North-Western Trust & Sav. Bank v. Commissioner
United States Board of Tax Appeals
1. In making loans upon real estate security the petitioner charged and deducted from the face of the loans a commission which was entered upon its books of account and returned as taxable income of the year in which the loan was made. At the close of each year the petitioner had on hand a large amount of mortgage notes and bonds which it had not sold to its clients. The petitioner kept its books of account and made its income-tax returns upon the accrual basis.
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1. In making loans upon real estate security the petitioner charged and deducted from the face of the loans a commission which was entered upon its books of account and returned as taxable income of the year in which the loan was made. At the close of each year the petitioner had on hand a large amount of mortgage notes and bonds which it had not sold to its clients. The petitioner kept its books of account and made its income-tax returns upon the accrual basis. Held that the commissions shown as income upon its books of account and in its returns constituted taxable income of the year in…
1Opinion of the Court
*369OPINION.
Smith:
At the hearing of this proceeding the petitioner abandoned certain issues raised by the pleadings. The issues not abandoned are (1) whether the respondent erroneously included in taxable income commissions upon bonds and mortgages purchased in 1920, a part of which were not sold during that year; and (2) whether the petitioner is entitled to have its excess-profits tax computed under the provisions of section 328 of the Revenue Act of 1918.
The argument of petitioner upon the first point is that the petitioner in effect purchased mortgages from its clients who desired to borrow…
2Cases cited1 opinion
- American National Co. v. United StatesSupreme Court of the United States · 1927
3Cited by4 opinions
- Metropolitan Mortg. Fund, Inc. v. CommissionerUnited States Tax Court · 1974
- Columbia State Sav. Bank v. CommissionerUnited States Board of Tax Appeals · 1934
- Metropolitan Mortg. Fund, Inc. v. CommissionerUnited States Tax Court · 1974
- North-Western Trust & Sav. Bank v. CommissionerUnited States Board of Tax Appeals · 1930