G. Angelo Co. v. Commissioner
United States Board of Tax Appeals
1. A corporation which is shown to have derived nearly all of its gross income from trading as a principal is expressly excluded in section 200 from the exemption provided under section 218(a)(e) of the Revenue Act of 1918. 2. Where compensation for the personal services of stockholders was neither authorized, paid, nor accrued, no allowance therefor can be estimated and allowed as a deduction from income. 3. Under the circumstances petitioners are held entitled to a…
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1. A corporation which is shown to have derived nearly all of its gross income from trading as a principal is expressly excluded in section 200 from the exemption provided under section 218(a)(e) of the Revenue Act of 1918. 2. Where compensation for the personal services of stockholders was neither authorized, paid, nor accrued, no allowance therefor can be estimated and allowed as a deduction from income. 3. Under the circumstances petitioners are held entitled to a comparison with respresentative concerns, as provided under section 328 of the Revenue Act of 1918.
1Opinion of the Court
*463OPINION.
Love.'
In the first issue petitioner, the G. Angelo Co., claims to be a personal service corporation and, therefore, it is exempt from taxation as a corporation as provided in section 200 and section 218 (e) of the Revenue Act of 1918. The provisions of section 200 material to the issue are as follows:
The term “ personal service corporation ” means a corporation -whose income is to bo ascribed primarily to the activities of tbe principal owners or stockholders who are themselves regularly engaged In the active conduct of the affairs of the corporation and in which capital (whether…
2Cases cited2 opinions
- In re New York & W. Water Co.District Court, S.D. New York · 1900
- Gallagher v. De Lancey Stables Co.District Court, E.D. Pennsylvania · 1908
3Cited by1 opinion
- G. Angelo Co. v. CommissionerUnited States Board of Tax Appeals · 1928