Powell v. Commissioner
United States Board of Tax Appeals
1. Where the respondent determined that the petitioner kept his books on the cash receipts and disbursements basis and the evidence does not show that they were kept on the accrual basis, held that the petitioner may not deduct in his return for the taxable year taxes due for that year but not paid in such year. 2. The petitioner was the president and managing officer of a corporation in which he was the principal stockholder.
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1. Where the respondent determined that the petitioner kept his books on the cash receipts and disbursements basis and the evidence does not show that they were kept on the accrual basis, held that the petitioner may not deduct in his return for the taxable year taxes due for that year but not paid in such year. 2. The petitioner was the president and managing officer of a corporation in which he was the principal stockholder. As a result of the bankruptcy of the corporation his stock became worthless. Held, that the loss sustained by him as the result of the stock having become worthless…
1Opinion of the Court
*512OPINION.
TRAMmell :
In his return for 1928 the petitioner took a deduction for taxes of $6,518.90, of which amount $1,311.51 represented taxes paid in that year for 1927 and $5,141.33 represented taxes for 1928 which accrued in that year but which were not paid during the year. Of the deduction of $6,518.90 taken by the petitioner the respondent disallowed $5,347.78, for the reason that the petitioner kept his books on the cash receipts and disbursements basis. At the hearing the parties stipulated that, if we determine that the petitioner’s books were kept on the accrual basis, the deduction…
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