led them to conclude that "the wife and brother as trustees had no authority under the Illinois law to revest the property in the grantor," a requirement for liability under § 166. This conclusion does not spring from a statute of that state nor even from a clear or satisfying line of decisions. It is, however, the reasoned judgment of the circuit which includes Illinois in which a judge of long experience in the jurisprudence of that state participated. Without a definite conviction of error in the conclusion, this Court will not reverse that judgment. MacGregor v. State Mutual Life Assurance Co., 315 U. S. 280. Cf. Reitz v. Mealey, 314 U. S. 33, p. 39; Railroad Comm'n v. Pullman Co., 312 U. S. 496, 499. The Government does not challenge the conclusion of the Court of Appeals that Illinois law controls. It sharply differs as to the meaning of paragraph ninth, construed generally, and as to the Illinois rule, but does not urge that a federal rule of interpretation applies. The suggestion is made that Helvering v. Fitch, 309 U.S. 149, 156; Helvering v. Fuller, 310 U. S. 69; Helvering v. Leonard, id. 80; and Pearce v. Commissioner, 315 U. S. 543, require determination by this Court of the Illinois law. In each of these cases, after courts of appeals had given their opinion of the law of the respective states on the power of the state courts to alter or revise property settlements in judgments of divorce, we reviewed the state decisions to determine whether the husband or wife was taxable under the federal tax system upon the income from the settlements. This depended upon whether the husband could show clearly and convincingly under the state law that the settlement income was not received by the wife pursuant to his continuing obligation to support or whether the wife could raise doubts and uncertainties as to the proper conclusion. Pearce v. Commissioner, supra, 547. Opinion of the Court. 317 U.S. It is true we examined the state cases to determine the applicable state law, but we did it for the purpose of determining whether the taxpayers had met their burden of proving the Commissioner of Internal Revenue wrong in assessing deficiencies against them. We could do the same here but we are satisfied that the finding of the Court of Appeals on Illinois law is a determination that meets that burden. A requirement of a demonstration of state law, "clearly and convincingly," may well necessitate a review of the conclusion of the Court of Appeals, while a requirement of a finding, as here, of the ultimate fact as to the law would not. If reasonably avoidable we should certainly avoid becoming a Court of first instance for the determination of the varied rules of local law prevailing in the fortyeight states. Nor do we see any reason why we should prefer the view of the Board of Tax Appeals concerning Illinois law to that of the Circuit Court of Appeals within which Illinois is embraced. One cannot say that it would be an arbitrary or unreasonable or even an unlikely holding on the part of the courts of Illinois to conclude that, under the terms of these trusts, equity ought to and would prevent the wife and brother of the donor, claiming authority under the provisions of paragraph nine of the indenture, from vesting the property in themselves or in the donor or in others for the benefit of themselves or the donor, to the detriment of the present beneficiaries. To support this construction, the Court of Appeals cites Frank v. Frank, 305 Ill. 181, 187, 137 N. E. 151, 152. In that case there was a deed for a life estate in realty with vested remainder to others, with "full power and authority" to the life tenant to sell the premises by her sole deed. The life tenant sold the fee for life support, a consideration necessarily usable by the life tenant alone. The power was construed as applicable to the life estate alone and its use unauthorized for the fee. In Rock Island Bank v. Rhoads, 353 Ill. 131, 142, 187 N. E. 139, 141, the Supreme Court of that state construed the authority of a life tenant to use and dispose of the property as may "in her judgment be necessary for her comfort and satisfaction in life" to stop short of permitting her to add any of the life estate property to build up her own separate estate. For the authority of courts of equity in Illinois over trustees, there are cited cases establishing their general power to require action in accordance with the intent of the donor. Maguire v. City of Macomb, 293 Ill. 441, 453, 127 N. E. 682; Jones v. Jones, 124 Ill. 254, 262, 264, 15 N. E. 751; Welch v. Caldwell, 226 Ill. 488, 495, 498, 80 N. E. 1014. The Commissioner cites no Illinois cases which bring us to a conviction of error on the part of the Court of Appeals. People v. Kaiser, 306 Ill. 313, 137 N. E. 826, goes no further than to say a residuary estate bequeathed to a trustee for gifts to such charitable institutions or needy persons as the trustee deems deserving will be enforced by the courts. It also seems that in Illinois a general power of appointment is exercisable in favor of the donee or his creditors. Id., 317; Gilman v. Bell, 99 Ill. 144, 149; Botzum v. Havana National Bank, 367 Ill. 539, 543, 12 N. E. 2d 203. But evidently the Court of Appeals does not consider that these trustees under Illinois law have the power to vest this property in themselves. Such a result follows from their view that the property could not be vested in the grantors. Consequently, this power of the trustees is not a general power but a power in trust exercisable as fiduciaries to carry out the purposes of the trust. We therefore do not need to decide whether if they could vest the property in themselves they would have an interest adverse to the grantor. Without that power their interest certainly is not adverse. Cf. Reinecke v. Smith, 289 U. S. 172, 174. Opinion of the Court. 317 U.S. The real issue is whether, under Illinois law, the trustees' authority under paragraph nine of the trust instruments "to alter, change or amend this Indenture at any time and from time to time by changing the beneficiary hereunder... . . or in any other respect," goes so far as to permit the substitution of the donor for the beneficiaries. Would the trustees with authority to change the terms and "the time when the Trust Fund . . . is to be distributed" be permitted to revoke the trust and thus vest the corpus in the donor. These questions are answered in the negative by the Court of Appeals and we accept that conclusion. These trusts, therefore, stand as though an Illinois statute or a provision of the instruments forbade assignments of any of the corpora or of the income to the grantors except as may be specifically provided by their terms. The exception is of importance in examining the trusts' provisions for the minor children of Douglas Stuart. On the assumption that the Illinois law forbids the vesting of the trust res in the taxpayers under § 166, it would also be impossible for the trustees to accumulate the income for or to distribute it to the grantor directly so as to come within § 167. 124 F. 2d 772, 778. Consequently, the contention that the donors are taxable, as direct beneficiaries, because of the provisions of § 167 alone, must fail. Could it be, however, that the donors were taxable under § 167 because the trustees could change the beneficiaries of the trusts to the creditors of the donors or to any other person and thereby relieve the donor of a legal obligation? Assuming that such a change would result in a distribution to the grantor under § 167 and Douglas v. Willcuts, 296 U. S. 1, the ruling of the Court of Appeals on Illinois law forbids such a distribution from these trusts. A decision that a donor cannot take from a trust under state law certainly prohibits a change of the instrument so as to relieve the donor of legal obligations. The Commissioner, however, raised in the Court of Appeals and has pressed here the liability of the donors for taxation under 22 (a), see footnote, p. 159, on the ground that the trust incomes are chargeable to the donors under the rule of Helvering v. Clifford, 309 U. S. 331. That is, whether after the establishment of the trust the grantor may still be treated as the owner of the corpus and therefore taxable on its income. It is obvious that if each of the trust incomes is attributable to the donors under this rule, they become a part of the present taxpayers' income under § 167 (a) (1) and (2) also. This leads us to consider both § 22 (a) and § 167, and their interplay on one another, together. Section 167 took its present form in the Revenue Act of 1932. It was enacted especially to prevent avoidance of surtax by the trust device, when the income really remained in substance at the disposal of the settlor. S. Rep. No. 665, 72d Cong., 1st Sess., pp. 34-35. It is to be interpreted in the light of its purpose for the protection of the federal revenue. United States v. Hodson, 10 Wall. 395, 406; United States v. Pelzer, 312 U. S. 399, 403. Of course, where the settlor or donor is not actually or in substance a present or possible beneficiary of the trust, he escapes the surtax by a gift in trust. Revenue Act of 1934, §§ 161 to 168, Supplement E, 48 Stat. 727. Cf. Helvering v. Fuller, 310 U. S. 69, 74. In the absence of a legislative rule, we have left to the process of repeated adjudications the line between "gifts of income-producing property and gifts of income from property of which the donor remains the owner, for all substantial and practical purposes." Harrison v. Schaffner, 312 U. S. 579, 583. In the John Stuart trusts, the trustees, in their discretion, were to distribute income to the named beneficiaries for fifteen years and thereafter to distribute the entire net income. In the Douglas Stuart trusts, the directions authorized discretionary distribution to the beneficiaries |