, the value of the gift at the time of his death was included, and the tax on the whole was levied at the rates of the 1918 Act, which were higher than those of the Act of 1916. Held that the application of the later rates, as respects the gift, was not unreasonable or unconstitutional in view of the relations of such gifts to transfers by death and the legislative policy of both Acts concerning them, established before the gift was made. P. 20.

6. The application of the higher rate of the 1918 Act to gifts made in contemplation of death while the 1916 Act was in force does not destroy the character of the tax as one on privileges, and so render it unconstitutional as an unapportioned direct tax. P. 24.

69 Ct.Cls. 231, 38 F.2d 381, affirmed.

Certiorari, 282 U.S. 817, to review a judgment denying recovery of a tax.