- 8 -
In deciding whether the payments were alimony, we examine
the language of the February 4, 1992, separation instrument to
ascertain whether it contains a termination upon death condition,
and, if it does not, whether State law supplies such a condition.
Hoover v. Commissioner, 102 F.3d 842, 847 (6th Cir. 1996), affg.
T.C. Memo. 1995-183; see Gonzales v. Commissioner, supra; see
also Cunningham v. Commissioner, T.C. Memo. 1994-474.
State law determines certain rights of the parties, and
Federal law determines the Federal income tax consequences of
those rights. Morgan v. Commissioner, 309 U.S. 78, 80 (1940);
Lucas v. Earl, 281 U.S. 111 (1930). The February 4, 1992,
separation instrument does not explicitly order that payments
terminate upon Ms. Gilbert’s death, and, thus, we examine
Pennsylvania law to determine whether the payments would
terminate by operation of Pennsylvania law. Hoover v.
Commissioner, supra at 847.
When examining a matter of State substantive law, we will
look to a State’s highest court to determine the rights of
parties under State law. See Estate of Bosch v. Commissioner,
387 U.S. 456, 465 (1967). The Pennsylvania Supreme Court has not
decided the narrow legal issue of whether an unallocated support
9(...continued)
in deciding that the unallocated payments were alimony.
Therefore, those cases provide only limited guidance on the issue
before us.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Next
Last modified: May 25, 2011