Comm'r of Internal Revenue

This case is not covered by Casetext's citator
Tax Court of the United States.Jan 27, 1953
19 T.C. 752 (U.S.T.C. 1953)

Docket No. 30346.



Harry G. Taylor, Esq., and William J. McLeod, Jr., Esq., for the petitioner. James R. Harper, Jr., Esq., for the respondent.

Harry G. Taylor, Esq., and William J. McLeod, Jr., Esq., for the petitioner. James R. Harper, Jr., Esq., for the respondent.

An income tax return for 1947 in joint form, unsigned by the wife, where she had no income in the taxable year and took no part in the preparation of the return, held, not to be a joint return. Held, further, an income tax return in joint form for 1948 signed by both the husband and wife was in fact a joint return.

This proceeding involves a redetermination of deficiencies in income tax as follows:

+---------------+ ¦1946¦$1,795.41 ¦ +----+----------¦ ¦1947¦2,177.61 ¦ +----+----------¦ ¦1948¦4,891.30 ¦ +---------------+

Petitioner has conceded the issues with respect to the deficiency for 1946.

The sole question for decision is whether the income tax returns for 1947 and 1948 are joint returns.


Petitioner is an individual residing in Palm Beach, Florida. She was married to Dr. W. B. Wilkins (hereafter called the doctor), a physician practicing in Palm Beach and West Palm Beach, Florida, in July 1941.

The doctor entered the military service in 1942. In April 1946 he was discharged and resumed his practice. The couple lived together in Palm Beach from April 1946 until May 1949. In June 1949 they were divorced.

Facts With Reference to the 1947 Return.

Petitioner was a housewife during 1947. She assisted her husband, the doctor, with his bookkeeping and with his banking transactions. She made summaries of his monthly receipts at his request. Because the doctor thought it might result in some tax advantage he arranged to pay petitioner $2,500 a year for these services. This amount was to be deposited in a joint checking account until the doctor ‘got on (his) feet.‘ Part of the money was placed in petitioner's separate savings account. Some of it was used for ordinary family expenses and to make payments on the mortgage on their home. The deposits were made in both the checking and the savings accounts at the doctor's direction for the purpose of making a record to support a possible income tax deduction. The arrangement was not a bona fide salary arrangement. Petitioner was not an employee of the doctor and the deposits she made were not her income. At the beginning of 1948 the doctor's auditor told him that the arrangement would not give him any tax advantage and it was discontinued.

Petitioner had no income during 1947 and did not file a separate return.

An income tax return for 1947 was filed headed ‘W. B. Wilkins and (wife) Virginia.‘ In the bracketed space entitled ‘Your Exemptions‘ the following appears:

+-----------------------------+ ¦Your name W. B. Wilkins ¦ ¦ +------------------------+----¦ ¦Virginia Wilkins ¦wife¦ +------------------------+----¦ ¦T. R. Wilkins ¦son.¦ +-----------------------------+

On page one of the return, the question ‘Is your wife (or husband) making a separate return for 1947?‘ was answered ‘No.‘

At the foot of the return the signature of Byron S. (?) Curry, Shepard and Curry, Certified Public Accountants, appears in the blank provided for the ‘(Signature of person (other than taxpayer or agent) preparing return).‘ The signature of W. B. Wilkins, M.D., appears in the blank provided for ‘(Signature of taxpayer).‘ No signature appears in the blank under which is printed ‘(If this is a joint return of husband and wife, it must be signed by both).‘

The only income reported on the 1947 return is income earned by the doctor from his practice. The only deductions claimed are those relating to the doctor's practice and charitable contributions.

Petitioner was not consulted about the preparation of the return and had nothing to do with it. She did not see the return until shortly before the hearing on this proceeding.

The 1947 return was not a joint return and was not petitioner's return.

Facts With Reference to the 1948 Return.

In May 1948 a home was purchased in Palm Beach and title taken in the name of petitioner and the doctor. They rented the house to others for $6,500 for the season November 1948 through May 1949. During 1948, $3,150 in rent was received.

An income tax return for 1948 was filed in September 1949, headed ‘W. B. and Virginia Wilkins.‘ On page one, the question ‘Is your wife (or husband) making a separate return for 1948?‘ was answered ‘No.‘ This return was prepared by the accountant Byron Curry and his signature appears in the proper blank thereon. The foot of the return bears the signature ‘W. B. Wilkins M.D.‘ and ‘Virginia Wilkins‘ in the proper blanks. Petitioner in fact signed the return at an undisclosed date.

The doctor's income from his profession is reported on the return. There is also reported the rent received from the house jointly held by petitioner and the doctor and depreciation and expense deductions are claimed therefor.

The 1948 return was a joint return of W. B. Wilkins, M.D., and the petitioner. The petitioner filed no separate return for 1948.

In the latter part of 1949 the doctor called a friend who was a deputy collector and told him that he had reason to believe the petitioner had mishandled the doctor's financial affairs. The doctor was advised that his returns for the years in question would be called out and examined. As a result of the examination the doctor's income from his profession was recomputed on a net worth basis and deficiencies were determined. A statutory notice of deficiency was issued on June 9, 1950, addressed jointly to ‘Dr. and Mrs. W. B. Wilkins.‘ The doctor did not appeal, but petitioner did.



Respondent bases his argument that the 1947 return was a joint return on the following contentions: first, it was intended to be a joint return, despite absence of petitioner's signature; and, second, the return reported income and deductions attributable to petitioner and accordingly should be deemed a joint return.

In cases of this kind the respondent's determination is presumptively correct and the mere fact petitioner did not sign the return is not alone determinative, W. L. Kann, 18 T.C. 1032. In the Kann case the wife did not testify or produce any evidence tending to overcome the presumptive correctness of respondent's determination and the Court held that she had not sustained her burden of proof that the returns were not joint. Such is not the situation here. Petitioner testified she had nothing to do with the preparation of the 1947 return and had never seen it until shortly before the hearing. We have found as a fact that she had no income during 1947 despite respondent's contention that she received a ‘salary‘ from her husband, the doctor. We think the so-called ‘salary‘ agreement was not a real agreement. No deduction was claimed with respect to the ‘salary‘ on the return and the only income reported thereon was the professional income of the doctor. This case therefore, comes closer to Eva M. Manton, 11 T.C. 831, than to Myrna S. Howell, 10 T.C. 859, affd. 175 F.2d 240, and Walter M. Ferguson, Jr., 14 T.C. 846. See also the recent decision of McCord v. Granger (C.A. 3), 201 F.2d 103, where the Court of Appeals for the Third Circuit held that a return not signed by the wife was not a joint return although it included income from the sale of jointly held property. There are factual differences between this and the McCord case, which might serve to distinguish them; for instance, the wife there later filed a separate return and the husband an amended return. But the case before us is stronger for petitioner and we hold the 1947 return was not a joint return.

With respect to the 1948 return the facts are different. That return bears the admitted signature of petitioner. Thus her burden of overcoming the presumptive correctness of respondent's determination is substantially increased. She attempts to meet this burden by her testimony that she signed some document, which she took to be a request for additional time for filing, at Easter time 1949, when she was under great mental strain incident to getting the doctor placed in an institution for narcotic addiction. We are unable to determine whether or not she actually signed the return at that time or whether the document she then signed was in fact a request for an extension. The fact is that she signed a return for 1948 which appears regular in all respects and which in form is a joint return. The record does not convince us that her signature was affixed unconsciously and without intent to sign an income tax return and we have found as a fact that the 1948 return was a joint return. We are accordingly not called on to decide what might have been the case had we found she never really intended to sign a joint income tax return.

Decision will be entered under Rule 50.