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BREWSTER V. GAGE, 280 U. S. 327 (1930)

U.S. Supreme Court

Brewster v. Gage, 280 U.S. 327 (1930)

Brewster v. Gage

No. 61

Argued December 6, 1929

Decided January 6, 1930

280 U.S. 327


1. Under the Revenue Acts of 1918 and 1921, which provide, §§ 202(a), that, for the purpose of ascertaining the gain derived or loss sustained from the sale of property "acquired" on or after March

Page 280 U. S. 328

1, 1913, the basis shall be its cost, the latter Act declaring also that, in case of

"property acquired by bequest, devise, or inheritance, the basis shall be the fair market price or value of such property at the time of such acquisition,"

the basis of calculation in the case of stocks acquired by the taxpayer as a residuary legatee and sold by him is not their value at the date of the decree of distribution, but their value at the date of the testator's death. P. 280 U. S. 333.

2. The right of a residuary legatee to have his share of the residue after administration vests immediately upon the testator's death. The decree of distribution confers no new right; it merely identifies the property remaining, evidences the right of possession in the legatee, and requires its delivery by the executor or administrator. The legal title so given relates back to the date of the death. P. 280 U. S. 334.

3. The practical interpretation of an ambiguous or doubtful statute that has been acted upon by officials charged with its administration will not be disturbed except for weighty reasons. P. 280 U. S. 336.

4. Substantial reenactment in later Acts of a provision theretofore construed in regulations of the department charged with its administration is persuasive evidence of legislative approval of the regulations. P. 280 U. S. 337.

5. In § 113(a)(5) of the Revenue Act of 1928, which defines the basis of calculating gain or loss in respect of sales of property acquired by devise, bequest or intestacy, the language, deliberately selected, so differs from that used in the earlier Acts as to indicate an intention to change the law. There is no support for the suggestion that it expressed the meaning, or was intended to govern or affect the construction of the earlier Acts. P. 280 U. S. 337.

30 F.2d 604 affirmed.

Certiorari, 279 U.S. 831, to review a judgment of the circuit court of appeals which reversed a judgment, 25 F.2d 915, for Brewster in an action to recover from the Collector amounts exacted as additional income taxes.

Page 280 U. S. 332

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