United States v. Chandler
410 U.S. 257 (1973)

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U.S. Supreme Court

United States v. Chandler, 410 U.S. 257 (1973)

United States v. Chandler

No. 72-438

Decided January 22, 1973

410 U.S. 257




United States Savings Bonds are includable for federal estate tax purposes in the gross estate of a decedent registered co-owner who, with donative intent, had delivered the bonds to the other co-owners but who had not complied with applicable Treasury Department regulations for making inter vivos transfers of such bonds by having them reissued in the names of the other co-owners alone.

Certiorari granted; 460 F.2d 1281, reversed.


This case presents a narrow federal estate tax issue: does a registered co-owner of a United States Savings Bond, Series E, by physical inter vivos delivery of the bond to the other registered co-owner, with intent to effectuate a gift, but without reissuance of the bond, succeed in divesting himself of the incidents of ownership so that, at his subsequent death, the value of the bond is not includable in his gross estate under the joint interests provisions of § 2040 of the Internal Revenue Code of 1954, 26 U.S.C. § 2040?

The United States District Court for the Northern District of California ruled that the co-owner had accomplished this divestiture, and it rendered judgment in favor of the taxpayer estate. 312 F.Supp. 1263 (1970). The United States Court of Appeals for the Ninth Circuit affirmed for the reasons set out in the District Court's opinion. 460 F.2d 1281 (1972). The Sixth Circuit theretofore had held to the contrary on a fact situation similar to that of the present case. Estate of Curry v. United States, 409 F.2d 671 (1969). There

Page 410 U. S. 258

are other decisions to like effect. Estate of Elliott v. Commissioner, 57 T.C. 152 (1971), reviewed by the court and now pending on appeal to the Fifth Circuit; Chambliss v. United States, 71 U.S.T.C.

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