Court Opinion

ID: 8807928
Source: CourtListenerOpinion
Date Created: 2022-11-26 14:53:44.294644+00
Date Added: 2024-06-11T17:04:10.433064
License: Public Domain

On Petition for Rehearing.
PER CURIAM.
The petitioners assert that our opinion herein, dated. May 3, 1918, adopts a “theory of construction” of the Income Tax Act of 1913 “which * * * means that millions of dollars have been assessed as income taxes and collected unlawfully,” while “immense amounts of income would have entirely escaped taxation” under it.
The theory said to have been adopted is:
“That only two classes of income are taxable, viz.: (a) Individual incomes to which ascertained individuals are absolutely and unconditionally entitled; and (b) the incomes of some forms of organization or associations, corporate or not.”
Various supposed kinds of trusts are suggested, the incomes whereof, according to' the petitioners, would be excluded under the act from taxability, by the above theory. We might, in many of these instances, agree with the petitioners that in the supposed case no “association” theory could be adopted; but this would depend upon all the facts as shown in each case.
We pointed out in our opinion what seemed to us the broad distinction made in the act; i. e., between incomes arising or accruing to individuals, and incomes arising or accruing to groups or bodies of individuals. We have also said, with regard to the income shown to have been received by the petitioners under the circumstances of this case, that, not being claimed to have arisen or accrued to them as individuals, unless it.was either taxable under section II G, a, of the act, or was taxable as income arising or accruing to the individual beneficiaries of their trust, it would be “income upon which no tax was imposed by any express and distinct provisions of the statute.” We are unable to believe that this necessarily means an adoption of the theory asserted in the petition.
It may be assumed to be contrary to the general intent of the act that any income not expressly exempted hy it should escape taxation. Nothing in our opinion necessarily requires the conclusion that no .given income could, under any circumstances, be held taxable under the act, unless brought directly within some express and distinct provision therein found. Further than to hold the income here in question not to have arisen or accrued to the beneficiaries of the petitioners’ trust as individuals, we have not undertaken to determine or limit the meaning capable of being given to the term “individuals.”
The greater part of what is urged in the petition relates to various Treasury regulations and rulings by the Treasury Department, made and enforced under the authority of the act, and therefore claimed to manifest its intent. To none of these was any reference made in the petitioners’ brief submitted at the argument. We find nothing *826in them necessarily at variance with what has been determined by our decision.
No judge concurring in the judgment entered desiring a rehearing, the petition must be denied.