Patent Button Co. v. Commissioner of Internal Revenue

CLARK, Circuit Judge.

The Commissioner of Internal Revenue has assessed a deficiency in the excess profits tax for 1942 of taxpayer, The Patent Button Company, which now petitions for review. The sole question involves a cash payment of $80,339.56 made by petitioner in 1942 to its General Manager, Leonard R. Carley; Petitioner claimed that this was deductible, as being compensation to Carley; but respondent held it to be payment for stock transferred to petitioner and therefore disallowed the deduction. The Tax Court in a careful decision analyzing the facts in some detail sustained the…