Laurie v. Commissioner
United States Tax Court
In 1943 and 1944 petitioner received $ 750 and $ 1,500, respectively, from one of the partners of the partnership of which he was then, and had been for sometime theretofore, an employee. The Salary Stabilization Act, in effect during those years, generally prohibited increases in salaries. The partner was familiar with the substance of the law, and designated these payments as gifts and so treated them for accounting and tax purposes.
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In 1943 and 1944 petitioner received $ 750 and $ 1,500, respectively, from one of the partners of the partnership of which he was then, and had been for sometime theretofore, an employee. The Salary Stabilization Act, in effect during those years, generally prohibited increases in salaries. The partner was familiar with the substance of the law, and designated these payments as gifts and so treated them for accounting and tax purposes. Held, the sums received were additional compensation and includible in petitioner's gross income under Internal Revenue Code, section 22 (a).
1Opinion of the Court
OPINION.
Kern, Judge:
Under the provisions of the Internal Revenue Code, “compensation for personal service” is subject to income tax, whereas “property acquired by gift” is not.3 Cases involving the distinction between taxable compensation and tax-free gifts are many, and it has been generally regarded that each case must be decided upon its own facts. However, certain guiding principles can be distilled from the cases, which are of aid in resolving the issue herein presented, namely, whether the payments of $750 and of $1,500 received in 1943 and 1944, respectively, by petitioner are taxable…
2Cases cited3 opinions
- Old Colony Trust Co. v. CommissionerSupreme Court of the United States · 1929
- Bogardus v. CommissionerSupreme Court of the United States · 1937
- Schall v. CommissionerUnited States Tax Court · 1948
3Cited by14 opinions
- Silverman v. CommissionerUnited States Tax Court · 1957
- Smith v. Manning (Two Cases)Court of Appeals for the Third Circuit · 1951
- Walker v. CommissionerUnited States Tax Court · 1956
- Jackson v. CommissionerUnited States Tax Court · 1956
- Alhadi v. Comm'rUnited States Tax Court · 2016
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