OPINION.
Opper, Judge:
Both factually and legally this proceeding arises against a complicated background. Decedent did not create the original trust out of which the deficiency arises. It was imposed, presumably with her consent, by the probate court upon property left by her deceased husband. The husband’s former wife was life beneficiary to the extent of $9,000 a year. At that point, the present decedent owned everything else.1 Had she died without any further transfer, the value of her interest in the trust would obviously have been includible in decedent’s estate when she died. Sec. 811 (a), I. R. C. 1939; Security-First Nat. Bank of Los Angeles, Executor, 35 B. T. A. 815.
Between March 3, 1931, and June 7,1932, however, decedent took a further step. She transferred to another trust her entire beneficial interest in the trust which had already been established for the life of Emma, the former wife. It is this transfer which respondent seeks to include in decedent’s estate under section 811 (c).
Petitioner then owned — and retained after the transfer into trust— two income interests. She had an immediate right to all income over $9,000 a year and a reversionary estate for her life in all the income after Emma’s death. One interest was uncertain and the other postponed, but both were capable of valuation; and they have been valued. We take it that when the parties stipulate that, if any amount is to be included in decedent’s estate on account of the transfer it is $132,461.86, they are agreeing on what that value is.
The significance of the date when this transfer took place is that it occurred between the passage of the Joint Resolution,2 which supposedly repealed3 the effect of cases relying upon May v. Hemer, 281 U. S. 238, and the more extensively worded amendments passed the following year. By the terms of the Technical Changes Act,4 the transfer is taxable only if under the Joint Resolution, and without reference to the subsequent amendments, the transfer would have been taxable.
The conclusion that a reversionary life estate was not encompassed in the phrase “intended to take effect * * * at * * * death,” May v. Hein&r, supra, was struck down by the CTwrch case,5 which in turn was overruled in this respect by the Technical Changes Act. But the 1926 Act was not the only legislation applicable to this transfer. By the time the trust was set up there were also included under the Joint Resolution transfers with reservation for life or for any period not ending before death of the possession, enjoyment, or income of the property. At first blush, decedent would appear to have accomplished just that.
The language of the Joint Resolution included in a decedent’s estate transferred property as to which
the transferor has retained for his life or any period not ending before his death (1) the possession or enjoyment of, or the income from, the property * * *
By the 1982 amendments, this language was changed to read as follows, the additional words being underscored:
under which he has retained for his life or for any period, not ascertamdble vMhout reference to his death or for any period which does not in fact end before his death (1) the possession or enjoyment of, or the right to the income from, the property * * * [Rev. Act 1932, sec. 803.]
If the only retained income interest had been the reversionary life estate, it might be that the property would not be includible. Cases6 reaching a contrary result as to transfers after June 7, 1932, rely partly upon the language “for any period not ascertainable without reference to his death” which was added by the 1932 amendments' and explicitly termed a change of substance in the Committee Report. This, as petitioner points out, is not as astonishing as might first appear. There is no evidence that the Joint Resolution was directed against the case of May v. Heiner, supra, and its immediate occasion was the decision of three cases7 by the Supreme Court dealing not with reversionary but with immediate life estates. Cf. Bittker, “The Church and Spiegel Cases,” 58 Yale L. J. 825, 829, 869 (1949). In fact, in one of the opinions to which we have referred where the added language is relied upon, the court suggests:
As, however, Congress deemed the addition of this second phrase a substantial change, it may well be that it was intended to eradicate any part of the May v. Seiner interpretation which the Joint Resolution of 1931 * * * may conceivably have left intact. [Marks v. Higgins, (C. A. 2) 213 F. 2d 884.]
Unlike Estate of Herman Hohensee, Sr., 25 T. C. 1258, the retroactive provisions of the Technical Changes Act do not by express congressional language include this interest. And it is equally unnecessary to pass here upon the still unresolved question whether it was intended, in the Technical Changes Act, to make any real distinction between transfers taking place before and after June 7, 1932. See Estate of Myron Selznick, 15 T. C. 716, 726, affirmed per curiam (C. A. 9) 195 F. 2d 735.
However that may be, this decedent did not. retain only the rever-sionary life estate. As we have said, she retained all that she ever had as long as she lived. Only at her death did her interests terminate. These interests included the right each year during her life to receive the excess income over $9,000 a year. Since the corpus of the trust was $200,000, this interest could not have been without some value. "What that value was,8 how it is to be arrived at, and how it compares with the value of the reversionary life estate, we need not consider. The parties, as we have said, have agreed upon the valuation of all of decedent’s combined interests. Since, in addition to the reversionary life estate, decedent retained a valuable right to excess income for a period which did not end before her death, we think the stipulated value of the transfer is directly encompassed within the language of the Joint Resolution and is to be included in the gross estate.
Petitioner appears to labor under the impression that the amendment to section 811 (c) (2) made by section 7 of the Technical Changes Act9 is somehow effective to eliminate this situation from includible transfers. That provision required a reversionary interest to be worth at least 5 per cent of the transferred property for it to be subject to inclusion. Tó that rule the section makes an explicit exception where the reversionary interest is itself a life estate. It obviously was not intended to eliminate reversionary life estates in their entirety. And in any event there is no showing here that the interest retained by decedent did not amount to more than 5 per cent and the available arithmetic indicates the contrary.
The present result is directly contrary to that reached in Estate of Charles Curie, 4 T. C. 1175, where the same types of interests were retained by decedent. Inclusion on account of the right to excess income was denied because of a supposed ruling in T. D. 4868, 1988-2 C. B. 355, 356.
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OPINION.
Opper, Judge:
Both factually and legally this proceeding arises against a complicated background. Decedent did not create the original trust out of which the deficiency arises. It was imposed, presumably with her consent, by the probate court upon property left by her deceased husband. The husband’s former wife was life beneficiary to the extent of $9,000 a year. At that point, the present decedent owned everything else.1 Had she died without any further transfer, the value of her interest in the trust would obviously have been includible in decedent’s estate when she died. Sec. 811 (a), I. R. C. 1939; Security-First Nat. Bank of Los Angeles, Executor, 35 B. T. A. 815.
Between March 3, 1931, and June 7,1932, however, decedent took a further step. She transferred to another trust her entire beneficial interest in the trust which had already been established for the life of Emma, the former wife. It is this transfer which respondent seeks to include in decedent’s estate under section 811 (c).
Petitioner then owned — and retained after the transfer into trust— two income interests. She had an immediate right to all income over $9,000 a year and a reversionary estate for her life in all the income after Emma’s death. One interest was uncertain and the other postponed, but both were capable of valuation; and they have been valued. We take it that when the parties stipulate that, if any amount is to be included in decedent’s estate on account of the transfer it is $132,461.86, they are agreeing on what that value is.
The significance of the date when this transfer took place is that it occurred between the passage of the Joint Resolution,2 which supposedly repealed3 the effect of cases relying upon May v. Hemer, 281 U. S. 238, and the more extensively worded amendments passed the following year. By the terms of the Technical Changes Act,4 the transfer is taxable only if under the Joint Resolution, and without reference to the subsequent amendments, the transfer would have been taxable.
The conclusion that a reversionary life estate was not encompassed in the phrase “intended to take effect * * * at * * * death,” May v. Hein&r, supra, was struck down by the CTwrch case,5 which in turn was overruled in this respect by the Technical Changes Act. But the 1926 Act was not the only legislation applicable to this transfer. By the time the trust was set up there were also included under the Joint Resolution transfers with reservation for life or for any period not ending before death of the possession, enjoyment, or income of the property. At first blush, decedent would appear to have accomplished just that.
The language of the Joint Resolution included in a decedent’s estate transferred property as to which
the transferor has retained for his life or any period not ending before his death (1) the possession or enjoyment of, or the income from, the property * * *
By the 1982 amendments, this language was changed to read as follows, the additional words being underscored:
under which he has retained for his life or for any period, not ascertamdble vMhout reference to his death or for any period which does not in fact end before his death (1) the possession or enjoyment of, or the right to the income from, the property * * * [Rev. Act 1932, sec. 803.]
If the only retained income interest had been the reversionary life estate, it might be that the property would not be includible. Cases6 reaching a contrary result as to transfers after June 7, 1932, rely partly upon the language “for any period not ascertainable without reference to his death” which was added by the 1932 amendments' and explicitly termed a change of substance in the Committee Report. This, as petitioner points out, is not as astonishing as might first appear. There is no evidence that the Joint Resolution was directed against the case of May v. Heiner, supra, and its immediate occasion was the decision of three cases7 by the Supreme Court dealing not with reversionary but with immediate life estates. Cf. Bittker, “The Church and Spiegel Cases,” 58 Yale L. J. 825, 829, 869 (1949). In fact, in one of the opinions to which we have referred where the added language is relied upon, the court suggests:
As, however, Congress deemed the addition of this second phrase a substantial change, it may well be that it was intended to eradicate any part of the May v. Seiner interpretation which the Joint Resolution of 1931 * * * may conceivably have left intact. [Marks v. Higgins, (C. A. 2) 213 F. 2d 884.]
Unlike Estate of Herman Hohensee, Sr., 25 T. C. 1258, the retroactive provisions of the Technical Changes Act do not by express congressional language include this interest. And it is equally unnecessary to pass here upon the still unresolved question whether it was intended, in the Technical Changes Act, to make any real distinction between transfers taking place before and after June 7, 1932. See Estate of Myron Selznick, 15 T. C. 716, 726, affirmed per curiam (C. A. 9) 195 F. 2d 735.
However that may be, this decedent did not. retain only the rever-sionary life estate. As we have said, she retained all that she ever had as long as she lived. Only at her death did her interests terminate. These interests included the right each year during her life to receive the excess income over $9,000 a year. Since the corpus of the trust was $200,000, this interest could not have been without some value. "What that value was,8 how it is to be arrived at, and how it compares with the value of the reversionary life estate, we need not consider. The parties, as we have said, have agreed upon the valuation of all of decedent’s combined interests. Since, in addition to the reversionary life estate, decedent retained a valuable right to excess income for a period which did not end before her death, we think the stipulated value of the transfer is directly encompassed within the language of the Joint Resolution and is to be included in the gross estate.
Petitioner appears to labor under the impression that the amendment to section 811 (c) (2) made by section 7 of the Technical Changes Act9 is somehow effective to eliminate this situation from includible transfers. That provision required a reversionary interest to be worth at least 5 per cent of the transferred property for it to be subject to inclusion. Tó that rule the section makes an explicit exception where the reversionary interest is itself a life estate. It obviously was not intended to eliminate reversionary life estates in their entirety. And in any event there is no showing here that the interest retained by decedent did not amount to more than 5 per cent and the available arithmetic indicates the contrary.
The present result is directly contrary to that reached in Estate of Charles Curie, 4 T. C. 1175, where the same types of interests were retained by decedent. Inclusion on account of the right to excess income was denied because of a supposed ruling in T. D. 4868, 1988-2 C. B. 355, 356. We think the Curie case misconstrued the scope of that ruling10 which by its terms applies to parts only and not to excess amounts, the value of which, while perhaps uncertain, cannot nevertheless be entirely eliminated. To the extent that it is in conflict with the present conclusion, the Curie case will no longer be followed. On this issue the deficiency will be sustained.
The second issue involves a part of the executor’s commissions paid and allowed by the local probate court. Respondent concedes “that the executor’s fees paid * * * representing the application of the rate prescribed by Alabama law for executor’s fees to the receipts and disbursements of property owned by the decedent at death and included in the gross estate, are properly deductible. This amount is $21,915.51.” The balance of the executor’s fees, or $4,439.66, is disallowed because computed upon income received by the estate after decedent’s death and upon the distribution of that income.
In George W. Oldham et al, Executors, 36 B. T. A. 523, where the question involved was the deductibility of executor’s fees from income tax, we said at page 533:
the services rendered * * * were the usual and ordinary duties performed by executors in preparing an estate for distribution. * * *
at page 529:
Ordinarily the fees- and commissions of executors * * * and other representatives of estates are regarded as administration expenses and are applied against the gross estate in determining the estate tax. * * *
and at page 530:
If the process of administration goes forward in normal course, and distribution and settlement are completed within a usual and reasonable time, the expenses of the representatives of the estate are regarded as administration expenses. * * *
In the present case the amount of the executor’s commissions was established by the probate court. The computation of the commissions was made in accordance with Alabama statutes. Ala. Code 1940, tit. 61, secs. 377 and 378. It is clear in this case that the estate or the executor for the estate was not engaged in a trade or business, and that the activities of the executor were directed toward the distribution of estate assets. The administration of the estate has continued for an extended length of time, but considering the litigation, the problems involved, and the sums to be distributed, the length of time is not excessive. On this second issue petitioner is sustained.
Reviewed by the Court.
Decision will be entered u/nder Buie 50.