Seinsheimer Paper Co. v. United States

In its income-tax returns for the years 1911, 1918, and 1919 the plaintiff, the Seinsheimer Paper Company, deducted $15,000 for each of said years as total salaries paid to its three officers, $25,000 a year to each of them. The officers of plaintiff company consisted of the father and his two sons, Avho were the sole owners of the outstanding capital stock of the company and whose total salaries for the year 1916 and years prior thereto was $16,000.

The Commissioner of Internal Revenue in computing the net income of plaintiff disallowed as a deduction the sum of $75,000 per year as total…