Case ID: bta_3/html/1138-01.html
Source: Caselaw Access Project
Author: {"author": "", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Appeal of HENRY S. KLINE.
    Docket No. 5284.
    Submitted January 12, 1926.
    Decided April 1, 1926.
    
      Henry B. Kline, Esq., pro se.
    
      Ellis W. Manning, Esq., for the Commissioner.
    Before Smith, James, Littleton, and Trussell.
    This is an appeal from the determination of a deficiency in incomí tax for the year 1922 in the amount of $376.13, of which $75.66 is ir controversy. The question in issue is whether the total amount oi premiums paid on a life insurance policy fully paid up prior tc March 1, 1913, or the surrender value of the policy on that date is the basis for computing income derived from the net proceeds oi the policy received at its maturity in 1922.
   FINDINGS OF FACT.

The taxpayer was the insured under policy No. 3377217, issuec 'by the New York Life Insurance Co. on November 29, 1902. The face value of the policy was $10,000. Under its terms 10 annua' premiums of $965.20 each were paid. The policy was fully paic up prior to March 1, 1913. No dividends or other distributions were made upon the policy prior to November 11, 1922, on whicl date the taxpayer received in settlement of the policy $14,830.10 The cash surrender value of the policy on March 1, 1913, was $9,070 The total amount of premiums paid on the policy amounted tc $9,652. The Commissioner based his computation of profit upor a value on March 1, 1913, of $9,070, the cash surrender value.

The deficiency for the year 1922 is $376.13. Order of redetermination will be entered accordingly.