Hermax Co. v. Commissioner
United States Tax Court
Petitioner corporation was a personal holding company. Its president, an intelligent business man but unfamiliar with Federal tax laws, turned over to a public accountant, upon whom he relied, the preparation of petitioner's tax returns. The accountant was not an expert in Federal tax law.
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Petitioner corporation was a personal holding company. Its president, an intelligent business man but unfamiliar with Federal tax laws, turned over to a public accountant, upon whom he relied, the preparation of petitioner's tax returns. The accountant was not an expert in Federal tax law. After consulting with one of his associates, the accountant decided that petitioner was not a personal holding company, and he prepared no personal holding company returns for it to sign and file. The question of whether petitioner was a personal holding company was never discussed by its officers and was…
1Opinion of the Court
OPINION.
Kern, Judge:
The good faith of petitioner and its officers is not in question. The sole question presented for our decision is whether petitioner’s failure to file returns within the time prescribed by law was, in the words of the appropriate statute, “due to reasonable cause.” In the case most strongly relied upon by petitioner, Orient Investment & Finance Co. v. Commissioner, 166 Fed. (2d) 601, the question was indicated to be whether the taxpayer exercised, in connection with his tax returns, “ordinary business care and prudence.” Stated either way, our answer to the question is…
2Cases cited2 opinions
- Hugh Smith, Inc. v. CommissionerUnited States Tax Court · 1947
- Tarbox Corp. v. CommissionerUnited States Tax Court · 1946
3Cited by33 opinions
- Davis Et Ux. v. Commissioner of Internal RevenueCourt of Appeals for the Tenth Circuit · 1950
- Haywood Lumber & Mining Co. v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1950
- Stevens Bros. Foundation, Inc. v. CommissionerUnited States Tax Court · 1962
- Bouche v. CommissionerUnited States Tax Court · 1952
- West Coast Ice Co. v. CommissionerUnited States Tax Court · 1968
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