James Clark McReynolds

“ Anderson, 276 U.S. 440, 48 S.C.t. 353, 72 L. Ed. 645, considered the validity of an enactment which laid a tax upon donors because of gifts fully consummated prior to its passage. We held this was beyond the power of Congress. None of these cases is in point; they gave no consideration to the power of Congress to require that taxable income should include profits from transactions consummated within the year. ”

“ We think the purpose of Congress to apply the provisions of section 202 (a) (2) to the transaction here involved is clear. Shwab v. Doyle grew out of the Revenue Act of September 8, 1916 (39 Stat. 758) . There, after considering the relevant circumstances, we declared there was no intention to give retroactive effect to the enactment. Here, the contrary design is not doubtful.
The power of Congress to tax as part of a donee's income the difference between what the gift cost the donor and the price received therefor when sold by the donee was affirmed in Taft v. ”

“ That the questioned provision cannot be declared in conflict with the Federal Constitution merely because it requires gains from prior but recent transactions to be treated as part of the taxpayer's gross income has not been open to serious doubt since Brushaber v. ”