Decatur Water Supply Co. v. Commissioner
United States Board of Tax Appeals
A private corporation, chartered under an act authorizing incorporation for pecuniary profit, received a share of the water rents collected from users of water furnished by a jointly owned waterworks.
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A private corporation, chartered under an act authorizing incorporation for pecuniary profit, received a share of the water rents collected from users of water furnished by a jointly owned waterworks. All of the amounts thus received by the petitioner were income to it despite the fact that it was required by its charter to use a portion of the funds in retiring its preferred stock, and despite the further fact that it was required to turn over its plant to the city, which owned the rest of the waterworks, when its preferred stock had been retired or when the city furnished it with a…
1Opinion of the Court
OPINION.
Muedock :
The Commissioner determined the following deficiencies in the petitioner’s income tax:
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The questions presented for decision are (1) whether amounts required by its charter to be used, and used, by the petitioner out of its *291alleged income for tlie respective years to retire its preferred stock were income to the petitioner subject to tax, or (2) whether these funds are to be excluded from gross income and exempt from taxation under the provisions of section 116, paragraph (d), Eevenue Act of 1928. The facts have been stipulated. However, the stipulation need not…
2Cited by1 opinion
- Decatur Water Supply Co. v. CommissionerUnited States Board of Tax Appeals · 1936