Thomas v. Commissioner of Internal Revenue , 100 F.2d 408 ( 1938 )

L.0 HAND, Circuit Judge

, .. (concurring).

t , , T • i , , , I concur, but i wish to state some doubts, which seem to me substantial, as to the propriety of taxing a widow upon the income of a trust fund, accepted by her during her husband's life, in exchange for alimony. The husband is confessedly taxable upon that income while he lives, and the wife is not; we are holding that the reverse is true after his death. In prillciple I find it very hard to support this change, because the income during the later period seems to me equally with that during the earlier, part of a single consideration. The husband’s liability is only for their joint lives, which is always actuarially a shorter period than the life of either one. Ordinarily, therefore, the annuai income will be less than what she would have accepted, if she were confined to the period during which he is liable. If it were practicable to continue the tax upon his estate after his death, I should therefore think that that was the proper way — he has given a quid pro quo meas-tired by a less sum for a longer period, But I cannot see how this could be administered in practice. The income of the trust must be calculated as part of the husband’s income, which, being dead, he cannot have; and it would not be possible even by impounding some part of his estate to provide for it. True, one could in that way secure the normal tax, but that is not enough; the actual tax could not even be calculated. I know that it is not a very good reason for taxing one person that it is impossible to collect the tax out of another, but we are continually admonished that the taxation is a practical matter, and here I am disposed to accept that as an adequate excuse. The result may be somewhat unfair before the law becomes fixed, but thereafter women who accept such settlements will be apt to take into consideration the fact that if their husbands die first, the tax will shift to them,