Montelepre Systemed, Inc. v. C.I.R.

United States Court of Appeals, Fifth Circuit. No. 91–4395. MONTELEPRE SYSTEMED, INC., Petitioner–Appellant, v. COMMISSIONER OF INTERNAL REVENUE, Respondent–Appellee. March 30, 1992. Appeal from a Decision of the United States Tax Court. Before REAVLEY, HIGGINBOTHAM and DEMOSS, Circuit Judges. REAVLEY, Circuit Judge: Taxpayer Montelepre Systemed, Inc. (Systemed) gave up one of its rights under a management contract in exchange for money. The Tax Court characterized the payment that Systemed received as compensation taxable under

26 U.S.C. § 83

in the first year that Systemed's right ceased…