Salvatore v. Commissioner is an opinion from the United States Tax Court that holds that a taxpayer cannot avoid paying taxes on the sale of property by first conveying that property to someone else. This opinion was later affirmed by the United States Court of Appeals for the Second Circuit. This case outlines some limitations on the "fruit-and-tree" metaphor established in Lucas v. Earl, 281 U.S. 111 (1930) and further developed in Helvering v. Horst, 311 U.S. 112 (1940). Decided in 1970, the case arose when a taxpayer tried to avoid paying capital gains tax from sale of property by giving a share in that property to her children. She then paid a gift tax, which is significantly less than the tax on the gain would have been if she had not given a share to her children. Background Prior to his death on October 7, 1948, Susie Salvatore's husband owned and operated a gas station in Greenwich, Connecticut. Upon his death, his entire estate was bequeathed to his wife. For the next several years, Susie Salvatore, her three sons, and one of her two daughters operated the gas station. As time passed, several of the Salvatore children moved on while the land on which the gas station was located became increasingly valuable, to the point where several oil companies made offers to purchase the property. The family rejected several proposals, until in the summer of 1963, Texaco, Inc. made a proposal to purchase the land for $295,000. To ensure Susie Salvatore's accustomed weekly stipend (received from the operation of the gas station), she was to receive $100,000 of the proceeds. The remainder was to be divided amongst her children. To effectuate this, petitioner conveyed a one-half interest in the property to the children and the deeds would be executed by the children and petitioner when conveying the property to Texaco. On July 24, 1963, the Salvatore family formally accepted the offer from Texaco. Not until August 28, 1963, however, was a warranty deed conveying an undivided one-half interest in the property to her five children executed. On that same date, warranty deeds were executed conveying the property to Texaco, at which point Texaco paid the balance of the purchase price (less the $50,000 mortgage). In 1963, Susie Salvatore then filed a Federal gift tax return reporting gifts of 1/10 interest in the property to each of the five children.