
    KATHRYN HEDRICK WALLACE v. THE UNITED STATES
    [No. 49326.
    Decided March 2, 1954]
    
      
      Mr. Frank A. Graham, Jr., for plaintiff.
    
      Mrs. Elizabeth B. Davis, with, whom was Mr. Assistant Attorney General H. Brian Holland, for defendant. Mr. Andrew D. Sharpe was on the brief.
   Madden, Judge,

delivered the opinion of the court:

The plaintiff is the widow and sole beneficiary of the estate of Captain Charles A. Wallace who died on August 27,1944, as a result of wounds received by him while serving in the Army of the United States. The plaintiff sues to recover all the income taxes paid by her husband for the taxable year 1941 and a small amount representing a deficiency and interest on 1940 taxes, which he paid in January 1943. His 1941 taxes were paid in quarterly installments in 1942, as the law at that time required. A1941 deficiency, and interest on it, were also paid in January 1943.

Captain Wallace entered the military service on November 9, 1942. The taxes in question, being for the taxable years 1940 and 1941, were thus for taxable years preceding the year of his entry into military service. All of the taxes here in question were paid before he entered military service, except the December 1942 installment of the 1941 taxes, and the deficiencies and interest on both 1940 and 1941 taxes which he paid in January 1943. All of the taxes were paid at least 18 months before Captain Wallace’s death on August 27, 1944.

The plaintiff relies upon the provisions of 26 U. S. C. 1946 ed., Supp. II, Sec. 421 as amended by Pubic Law 367, approved August 5,1947. The statute is Section 421 of the Internal Revenue Code. It provides:

ABATEMENT OE TAX EOR MEMBERS OE ARMED EORCES UPON DEATH
In the case of any individual who dies on or after December 7, 1941, while in active service as a member of the military or naval forces of the United States or of any of the other United Nations and prior to January 1, 1948—
(a) the tax imposed by this chapter shall not apply with respect to the taxable year in which falls the date of his death, or with respect to any prior taxable year (ending on or after December 7,1941) during any part of which he was a member of such forces; and
(b) the tax under this chapter and under the corresponding title of each prior revenue law for taxable years preceding those specified in clause (a) which is unpaid at the date of his death (including interest, additions to the tax, and additional amounts) shall not be assessed, and if assessed the assessment shall be abated, and if collected shall be credited or refunded as an overpayment.

Paragraph (a) says that Captain Wallace was not subject to income taxes for the year of his death, 1944, nor for the prior years 1943 and 1942, he having entered the military service on November 9, 1942. If, therefore, he had paid taxes for those years, those taxes would be refundable. But the taxes here sued for were for the taxable years 1940 and 1941, hence paragraph (a) has no application.

The plaintiff urges as we understand it, that, since the 1941 taxes were not due and payable until March, June, September, and December of 1942, that these taxes were for the taxable year 1942, the year in which Captain Wallace entered the military service, and were therefore forgiven and made refundable by paragraph (a) of Section 421. We tbinb-the words “taxable year” are so familiar to the Members of Congress who write tax legislation that they could not possibly have used them with the meaning for which the plaintiff contends.

Paragraph (b) says that any income taxes of a soldier for any year, which tax is unpaid at the date of his death, shall not be assessed or collected and if collected shall be refunded. The taxes here in question were not unpaid at the date of the soldier’s death. They had been paid, the last of them eighteen months before his death. This paragraph also, then, does not apply to the situation which is before us. The language at the end of the paragraph about crediting or refunding taxes unpaid at the date of death must have to do with cases where information as to the death of the soldier was delayed, or where, in ignorance of the law, the taxes were paid after his death.

We could not hold that the plaintiff was entitled to recover under paragraph (b) of Section 421 without concluding that all the income taxes ever paid for any year by a soldier who died in military service were refundable.

The plaintiff’s petition will be dismissed.

It is so ordered.

Whitaker, Judge; Littleton, Judge; and Jones, Chief Judge, concur.

FINDINGS OF FACT

The court, having considered the evidence, the report of Commissioner Kichard H. Akers, and the briefs and argument of counsel, makes findings of fact as follows:

1. The plaintiff is the widow and sole beneficiary of the Estate of Charles A. Wallace, who died on August 27,1944.

2. Charles A. Wallace, a citizen of the United States and a resident of Columbia, South Carolina, was commissioned a Captain in the Army of the United States of America on November 9,1942, and died on August 27,1944, on the Island of Saipan as a result of wounds received in action while in the discharge of his duty as a member of the United States Army. He was a member of the United States Army from the date he was commissioned until the date of his death. He was ordered to serve in the Pacific Theater of Operations on February 11,1944, where he served until the date of his death.

3. Charles A. Wallace, while a member of the United States Army, was assigned to temporary duty in Havana, Cuba, and such other points in Cuba as might be necessary by orders dated May 12, June 5, and July 15,1943. He was assigned on temporary duty to Ciudad Trujillo, Dominican Eepublic, and thence to such point or points in Dominican Eepublic, Venezuela, and Cuba as might be necessary by orders dated June 23, 1943. He was assigned to temporary duty to La Guaira, Venezuela, and other points in the Canal Zone, South America, and Central America by orders dated July 1,1943. The orders of May 12,1943, referred to above, read as follows:

1. By authority: Letter of C of E file CE 210.3 (Engrs., Corps of) SPEAM, Subject: Authority to assign and reassign individual officers of the Army of the United States, dated March 31,1943,-you are directed to proceed from your temporary station at Miami, Florida, on temporary duty in connection with the construction program, to Havana, Cuba, and thence to such point or points in Cuba as may be necessary, making as many trips to and between these points as may be necessary, and upon completion of this temporary duty, return to your temporary station at Miami, Florida.
2. Travel outside the continental limits of the United States via the most available means of transportation, including military and/or commercial aircraft (Sec. IV Cir. 12 WD 1942), belligerent vessel and/or aircraft is-directed.
3. A per diem of $6.00 in lieu of subsistence and exclusive of transportation charges will be allowed for the time required to perform this temporary duty.
4. This travel is necessary in the military service, and all expenses incident thereto are chargeable to Procurement Authority ENG 32301 P430-02 A 0905-23.

The other orders, except for the places to which he was assigned, read in a similar manner.

4. The Federal income tax return of Charles A. Wallace for the calendar year 1941 was filed on March 16, 1942, showing a tax liability of $16,965.36 which was paid in four equal installments of $4,241.34 on March 26, June 17, September 16, and December 15,1942.

5. Deficiencies in the income taxes of Charles A. Wallace for the calendar years 1940 and 1941 were determined by the Commissioner of Internal Revenue in the amount of $428 for 1940 and $1,107.77 for 1941. These amounts, together with interest of $48.06 for 1940 and $57.94 for 1941, making a total of $1,641.77, were paid on January 30, 1943.

6. On September 27, 1948, the plaintiff filed a claim for refund of taxes paid for the calendar years 1940 and 1941 in the total amount of $18,607.13. That represented the deficiency and interest paid for 1940 in the amount of $476.06, and the total taxes paid for 1941 in the amount of $18,131.07. The claim was based upon the ground that under the provisions of Section 421 of the Internal Revenue Code, as amended by Public Law 867, approved August 5, 1947, the taxes referred to therein should be refunded. The claim was rejected in full by the Commissioner on February 7,1949.

CONCLUSION OF LAW

Upon the foregoing findings of fact, which are made a part of the judgment herein, the court concludes that as a matter of law the plaintiff is not entitled to recover, and the petition is therefore dismissed.  