Mansuss Realty Co. v. Commissioner
United States Tax Court
The X Corporation, which was on an accrual basis, deducted from its gross income for the taxable year 1938 a salary item payable to its president, who, with his wife, owned all of X's stock. This salary was not paid until March 16, 1939, at an undisclosed hour. The president of X Corporation did not keep regular books of account, but in his amended income tax return for the year 1938, he stated that it was prepared on an accrual basis.
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The X Corporation, which was on an accrual basis, deducted from its gross income for the taxable year 1938 a salary item payable to its president, who, with his wife, owned all of X's stock. This salary was not paid until March 16, 1939, at an undisclosed hour. The president of X Corporation did not keep regular books of account, but in his amended income tax return for the year 1938, he stated that it was prepared on an accrual basis. Held, such salary item not deductible by X Corporation pursuant to section 24 (c), Revenue Act of 1938.
1Opinion of the Court
OPINION.
Kern, Judge:
The Commissioner determined deficiencies in petitioner’s corporation income and excess profits taxes for the year 1938 in the total amount of $568.82. Petitioner contends the Commissioner erred in. the application of the provisions of section 24 (c) of the Revenue Act of 1938 to its deduction of a certain salary item accrued by petitioner in 1938. This deduction was in the amount of $2,000 and was claimed by petitioner for salary accrued, but not paid until March 16, 1939, to its president, Jacob Sussman, who, with his wife, Ida, owned all of the capital stock of the…
2Cases cited6 opinions
- Guaranty Trust and Safe Deposit Co. v. Green Cove Springs and Melrose RailroadSupreme Court of the United States · 1891
- Burnet v. Willingham Loan & Trust Co.Supreme Court of the United States · 1931
- Gregg's EstateSupreme Court of Pennsylvania · 1906
- Daley v. AndersonWyoming Supreme Court · 1897
- Baltimore & Drum Point Railroad v. PumphreyCourt of Appeals of Maryland · 1891
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