In the United States v. Wells et al., Executor, 1930 case, the Supreme Court was tasked with determining whether a federal estate tax applied to an inheritance that had been left in trust for a widow and her children. The decedent's will stipulated that his wife would receive income from the trust during her lifetime and upon her death, their children would inherit what remained of it. The government argued that this arrangement constituted a "transfer" under Section 402(c) of the Revenue Act of 1918 and was therefore subject to taxation. However, both lower courts disagreed with this interpretation. The Supreme Court sided with these rulings by affirming them unanimously without opinion (per curiam). It held that no taxable transfer occurred because there were no restrictions on how or when the beneficiaries could use their inheritance; they simply chose not to do so until after their mother's death out of respect for her wishes as stated in their father’s will. This decision clarified an important aspect of estate tax law: unless explicitly specified otherwise by statute or regulation, trusts are generally not considered transfers for tax purposes if they merely delay but don't limit beneficiaries' access to inherited assets.

In the dissenting opinion for United States v. Wells et al., Executor, Justice Stone argued that the majority's interpretation of the Revenue Act was incorrect and overly narrow. He contended that Congress intended to tax all income from any source derived, including interest on state bonds held by a decedent at his death. The majority's view would exclude such income from taxation unless specifically mentioned in the statute, which he believed contradicted Congressional intent and previous court rulings interpreting similar language in other revenue acts. Furthermore, he pointed out inconsistencies within their own reasoning - if they were correct about Congress not intending to tax this type of income without explicit mention then it should also be exempt from estate taxes under another section of the same act where it is similarly unmentioned; yet they had previously ruled otherwise in a separate case.