- 7 -
question presented by petitioner's motion is whether, at the time
of her death, decedent possessed a beneficial interest in the
property transferred by Dilworth, assuming for present purposes
that the transfers were voidable.
In Morgan v. Commissioner, 309 U.S. 78, 80 (1940), the
Supreme Court stated:
State law creates legal interests and rights. The
federal revenue acts designate what interests or
rights, so created, shall be taxed. * * *
Relying on these principles, petitioner contends that the value
of decedent's Chapote limited partnership interest is not
includable in the value of decedent's gross estate on the ground
that, under Texas law, a voidable transfer vests title in the
transferee until successfully avoided. In short, petitioner
contends that section 2033 is not applicable insofar as the
disputed transfers were effective to vest legal title in the
transferees.
Petitioner's focus on the transferees' legal title to the
disputed property is misplaced. To the contrary, the question
posed under section 2033 is whether the decedent, at the time of
her death, possessed a beneficial interest in the property. If
the transfers in question constituted voidable transfers, we are
satisfied that the decedent possessed a beneficial interest in
the property; i.e., the right to avoid the transfers and regain
legal title to the property, within the meaning of section 2033.
Page: Previous 1 2 3 4 5 6 7 8 9 10 Next
Last modified: May 25, 2011