TAXATION -TAXABILITY OF INSURANCE POLICIES UNDER THE FEDERAL ESTATE TAX WHERE POSSIBILITY OF REVERTER TO INSURED

In 1920 decedent purchased a fifty-thousand-dollar life insurance policy, making his wife beneficiary and providing that if she predeceased him the proceeds should be payable to the executors of his estate. No power to revoke the policy or to change the beneficiary was expressly retained. The decedent predeceased the beneficiary and, in the assessment of the federal estate tax, the proceeds were included as part of his gross estate. The tax was paid, and plaintiff executor brought suit to recover an alleged overpayment of the estate tax because of the inclusion in the gross estate of the proceeds of the policy. The district court held that the commissioner erred in including the policy in the gross estate, since the decedent after an irrevocable assignment had no interest in it. Held, that the possibility of reverter of the proceeds to decedent\u27s estate was a sufficient interest to require their inclusion therein. Chase National Bank of New York v. United States, (C. C. A. 2d, 1940) 116 F. (2d) 625