O. D. McKee and Estate of Anna Ruth McKee, Deceased, R. Ellsworth McKee and Jack C. McKee, Co-Executors - Page 17

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                    In Coffee v. Ruffin, 44 Tenn. 487 (1867), the                     
               executor was granted broad powers under the will.                      
               During the administration of the will, the executor                    
               borrowed money at usurious rates of interest to prevent                
               a sacrificial sale of the real estate.  The court                      
               credited the executor for the usurious interest paid,                  
               noting the broad discretion conferred upon the executor                
               by the will to borrow money, even at usurious rates,                   
               and to charge the estate with that interest.  In Allen                 
               v. Shanks, 90 Tenn. 359, 16 S.W. 715 (1891), the                       
               executor borrowed money without express authorization.                 
               Because the money was used to benefit the estate,                      
               however, the court credited the executor for legal                     
               interest paid on the loan, but it refused to credit the                
               usurious percentage of the interest.                                   
                    As the Coffee and Ruffin [sic Allen] courts                       
               credited interest as a cost of administration under                    
               those circumstances, likewise, interest should be a                    
               proper expense of administration when specifically                     
               authorized by the terms of the will, as in the present                 
               case.  Interest is simply the cost of using money, and                 
               there should be no differentiation for purposes of                     
               deductibility whether the interest is paid on taxes or                 
               on money borrowed to pay the taxes.  Estate of Bahr v.                 
               Commissioner, 68 T.C. 74 (1974); * * * [Id. at 202;                    
               emphasis added.]                                                       
               Under Tennessee law, the incorporation in a will of the                
          statutory power set forth in Tenn. Code Ann. sec. 35-50-110(8)              
          authorizes an executor to borrow funds and provides that a                  
          Tennessee court will credit an executor for interest necessarily            
          and properly incurred on loans.  Decedent incorporated by                   
          reference the provisions contained in Tenn. Code Ann. sec. 35-50-           
          110 into her will.                                                          
               Respondent would distinguish Cleveland Bank and Trust Co. v.           
          Olsen, supra, on the grounds that in that case the incorporation            
          of the statutory power to borrow was not restricted by limiting             
          language in the will.  In the instant case, the incorporation of            





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