Cite as: 520 U. S. 93 (1997)
Syllabus
(d) The Tax Court found that, on the facts presented, the trustee's discretion to pay administration expenses out of income was not a material limitation on the right to receive income. There is no reason to reverse for the Tax Court's failure to specify the facts it considered relevant to the materiality inquiry. The anticipated expenses could have been thought immaterial in light of the income the trust corpus could have been expected to generate. P. 107. (e) This approach to the valuation question is consistent with the language of 26 U. S. C. § 2056(b), as interpreted in United States v. Stapf, 375 U. S. 118, 126, in which the Court held that the marital deduction should not exceed the "net economic interest received by the surviving spouse." There is no basis here for the Commissioner's argument that the reduction she seeks is necessary to avoid a "double deduction" for administration expenses in violation of 26 U. S. C. § 642(g). Moreover, assuming that the marital deduction statute's legislative history would have relevance here, it does not support the Commissioner's position. Pp. 109-111.
Justice O'Connor, joined by Justice Souter and Justice Thomas, concluded that the relevant sources point to a test of quantitative materiality to determine whether allocation of administrative expenses to postmortem income reduces marital and charitable deductions, and that test is not met by the unusual factual record in this case. Pp. 111-122. (a) Neither the Tax Code itself nor its legislative history supplies guidance on the question whether allocation of administrative expenses to postmortem income reduces the marital deduction always, sometimes, or not at all. However, the Commissioner's regulations and revenue rulings can be relied on to decide this issue. Title 26 CFR § 20.2056(b)-4(a) directs the reader to ask whether the executor's right to allocate administrative expenses to the marital bequest's postmortem income is a "material limitation" upon the spouse's "right to income from the property," such that "account must be taken of its effect." Because the executor's power is undeniably a "limitation" on the spouse's right to income, the case hinges on whether that limitation is "material." In Revenue Ruling 93-48, the Commissioner ruled that § 20.2056(b)-4(a)'s marital deduction is not "ordinarily" reduced when an executor allocates interest payments on deferred federal estate taxes to the spousal bequest's postmortem income. Such interest and the administrative expenses at issue here are so similar that they should be treated the same under § 20.2056(b)-4(a). The Commissioner's treatment of interest in the Revenue Ruling also indicates that some, but not all, financial obligations will reduce the marital deduction. Thus, by virtue of the Rul-
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