Case Name: Appeal of THE SPRINGDALE CEMETERY ASSOCIATION
Court: United States Board of Tax Appeals
Jurisdiction: United States
Decision Date: 1925-12-21
Citations: 3 B.T.A. 223
Docket Number: Docket No. 4169
Parties: Appeal of THE SPRINGDALE CEMETERY ASSOCIATION.
Judges: Before Sterni-iagen, LáNSdoN, and AeuNdell.
Reporter: Reports of the United States Board of Tax Appeals
Volume: 3
Pages: 223–226

Head Matter:
Appeal of THE SPRINGDALE CEMETERY ASSOCIATION.
Docket No. 4169.
Submitted October 31, 1925.
Decided December 21, 1925.
J. E. Houston, Esq., for the taxpayer.
A. H. Fast, Esq., for the Commissioner.
Before Sterni-iagen, LáNSdoN, and AeuNdell.

Opinion:
OPINION.
SteRnhagen:
The situation here is different from that considered in the Appeal of The Los Angeles Cemetery Association, 2 B. T. A. 495, for there the fund for perpetual care was mandatory .and was clearly a trust fund. Here it is permissive under the State law. Bourland v. Springdale Cemetery Association, 158 Ill. 458; 42 N. E. 86. The taxpayer voluntarily set up a reserve based on an estimate, but there is lacking the clear evidence necessary to establish a trust. So far as the record shows, the directors might at any time reduce the fund or perhaps wipe it out, without restraint, their liability, if any, being one for breach of covenant or contract. Hence we hold that the whole amount received on the sale of lands in the taxable years was gross income to the extent of the excess over March 1, 1913, value or original cost, whichever was higher.
Since the 25 cents per square foot which was reserved for perpetual care was part of the sale price in the taxable years, it was no less so as to sales made around 1913 which were used as measures of value of the remaining lands. It was therefore improper to reduce 1913 value by 25 cents a square foot, and we hold that the figures shown in the column headed " Cost sq. ft." should be used to determine March 1, 1913, value.