William M. Bailey Co. v. Commissioner
United States Tax Court
1. Royalties on patented blast furnace specialties paid under licensing agreements by petitioner corporation to its president held deductible in year of payment. 2. Deposits of insurance premiums by petitioner with trustees under a stock bonus plan creating forfeitable beneficial interests in the officer-beneficiaries, held not deductible.
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1. Royalties on patented blast furnace specialties paid under licensing agreements by petitioner corporation to its president held deductible in year of payment. 2. Deposits of insurance premiums by petitioner with trustees under a stock bonus plan creating forfeitable beneficial interests in the officer-beneficiaries, held not deductible. Section 23 (p) (1) (D), Internal Revenue Code. 3. Amount for which liability was recognized and evidenced by accrual in tax year, held properly accruable. 4. Petitioner, having received net abnormal income in tax years partially attributable to research or…
1Opinion of the Court
OPINION.
Opper, Judge:
Under the first issue petitioner contends it is entitled to deduct royalties or depreciation allowances, see Associated Patentees, Inc., 4 T. C. 979, depending upon whether the transactions with Bailey under which the amounts were paid resulted in a “license” or “sale” of his plate patent.
Although in an agreement for exploitation of patents the parties call themselves “licensor” and “licensee” and the consideration “royalties,” the transaction may nevertheless constitute a sale. W. B. Davis & Son, Inc., 5 T. C. 1195, 1204. But “where he [the patentee] transfers less than…
2Cases cited8 opinions
- W. B. Davis & Son, Inc. v. CommissionerUnited States Tax Court · 1945
- W. B. Knight Machinery Co. v. CommissionerUnited States Tax Court · 1946
- Ramsey Accessories Mfg. Corp. v. CommissionerUnited States Tax Court · 1948
- Lord v. CommissionerUnited States Tax Court · 1942
- Times Publishing Co. v. CommissionerUnited States Tax Court · 1949
3 more not listed; retrieve them via the Exa API.
3Cited by22 opinions
- Lámar v. GrangerDistrict Court, W.D. Pennsylvania · 1951
- Wesley Heat Treating Co. v. CommissionerUnited States Tax Court · 1958
- Joe L. Schmitt, Jr., and Helen N. Schmitt v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1959
- Russell Manufacturing Company v. United StatesUnited States Court of Claims · 1959
- Mississippi River Fuel Corporation v. Gustave F. Koehler, Mississippi River Fuel Corporation v. Commissioner of Internal RevenueCourt of Appeals for the Eighth Circuit · 1959
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