Magnus Beck Brewing Co. v. Commissioner
United States Board of Tax Appeals
Where a timely written contract of petitioner provides that payments be made thereunder on account of indebtedness existing prior to April 30, 1936, on a basis necessarily requiring the use therein of "earnings and profits of the taxable year", if such existed, and petitioner made the required payments therefrom in 1936, held, in computing its surtax on undistributed profits, for 1936, petitioner is entitled to deduct those payments.
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Where a timely written contract of petitioner provides that payments be made thereunder on account of indebtedness existing prior to April 30, 1936, on a basis necessarily requiring the use therein of "earnings and profits of the taxable year", if such existed, and petitioner made the required payments therefrom in 1936, held, in computing its surtax on undistributed profits, for 1936, petitioner is entitled to deduct those payments. Sec. 26(c)(2), Revenue Act of 1936. Saginaw & Manistee Lumber Co.,45 B.T.A. 780; Michigan Silica Co.,41 B.T.A. 511 (on appeal, C.C.A. 6th Cir.), followed.
1Opinion of the Court
OPINION.
Leech :
Respondent determined a deficiency in income tax for the calendar year 1936 in the amount of $11,439.52. Part of that deficiency, to wit, $10,766.15, resulted from the action of respondent in disallowing credit of $47,332.98 under section 26 (c) (2) of the Revenue Act of 1936, in computing the surtax on undistributed profits.
The petitioner is a corporation organized under the laws of the State of New York, on December 23, 1932, with an authorized capital stock of $500,000, and is engaged in the brewing industry. It filed *79its income tax return for the calendar year 1936 with the…
2Cited by2 opinions
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- Magnus Beck Brewing Co. v. CommissionerUnited States Board of Tax Appeals · 1942