Commissioner v. Duberstein Case Brief

Why is the case important?

Taxpayer Duberstein received a Cadillac from a long-time business acquaintance. At issue was whether the Cadillac was truly a gift or a payment in exchange for business information. Taxpayer Stanton received a large amount of money as a gratuity after he resigned his employment of 10 years with a church.

Facts of the case


Was the Cadillac a gift excludable from gross income?
Was the gratuity a gift excludable from gross income?


Justice Brennan issued the opinion for the Supreme Court of the United States in holding that in Duberstein it was not error to consider the Cadillac as income and not a gift.
In Stanton, the Supreme Court found that the facts are not sufficient to make a determination and vacated the judgment and remanded for further proceedings.


“The court reversed the judgment in respondent one’s case and vacated the judgment in respondent two’s case. The court refused to create a standard test because the conclusion of what constituted a “”gift”” under I.R.C. § 22(b)(3) required consideration of the factual circumstances surrounding the transfer, in particular the transferor’s intent. The district court’s determination that the transfer of the automobile was recompense for respondent one’s services was not clearly erroneous, based upon the evidence. The judgment in respondent two’s case was vacated because the district court’s conclusory and general findings were insufficient for the appellate court to reverse its determination that the transfer of money was a gift.”

  • Case Brief: 1960
  • Petitioner: Commissioner
  • Respondent: Duberstein.
  • Decided by: Warren Court

Citation: 363 US 278 (1960)
Argued: Mar 23, 1960
Decided: Jun 13, 1960