James Earl Lawson
Would the amendment mean this: Suppose a settlor has set up a trust. Under that trust someone other than himself gets the benefit, the income from it. The settlor has divested himself of control over the capital of the trust. Let me assume that the trustees, for the benefit of the cestui que trust under the trust agreement, decide to place insurance upon the life of the settlor, the benefit to go to the beneficiaries under the trust. They use the income from the trust for that purpose. Somebody pays taxes on that income as it stands to-day, either the cestui que trust or the settlor. Would this section make those premiums taxable again as against the settlor?
Income War Tax Act