Hudson v. Commissioner of Internal Revenue

I am unable to concur in the opinion of the Court.

On March 1, 1929, the directors of the corporation, at the suggestion of the company’s accountant, in order to avoid an overstatement of the company’s balance sheet assets, adopted a resolution providing for the charging of all the debit balances of the Hudson stockholders to surplus, the material part of which is as follows: “Be it resolved that the overdrafts shown on the accounts of Charles Hudson, Galvin Hudson, Administrator, Mrs. Charles Hudson and Miss Marie Hudson be cleared out of the assets of the Hudson and Dugger Company by…