City Nat'l Bank v. Commissioner
United States Board of Tax Appeals
1. Where no sufficient depreciation, based upon the probable useful life of depreciable assets, has been taken by the taxpayer for years prior to the taxable year in question there is no presumption that the earned surplus shown on taxpayer's books of account is correct for the purpose of computing invested capital.
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1. Where no sufficient depreciation, based upon the probable useful life of depreciable assets, has been taken by the taxpayer for years prior to the taxable year in question there is no presumption that the earned surplus shown on taxpayer's books of account is correct for the purpose of computing invested capital. Decisions in the Appeals of Cleveland Home Brewing Co.,1 B.T.A. 87; Russell Milling Co.,1 B.T.A. 194, and Rub-No-More Co.,1 B.T.A. 228, considered and distinguished. 2. In computing earned surplus, unrealized appreciation can not be used to offset depreciation sustained on…
1Opinion of the Court
*624OPINION.
Phillips:
Taxpayer relies upon the decisions of this Board in the Appeals of Cleveland Home Brewing Co., 1 B. T. A. 87; Russell Milling Co., 1 B. T. A. 194; and Ruh-No-More Co., 1 B. T. A. 228. In each of those cases there was evidence that taxpayer had charged off depreciation in prior years and that such depreciation was substantially correct; and, as between the depreciation charged by the taxpayer and that claimed by the Commissioner, this Board considered taxpayer’s contention as more nearly representing the correct facts and refused to disturb the surplus shown on the taxpayer’s…
2Cited by3 opinions
- City Nat'l Bank v. CommissionerUnited States Board of Tax Appeals · 1925
- Mandel Bros. v. CommissionerUnited States Board of Tax Appeals · 1926
- Moraine Hotel Co. v. CommissionerUnited States Board of Tax Appeals · 1929